COMMON MISTAKES MADE BY ENTERENEURS

A big part of starting a business is having a plan then having the discipline to act on it. Being part of a startup isn’t always glamorous, and often requires simply submitting yourself to the process.

Taking steps to avoid mistakes frequently made by new entrepreneurs is a part of this process. Here are nine mistakes you should avoid when starting a new business:

1. Not spending enough money or spending too much money.

As a new entrepreneur, money is likely to be one of your biggest concerns. Pre-launch cash flow is likely to be close to nil, so making and saving money will usually take There are two mindsets I tend to see among new entrepreneurs: Either “You have to spend money to make money” or “I’ll spend the bare minimum until I have some decent cash flow.” 

Both of these attitudes, when taken to the extreme, can be harmful. Spend your startup cash wisely, but don’t be afraid to invest in good people and quality products. This will bode well for you in the long term.

2. Think you have no direct competitors.

The excitement about a new product or business can often lead new entrepreneurs to think they really have no direct competition, or that their product is so head-and-shoulders above those of their rivals that they’re in a category of their own.

In reality, it’s extremely rare to have no direct competitors. Unless you’ve invented a completely new product, there will be someone who already has market share in your niche. Do your due diligence to find out what these companies are and how you can differentiate your business.

3. Making hiring decisions based on cost.

This is closely tied to number one, but is so important it deserves to be mentioned separately. When funds are tight, it’s tempting to skimp on the cost of new hires. The problem with this strategy, however, is that you’ll end up paying in the long run.

Low-cost employees and consultants are usually low-cost for a reason -- they are more likely to be inexperienced, unskilled or unreliable (or all three).

4. Not setting attainable goals.

New entrepreneurs can be so enraptured by their “big idea,” they work without a solid plan. But the reality is you must set realistic and attainable goals in order to succeed.

Make a point of setting both short- and long-term goals, and make sure they’re specific. Don’t just say, “I want to make $1 million this year.” Set a reasonable goal, and then determine what specific steps you need to take to reach it.

5. Not thinking about marketing.

“If you build it, they will come.” This is a common belief (sometimes conscious, sometimes not) among new entrepreneurs. They think that their products are so revolutionary that they can just rely on free PR and word of mouth.

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