In this article, we are going to see the mistakes first time founders make when starting a business. The aim of this is to prevent prospective founders from making the same mistakes by learning from this article.
These are some of the mistakes first time founders make when starting a business-
Starting a business they don’t have passion for
Naturally, if you don’t care about something, you won’t feel too concerned about it no matter how much you try. The same it is for businesses. Some founders just start a business because they notice it is highly demanded in the market. Their only aim here is to make profit. This may seem logically to you, but when the pressure to keep it going starts coming, they are likely to give up on the business because they are not so passionate about it. This is sure to happen because their only aim here is to make profit, and new businesses takes time to do that, but of which they may not stand the pressure of it for so long.
Not researching the market well enough
When you have a business idea, you are supposed to adequately research the market for that idea. You are supposed to know the market risk associated with that business, you are supposed to know if you would be able to stand the competition in that industry, and if you would be able to satisfy the prospective customers in that field. Most founders go ahead to start their business without adequately researching the business idea, and this would later become a huge problem for them when they are already in the market.
Starting at the wrong time
Most times, their passion for the business would make them rush into starting it, but forgetting that timing is crucial to a business success. Hence they make the mistake of starting at the wrong time, and get only few customers and low income as a result.
Having poor finances and financial plan
Most first time founders fail to realize that much financial resources are required to fully start a business and get it into the market. Hence they rush into launching a business having little finances themselves, having no financial support from others, and having a poor financial plan. What do you think would happen when they run out of their finances having made little or no profit yet? They would have to fold up until they raise money again. Most business shut down completely because of this; the founders not able to raise adequate money and return back to it.
Having the wrong partners
Another mistake a founder make is by having partners that doesn’t share the same passion, aim, and values as they do. You may be passionate about an idea, want it to go into the market for the right reasons and meet customers needs, and you may value transparency, honesty, commitment and so on, but if your partners don’t having any of this then it would be impossible for your business to be successful because you are heading in different directions with different plans for the business. In contrast, if you have partners that share your passion, values, goals, and sense of direction, you would be more productive, and create a successful business.
Recruiting the wrong team and employees
Just the way you need to have partners that share the same views with you, that is how you need to recruit team members and employees that does the same. The mistake most founders make is that they merely hire for workers to use their energy to bring the business to success, but this does not work most times. Let us see a scenario- ‘’Marcus just started his first business which is a Catering and Decoration company. He is so enthusiastic about his work, just the way his partners are. He is required to recruit workers in the company, so what he is looking for are workers who are physically capable to work effectively seeing that a lot is demanded in the production process. He is however disappointed when he hires workers that meets that criteria, only for them to quit after working a week or two. He decides to hold a meeting with his partners to address the issue. In the meeting they concluded to change the criteria for hiring workers. Now Marcus is recruiting with a different criteria; he is looking for people who loves cooking and beautifying their environment. This time he hires workers who not only stay, but deliver excellent services as well. When discussing with one of his partners Tom, he realized that the first set of workers were capable of working, but their lack of zeal for the work made it tiring for them, so their work became more of a burden, and that led them to quit’’.
Most first time founders make the same mistake as Marcus when starting their business.
Ignoring customer’s feedback
It is true that you own your business idea and decide how to run your business, but because you serve customers and they are the only reason why you are in the market, their feedback should matter to you. Most first time founders fail to understand this. Instead they concentrate on building the business into what they want. They fail to understand that you own the idea, but the process of building it would be determined by what you discover when you are already in the market, and because your customer is your priority, their feedback is very important to your business success.
No business plan
Another mistake first time founders make is assuming it is okay to just come up with an idea and having no thought of creating a business plan. When they get into the market with no business plan, they would not be organized and would keep making more mistakes. A business plan would have simplified their plans and steps to be taken to actualize them.
Another mistake they make is not legalizing their company, especially when you are the direct producer and your products and services are essential and delicate. Some business founders would get into trouble because of this.
No technological involvement plan
Most first time founders focuses on the physical market and neglect the ones you can get online. If there is a situation where can’t connect with your physical customers, then you would be out of business. This can happen when there is a pandemic, government order to shut down, and other cases.
These cases stated above are some of the mistakes first time founders make when starting a business. I believe by reading this article, you would be able to save yourself a great deal of trouble and avoid those mistakes. Thanks for reading !