1. Focusing on the product only and not “marketing” it. If you don’t market your product successfully, no matter how good it is, there won’t be enough customers who will be willing to pay for it says Vito Proietti.
2. Not having enough proof that people are willing to use the service or buy the product (i.e., don’t assume that because you like something very much other people will like it too). Test the waters before jumping in! Usually companies conduct some form of market research, hire consultants or run small pilots with their products/services to make sure they are headed the right direction before investing too much.
3. Not knowing who exactly will buy/use the product and how it will be used by them (i.e., make sure to do some legwork before writing a business plan) explains Vito Proietti. Of course, this is not necessary for products or services aimed at global markets, but its good practice anyway as you may discover new opportunities along the way.
4. Outlining goals which are too ambitious (i.e., don’t bite off more than you can chew!). It’s better to set small goals and achieve them rather than to promise that your company will become number one in its market overnight and then miss on all of those targets and disappoint investors, partners, and customers (and yourself) as a result!
5. No meaningful financial projections. The more solid your numbers are, the better you will be able to plan for the future and make smart decisions along the way (invest in R&D, new equipment, advertising etc.).
6. Underestimating costs of production/service delivery/marketing activities. This is a very common mistake which results in an inadequate return on investment…and nobody wants that! If you understate expenses, your investor may refuse to give you money because he/she won’t see any potential profit associated with it.
7. Ignoring competitive products or services which customers might want instead of yours. Don’t forget about direct competitors even if they are small “garage” companies at this point – it’s crucial to understand their strengths and weaknesses and to come up with a strategy of your own that will allow you to beat them.
8. Having no specific marketing strategy (i.e., don’t assume that a great product will sell itself). Even if you think social media is the way to go these days, there are tons of other channels worth exploring such as traditional advertising (TV ads, billboards etc.), events (trade fairs, conferences), public relations (sponsoring cultural events, charity work) and so on. Make sure the ones you choose match your target audience!
9. Forgetting about distribution methods/channels which might be appropriate for the product or service in question says, Vito Proietti. Chances are there’s more than one way of getting your wares into customer’s hands – you just need to find the one(s) that work best for your product/service and market.
10. Sticking to traditional business model (i.e., don’t assume things will remain the same). Things change all the time, especially in the fast-evolving world of digital technology – make sure your startup is ready to act quickly on new opportunities as they arise or it may become obsolete before you even get chance to establish yourself properly!
11. Not having contingency plan if something goes wrong (i.e., always prepare for worst case scenario!). No matter how well-researched business plan is, there’s no way of knowing what challenges await your company down the road – so think about what steps should be taken in case you fail to reach sales targets, need extra financial support etc.
12. Ignoring legal requirements and restrictions (i.e., don’t assume that because you’re a startup you won’t have to deal with this stuff). You will most probably need to register your company with the authorities and pay taxes on what you earn – so make sure to acquaint yourself with the basic legal requirements before launching anything!
13. Lack of diversification/flexibility (i.e., don’t assume there is only one way of doing things!). Make sure that whatever business model or product/service offering you choose enables some degree of flexibility. When it comes to adapting to changes in customer needs or market conditions. (Or even solving problems caused by unforeseeable events, such as natural disasters or terrorist attacks).
14. Lack of transparency (i.e., don’t think that because nobody’s watching you can lie/cheat/steal!). As an entrepreneur, you need to be open and honest with your partners, investors, etc. Not only will it help build trust. But it will also allow you to act quickly on problems as they arise. So don’t assume everyone has your best interests at heart all the time. Or that it’s always better to cover up mistakes than to admit them explains Vito Proietti.
15. Underestimating impact of unprofessional behavior (i.e., don’t assume people will behave well just because you want them to!). There are cases when even the most courteous/polite behavior may not be enough to solve a problem. So always have backup plan or at least know what steps you will take if things go wrong.
As we can see, there are many reasons why startups fail and plenty of mistakes entrepreneurs make. But if these 15 lessons have taught us anything, it’s that (a) most of the problems associated with startup failure could be avoided. And (b) one is able to do so simply by taking a moment and asking oneself “.