Anybody can be an entrepreneur but not every entrepreneur has a successful business. Making mistakes from time to time is part of the entrepreneurial process where you often make mistakes and overnight success stories are often exaggerated and untrue. In this article, we will see some of the top 10 mistakes new entrepreneurs make.
The journey of an entrepreneur is one full of challenges especially for beginners. For any business to succeed, their are some mistakes that business people must avoid at all costs.
Top 10 Mistakes New Entrepreneurs Make
They treat their new business like a magical money vending machine
Seriously this it is the most common mistake made by all the new entrepreneurs. Most people who say that they want to start a new business are not actually looking for that at all, instead they just want a magical money vending machine where if they put Ksh. 1 Million in they’ll get Ksh.2 Million back but funnily enough it doesn’t quite work that way.
Here’s how it actually works, most businesses take at least six months to turn a profit, I know most of you would be thinking that’s too long and one should start getting some profit as soon as they invest. I’m sorry but that’s extremely unlikely to happen because you see a business isn’t some ambiguous thing you do to make money.
A successful business is when you do these three things well, one you find or create great products or services to sell, two you put those products in front of the right people and three you give those people a reason to buy and there is a learning curve at getting good at these three things.
Some people are a genius at doing them naturally but like most things in life the majority of us will have to learn through education and experience. If you choose to live in a fairy tale land where you have unrealistic expectations of overnight success then you can expect a failure rate of 99.9 percent.
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 priority over everything else. There are two mindsets commonly seen among new entrepreneurs either you have to spend money to make money or you will spend the bare minimum until you 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.
Taking too much advice or none at all
Intelligent input can make or break your business, ignoring it or not soliciting it means you’re flying blind and your odds of success are low. On the other hand, too much feedback has its own dangers. Develop relationships with a few experienced entrepreneurs who’ve both built and sold businesses within your industry as a rule of thumb choose advisors for specific parts of your business not the overall business
Failure to focus on the business
Another mistake the new entrepreneurs who want to do business make is that when they start the business, they do not focus on the growth of their career. Many new entrepreneurs are energetic and enthusiastic people but they can also be overly optimistic and pursue too many targets and directions at once. This typically results in mediocre results that is why you should define your business mission as clearly and narrowly as possible. When you move in too many directions at once especially in the early days of your business you are likely to fail to execute anything correctly so you end up working on the business instead of in the business.
Failure to follow up with clients
The fifth most important mistake that I will discuss is that the newcomers who start their businesses fail to follow up with clients. Many new entrepreneurs are so often desperate to continually find new clients that they neglect the clients they already have and end up losing business.
Statistics show that it takes seven more interactions to secure a new client than to sell more to a repeated client. So, develop and maintain a useful and organized follow-up system to offer new services to your clients and don’t let them slip away. Focus on being as authentic honest and truthful as possible in your way of selling.
They try to do everything by themselves
At number six we have the mistake that involves the entrepreneurs who try to do everything by themselves without taking anyone’s help which is not a good thing. A big mistake that entrepreneurs make is thinking that they are all alone and they try to operate independently without surrounding themselves with wise counsel. Don’t try to run a new business by yourself find an onboard trustworthy seasoned advisors to discuss your business ideas, strategy, challenges and progress
Attachment to ideas
As an entrepreneur, ideas will come and go and you need to get used to them. As an entrepreneur, you should know that not every idea is a good one and we tend to get carried away with the bad or impractical ideas that barely serve us in the long run.
As a business person you need to listen to those around you and present yourself as a receptive person to receive honest and productive feedback. Becoming overly attached to your ideas can be dangerous and lead you holding on to an end implementing a bad idea learn to let go of ideas even those you are super passionate about.
Overthinking about taxes
Another mistake entrepreneurs make is they usually overthink about taxes. Not everybody likes taxes and one of the biggest benefits as an employee is that you don’t even have to think about them, your employer automatically deducts it straight out of your paycheck but while your employer takes care of your taxes, they still have a firm grip over your time and your time is what’s most valuable.
But with a business, you can buy your time back and have enough money to hire an accountant to handle your taxes. In reality, you shouldn’t fear starting a business because of taxes, you don’t have to deal with them with the money you make you can easily hire an accountant to handle that area for you.
Not knowing when to pivot
Through your early validation efforts you’re likely to gain feedback that you didn’t anticipate. Rather than throwing in the towel or ignoring what you’ve learned altogether, this should inspire you to change your business model to prevent failure. Many successful business ventures have come through calculating a new route. For example Instagram began as a location based social network. Uploading and sharing photos was just a feature it was the feature users latched on to most so burb was reborn as Instagram and well you know the rest of the story. This is also an essential point which mostly new people while doing businesses do.
They’re afraid to invest and lose money
The last point we got is that people while doing business, entrepreneurs are afraid to invest and lose their money and they are frightened of getting scammed. Seeing instant returns on your money is never a realistic expectation. It’s quite optimistic to think that your first product you are selling is going to be a home run win for your business but more often than not people have these expectations.
They think that first product is going to be a win for them or that their first landing page is going to convert. But after their expectations started losing their confidence also loses and they’re afraid to invest more money in this field. Such a mindset is the only reason why a lot of people don’t succeed. They want to hold tight to minimal risk yet have great rewards but that very mindset is what holds people back from achieving their success.
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