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Ask any founder or co-founder of a company and they will be able to tell you more than one mistake they would’ve made either while starting up on their own. No startup can become successful without their fare share of startup mistakes.
Finding the wrong co-founder, hiring the wrong employee, not signing legal agreements, hiring friends and the list of startup mistakes go on. What are some of the most common startup mistakes to avoid? Let’s hear it from the horses mouth.
I Want to Be My Own boss
One of the biggest mistake entrepreneurs make is to underestimate how tough it is going to be. Naren Gupta, Co-Founder, Nexus Venture Partners, says “Don’t start a company just to be your own boss, it doesn’t quite work that way. When you hire someone, you are pretty responsible for the person and responsible for what the employee wants to see in the company.”
“As far as Co-founders go, definitely look for people who will compliment you, challenge your assumptions rather than looking for ‘likeness’ in all aspects. This is super important.” says Krish Subramanian, Co-founder of ChargeBee.
Gupta says that one of the biggest reasons why startups fail is because team members can’t work with each other. This makes finding the right co founder a very essential step. Make the wrong choice and things might not go the way you want.
Look Ma, No Product. But the Website is Awesome
Among product companies one of the earliest mistakes we see is that they end up working on the product website instead of the product. Krish, says “Website first, instead of working on product is a wrong approach in my view. Just get a launch page & work on the core messaging to get more trial signups. Talk to customers instead of building the website.”
He feels that startups should instead iterate on the product. “The 3-4 weeks you may end up spending in the initial 4 months after quitting is too precious to be spent on building yet another website. A fantastic launchrock kind of page iterating on message is sufficient,” Krish says.
Picking the Right Tech
For a startup choosing the right technology goes a long way in deciding their future. Dr.Naren says “Don’t start a company because an area or technology is hot. Today it might be something tomorrow it might be something else. Do it because you truly believe in that area and you have some expertise.”
Krish concurs with this thought, he says “When it comes to technology, what you are comfortable with matters a lot more than the latest & the coolest out there. If product is successful, it is not always because of the tech stack, rather the use of it and how well it is built.”
Keep Some for YOU
A common mistake startup make during the growth stage is to fall in the funding trap and give away equity early on itself. Paras Chopra, Founder of Wingify says from his experience “We successfully dodged many “Angel Investors” or “Mentors” who promise to help you out for a (big) chunk of equity. Stay clear of giving up equity early on.”
If you give away too much equity, you might find it tough to raise more capital later on. It will also make it a less exciting proposition for the founders in the long run, unless you start taking a fat salary.
Keep the Books Clean
One important thing startups have to be wary of is money-matters. If there’s anything related to money, you want to spend a lot of time getting it right. “We should have gotten important pieces like the right payment processor, accounting systems, good charted accountant. earlier than later. Once bad systems and habits are put in place, it takes a lot to replace them,” says Paras.
Where’s the market?
Marketing is a key essential requirement for any startup. An efficient marketing strategy and team can make a huge difference. In marketing, building an audience takes a long time. Startups need to plan for 6 to 9 months ahead with content marketing to be where you want to be.
Sometimes there is no market to begin with. But then, entrepreneurs end up creating one.
Hire Right & Wise
Hiring mistakes are very common throughout a startup’s life, and common issue found is that startup hire inadequately. “Not hiring more. We should have filled many critical positions (especially in sales and marketing) much early on and expanded the business side of the company much faster.” says Paras.
Mentors play an important role in a startups life, getting the right mentors can make a huge difference. “Reach out for help, shamelessly to mentors for anything you do not know. It is not worth spending a lot of time figuring out by making mistakes (though that is also required!).” says Paras. However, there are a few out there who might not be of any real help. Do a thorough reece before you officially take a mentor on board.
Inspite of all the mistakes made, startups make you multifaceted and you end up learning a lot more than what you started with. If you’ve gone through the grind and have lessons to share, we’d love to hear from you.
At UnPluggd-Pune this Saturday, the best of our startup founders will share lessons on bootstrapping, scaling and other things. Details here.