Starting a business is hard! You know it, I know it, and everyone else in this world knows it. But what you probably don’t realize is that it is really easy to screw up your business.
Download this cheat sheet of 10 business mistakes that will nearly break you…literally.
1. Stop thinking big
If you want to be a big corporation like Apple, Google, or Microsoft, you have to think big, right? Wrong!
None of these companies were thinking big when they first started. Thinking big will just cause you to spend more money than you have to and, more importantly, cause you to move really slowly.
Agility is what you have that a bigger company doesn’t. You can move faster than big companies can even if you have a lot fewer resources. When you have a small team and little cash in the bank, you tend to do whatever it takes to survive.
2. Get out of your cave
Do you have an idea of where you want to take your business? I hope you don’t because your vision is probably different than your customers’.
You have to get out of the mindset of “I want” because it doesn’t really matter what you want. All that matters is what your customers want.
Start surveying your customers to figure out what they want and, more importantly, understand why they want it. This will help you create a product that would be so welcomed by your customers that they would be very disappointed if your product or service didn’t exist. Having this will help you make more money.
3. Money doesn’t solve problems, it causes them
If you think money is what you need, you’re wrong. Having less money will spur creativity and allow you to come up with unique ways to get what you want.
Plus, the more money you have, the more comfortable you’ll become. And the more comfortable you are, the more your business will suffer.
For example, I didn’t have much money when I started my first company, so I had no choice but to figure out how to make it profitable quickly.
On the other hand, with my second company, I had a bit more money, so I wasn’t worried about profitability. This caused the company to grow a lot slower than it should have (this will be getting fixed soon).
So, before you hit the road for six months to pitch to a bunch of VCs, think about how much further you would get if you spent that time working on your business.
4. Don’t hire too quickly
You’ll know when things are looking good because at that point you’ll need more employees. But before you make your first hire, you’d better know what roadblocks the employee is going to run into.
The only way you are going to find out what these roadblocks are and what solutions you will need to implement to overcome them is if you do your new hire’s job for a period of time. So, before you hire an employee to fill a new job position, make sure you take on the duties of that position for at least a week.
5. It’s better to have hunger than talent
Hiring talented employees is like flushing money down your toilet. Yes, typically it’s a smart move to hire talented employees, but that usually isn’t the case for start-ups. This is why:
- They require high salaries.
- They move much slower.
- They won’t stick around forever.
- They get stuck in their own ways.
Employees who are out of college or looking to get into the corporate world will be a lot hungrier. They don’t have all of the options that talented employees have, so they’ll work a lot harder for a fraction of the cost.
Plus, just because people did really well at their last place of employment doesn’t mean they’ll do well at your company.
6. Emotions and business are a bad mix
It’s hard to think without your emotions. From a young age, most of the actions you took were based on your emotions instead of logic. So, why would you stop now?
You’ll get further along if you start basing them on metrics.
Sometimes, the best way to do this is to step back and take a break when feeling emotional. Once you calm down, you can then reevaluate the situation and make a decision.
7. Don’t get ahead of yourself
Entrepreneurs have a tendency to get trapped in a Wonderland. They’ll start dreaming about how much money they are going to make. Are you one of them?
I hate to break it to you, but dreaming is unproductive. There is no possible way you can predict how well you are going to do. So, stop dreaming!
If you are going to follow someone’s word, follow Nike’s: just do it. If you want to be rich and successful, you have to work hard. There is no shortcut.
8. Focus, focus, and focus
Expanding is a great way to create multiple revenue streams and diversify. But for your company, it is a bad idea. Here is why you should focus:
- Crawl before you walk – I don’t mean to offend you, but your business is like a baby. You are naive, and you still have a lot to learn, but you probably want to do what all of the other big boys are doing. If you try to run before you can even walk, you’ll just get hurt (or in the business world, make a lot of mistakes).
- Don’t spread yourself too thin – there isn’t enough time in the day to run multiple businesses. You are more likely to succeed if you put all of your time and energy into one company.
- Dominate first – your company will be worth a lot more if you are the leader in your space. Before you expand, you should try to become the leader in your space.
9. You’re not that smart
If you think you know more than your competition, you are wrong. Never underestimate them because no matter how dumb they may seem, they were still able to create a company that is larger than yours.
Don’t be afraid to ask other people for input. There is nothing wrong with asking for help because it will save you time, money, and potentially give you insight into your competition.
10. No detail is unimportant
You can’t be in control of everything forever. Eventually, you’ll have to pass off your bookkeeping to an accountant and your hiring to a recruiter. And you’ll probably even pass off managing those people to someone else in your organization.
Although you can’t do everything, you should still know what’s happening in your company. Even the smartest employees make dumb mistakes, so if you know what’s going on, you’ll be able to prevent some of those mistakes from happening.
Don’t screw up your business with a stupid mistake! Learn from the mistakes other entrepreneurs made so you don’t make the same ones.
And if you happen to make a mistake, don’t worry because we all make them. What separates the good entrepreneurs from the bad ones is that good entrepreneurs learn from their mistakes and keep moving forward.
P.S. If you don’t want to learn from costly mistakes and would prefer to work with people who have already made them click here.