We in general usually learn more from mistakes than from success, so a well-explained startup failure can improve their odds of funding the next time around. However, investors do expect you know the common pitfalls and not repeat them. Repeating any of the following mistakes mentioned here won’t get you any credit for intelligence and learning and will cost you dearly in your funding credibility and real cash.
Making these mistakes again and again in startup can lead you to pitfall
1. You think you know your customers need and want
Just because you like a change doesn’t mean your customers will like it. Before spending any money, make sure you very well know what they are looking for,their feedbacks. And also see other industry experts and investors are into. Be prepared to go through it minutely at least once before you get it right, even with a final input.
2. Believe that you have no real competitors
No competitors means no market, or it means you haven’t looked around. If the market is new and competition is minimal, then the time and costs of educating potential customers probably exceeds your time and budget to stick in the market. Innovation in the face of a few competitors is much less risky.
3. Solve all the world’s problems with a first solution
A startup needs focus to do one job well and keeping aside alternative of solving many problems poorly. It’s tempting to tell everyone about all the future potential uses of your new technology and risk confusing them, having them wait for your future or disappoint them with several poor solutions.
4. Be careful before counting on family and friends
Every startup business is a new challenge and needs real dedication, experience and skills to survive. Friends and family may tell you what you want to hear rather than what you need to hear. Personal relationships and emotions have broken many businesses, so be careful.
5. Never under-estimate cash requirements
Entrepreneurs who under-estimate cash requirements or focus on product development while someone else pays the bills are doomed to fail over and over again. Smart founders always build a buffer into their estimates, find a strong financial advisor and personally sign every check.
As you examine your next startup, it will be worth your effort to stay longer in the race by avoiding these 5 mistakes. Doing so may well save you the time and cost of a startup failure and also will save you from the embarrassing admission the next time around that you don’t pay attention to the advice and counsel of people who have been there before you.
Also Read: 9 Common Startup Legal Mistakes That Entrepreneurs Need To Avoid !