— September 14, 2018
We all make mistakes. The key is recognizing those mistakes and taking steps to learn from them — before it’s too late.
But are you making entrepreneur mistakes you’re not even aware of? You might be. Before these mistakes sink your business, take a step back and see if you’re falling into any of these traps:
1. Growing Too Fast
As a startup, it’s important to find the right balance for growth. It’s exciting to see initial success. And in your haste, you might decide to scale too quickly. I once hired extra people at the first hint of success — and it turned out to be a mistake. The rapid growth wasn’t sustainable.
One study found that scaling prematurely caused a large number of tech startups to fail. Don’t be a sad statistic. Take a measured approach to scaling, and you’ll be more likely to succeed in the long run.
2. Not Paying Attention to Your Human Capital
If you want to grow your business, you need to hire the right people — and treat them well. Some folks poo-poo the perks of working at a startup, but those perks can be what keep people around and invested in your success. I know that working for a startup forced me to grow and I was invested in the business success. I was treated well and responded accordingly. Once we were bought by a bigger corporation, the situation changed. The corporation was better than most others, but the different feel meant I wasn’t as invested. And I’ve since quit.
Pay attention to your human capital. Turnover can cost you more than retention when it comes to employees, so it makes sense to treat your people well.
3. Being Too Cheap
When beginning, you might need to be on a shoestring. That’s natural and normal. However, you don’t want to be too cheap. Sometimes you really do need to spend money to grow your business.
You need to put some money into the marketing business. Sometimes, you need to give your employees a treat. Occasionally, you need an equipment upgrade to perform more efficiently. Be realistic and don’t scrimp to the point that you’re actually hindering your long-term efforts.
4. Solving the Wrong Problem
On occasion, we think there’s a problem — when really there isn’t. You might be surprised to discover that some of the things you focus on are mostly irrelevant. Before you move into a mode where you’re trying to fix something, stop and ask yourself if it’s a real problem. One of the biggest entrepreneur mistakes is wasting time and energy on something that ends up being a nothing burger.
5. Adhering Religiously to Your Business Plan
It helps to have a business plan, no doubt. But sticking to it religiously can be one of the largest entrepreneur mistakes you make. When you’re inflexible, you lose the chance to take advantage of unexpected opportunities. Plus, sometimes circumstances change. You need to be able to tweak your business plan — or even pivot away — if new information changes the game.
Pay attention to how you run your business, and be on the lookout so these entrepreneur mistakes don’t end up resulting in business failure.