Fear, uncertainty, and self-doubt – these three are the all-time best friends of first-time entrepreneurs. Why wouldn’t it be? Starting your own business is an intimidating process. Your nerves are wracked, you get heebie-jeebies and an adrenaline rush for chasing something bigger, better, and faster. Here, we will talk about the 7 big mistakes entrepreneurs make when starting for the first time.
Table of Content:
- Misreading the market
- Not hiring the right talent
- Not understanding the competitive landscape
- Failing to price their product
- Failing to deliver value
- Not listening to criticism and feedbacks
- Going too fast
Over the years, first-time entrepreneurs have built a reputation for breaking out of the mold and working hard to live a certain kind of life.
However, needless to say, in this dodgy world of starting a new business, everyone tends to make mistakes. That is why it is crucial to pinpoint the known danger spots before you get caught by those traps. Following are the 7 mistakes entrepreneurs make when starting for the first time along with tips of what you should do instead.
7 deadly mistakes entrepreneurs make
1. Misreading the market
Every business starts with a great idea, but oftentimes the idea loses its fizz when brought to the market.
Making products that no one wants is one of the top reasons why startups fail. Maybe the product doesn’t solve a problem or isn’t unique enough to stand apart from the competition. Maybe it was introduced at an unsuitable time or it just never reached the right audience.
To avoid getting into this pitfall, take time out to thoroughly research other products in the market that are similar to yours, and gauge interest from your potential customers. Once you’ve identified there is enough demand for your product, you should start thinking of ways you’ll spread the word about the great things you’ll be offering with your product.
2. Not hiring the right talent
Hiring is the most critical for any organization. Especially in the early stages where the success of a company lies in the hands of a few people. In the initial stages, these few people are just someone the founders know or they have previously worked with. The time comes when the company needs more people to operate and needs a more classic recruitment process.
Here is where entrepreneurs face serious challenges. As there come sudden requirements in hiring for a specific post, most of the time they are likely to make mistakes hiring the wrong people. Sometimes they hire key staff with little to no experience which further leads to problems.
It becomes more important than to create a structured plan for recruiting people. Take your time to thoroughly revise your options and find a group of talented people that will make the company of your dreams.
3. Not understanding the competitive landscape
No business operates in the market alone unless you have a completely new product. There are numerous businesses in a market that are targeting the same audience and product similar to yours. For your customers to perceive your product compared to the competition, you need to first study the competitive landscape. Find out who your competitors are in the market, what are their strengths and weaknesses, and how you can differentiate your business.
4. Failing to price their product
For startups, the price of their product should be a perfect balance of being high enough to maintain a healthy margin and cover operating costs, while also being low enough to attract customers. Needless to say, product pricing strategy is not only the most important piece to the startup puzzle but also a tricky one to get right. There are about a dozen moving pieces you have to take into account. Once you get them all aligned, it’s like you unlock the most complicated combination lock ever.
To set a price, you’ll need to set up a hypothesis. You can either A/B test it and use various other analytics to refine it. But don’t rely on data alone. Also take your customers, employees, and competition into account to figure out the right price for your product.
5. Failing to deliver value
This is one of the most common mistakes entrepreneurs make. When you’re creating your products or services and determining your business model, your main focus should be your customers – not generating revenue or saving up costs.
Many first-time entrepreneurs worry too much about what profit they will be getting out of this. Honestly, your customer wouldn’t even care about your product and service if it won’t add value to their life. Having to satisfy your customers so that they stick with you over-time is the utmost priority of your business.
6. Not listening to criticism and feedbacks
As a new entrepreneur, you want people to talk about your business whether through social media or pure word of mouth. It’s even better when the messages are in your praise and are positive. However, criticism and negative feedback can be salient for entrepreneurs as it is never easy to deal with badmouthing.
What you need to keep in mind that these critics can be valuable even if they are framed rudely. When someone bashes your product, it is essential to listen to them and see where your product went wrong. When you find that out, see if other people are talking about it too. If there are a ton of complaints, it becomes important to look into the problem and see how you can improve in that sphere. This will only help your product become better for your audience.
7. Going too fast
For entrepreneurs, an adrenaline rush is important for explosive growth. You cannot afford to take things slow when you see everyone around you growing and thriving.
You pack your team of best talents, ink new deals, and rapidly move on sewing new ideas. Okay, just wait a minute! while speed is good, the “going too fast” approach can create cracks in your business over-time.
So instead of squandering large amounts of capital in only your initial stages, it’s wise to conserve it until the company understands what its audience wants.
So there you have it, 7 big mistakes entrepreneurs make in their early stages. It’s impossible to not make mistakes but being aware of them to make smart and wise decisions in your business is even better.
Take a moment to sit back and realize which of these mistakes in this list do you identify the most with. Always remember, avoiding mistakes at every step is what makes a successful founder.
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