So you have dreams of creating the next Twitter or Facebook and you think you have a killer idea for a startup company. Well that’s great. The thing is, most startups fail within a few months and only about 20% make it past five years in business. This is especially true for online startup businesses. I’ve been looking into this and found out about some of the most common mistakes that would be entrepreneurs make. Here’s what you need to know:
Not Getting Help
Running your own business is a massive undertaking. Those who do it successfully get partners who can help them to do the job so that they don’t have to rely exclusively on their own knowledge and talents. Those who fail think that they don’t need any partners in their business and that they can do it all alone. The problem is that life and skills tend to get in the way. You end up making silly mistakes when you build your business and ultimately, it’s much more likely to be a failure.
Me Too Ideas
There are tens of thousands of social bookmarking sites, microblogging sites and social networking sites on the web already. It’s been done to death and frankly, it’s unlikely that you’ll come up with a truly fresh idea. So unless you have the money of a company like Google, which can afford to lose money for years while they build Google+, you’re probably wasting your time and are doomed to failure. Come up with something original though which fills a real need and your business could grow by leaps and bounds.
Doing Things On the Cheap
This kind of goes back to the first comment about not doing something all by yourself. If you don’t know how to build a website, then don’t put up something which looks half baked just because you can save money. You can find decent website programmers for a relatively small amount of money and they’ll help you to build a site you can be proud of.
Similarly, spend the money to hire professional writers to create the content for your website. Ultimately, you’ll be happier than if you were to simply do the job yourself or worse, pay someone from a third world country $1 for 500 words of crap content.
I wrote about this in our book on SEO and internet marketing, but I’ll include a brief piece about it here. Back in the 1990s, I was a huge fan of an operating system called PC-GEOS. It was what Microsoft Windows should have been from the start and it came out almost a year before Microsoft came up with Windows 3.0.
However, the owners of PC-GEOS squandered their early lead by waiting more than three years to come out with software development tools for their operating system and by then, Windows had taken over. So, even if it’s not perfect, get something out there which looks competent. Otherwise, someone else will beat you to it.
A Solution In Search of a Problem
Most successful startup businesses solve a specific problem for specific people. This means that if you have a “cool” idea, you need to also think about who would want to buy your cool idea and not simply say “everybody would want it because it’s so cool.”
Funding It From Credit Cards/Not Getting Enough Funding
Precious few successful startup businesses have ever been funded on personal credit cards or on a shoestring budget. Unless your business really doesn’t need the kind of exposure you can get from a bigger budget, make sure that you borrow enough or get enough investors to make your business into a proper success story.
By the same token, some people are really successful in raising money for their startup and they end up lavishing money on things which have no real value. The best example of this is Pets.com, which crashed spectacularly after burning through more than $80 million in startup funding.