There’s definitely no foolproof blueprint, no secret recipe, no cheat codes when it comes to starting and running a successful business. Stumbling a bit from time to time is natural, healthy even.
The business world is ever-evolving. New companies and industries pop up left and right. A decade ago, industries such as blockchain, SEO (search engine optimization), and social media marketing were purely on its infancy stages. But here we are. Evolution is everywhere, and there are always new tactics to employ, new tools to get used to, and new strategies to test and implement.
However, for a startup, one small misstep may lead to unseen consequences that can spell ‘make’ or ‘break’ for their business.
Everybody makes mistakes
A 2017 Philippine Startup Survey states that only 11% of known startups today were established before 2012. With a success margin as slim as 11%, there’s definitely not much wiggle room to make mistakes.
We are human, after all, and mistakes are bound to happen at some point. Although it’s perfectly normal to miss a step (or two) from time to time, here are 5 common entrepreneurial landmines you don’t want to get caught up in:
1. Getting emotionally attached to decisions being made
Strategic decision making is one of the most crucial responsibilities a founder or entrepreneur can have. Gut feelings and emotions can lead you in the right way, but left unchecked, can also lead you astray if you’re not cautious. The more intense your emotions are, the more clouded your judgment becomes and the more your personal biases tend to rise.
With the pressure and the weight that comes with strategic decisions, it’s easy to let your emotions take the wheel. That’s why for entrepreneurs, keeping emotions in check to maintain objectivity is key. Doing so enables entrepreneurs to open up doors for their company.
This does not mean leaders should shut their emotions out, but rather, they should know when it’s time to reflect on their emotions and get back to the facts on paper. Knowing when to trust your gut and when to pivot is essential to ensure your business’ survival. Done correctly, few things in the world can stop a business with a focused team led by an unbiased yet decisive founder.
2. Trying to go solo
A definitive rookie pitfall. As the captain of your ship, you simply want to make sure your boat and your crew are safe and on-track, and assure everything’s going swimmingly. Don’t worry, it’s not your fault. It’s easy to care so much and treat your business like your own baby, working and hustling until you find yourself doing a hundred different things at once.
But what ends up happening when you try to do everything yourself is that you can stretch yourself too thin; an easy recipe for burning out. Be sure to acknowledge the things you’re good at and the things you aren’t, and ultimately, understand that a key component of effective leadership is knowing when to take charge and when to delegate.
If you want your business to succeed, you need to find a fit for you. Are you the big-picture, idealistic leader? Or do you want to run day-to-day operations? Figure out where you’re better suited for, and assemble an amazing team to take care of the rest. Remember, if you aim to hit multiple targets, you’re unlikely to hit one.
3. Lack of diversity
There are instances where relying on your friends, families, and your immediate network can sound like a good idea, especially for entrepreneurs with limited resources available. But relying solely on them for product/business model feedback does come with a certain amount of risk.
First, you run the risk of nepotism/favoritism. Even if you don’t intend for it to come out that way, it’s still going to be perceived by other employees, and even more so when it comes to crucial roles such as decision-making. And what if things go wrong? Or worse, what if you need to fire them? Talk about awkward family reunions and birthday parties.
Diversity gives your business an opportunity to leverage different perspectives, competencies, experiences, and skill sets. As entrepreneurs and business leaders, the goal should be to assemble and convert a melting pot of talents and differences into a mosaic that gels cohesively and optimizes growth not only for the business but also for its people. In a rapidly-changing business ecosystem like today, diversity can open up your business to unique competitive advantages.
4. Underestimating the journey
It’s easy to get blinded by the prospects and possibilities of running your business. When you start saying “six months from now”, you’re basically shooting a bullet to your business’ chest.
While we do love the enthusiasm, in reality, companies are not built overnight. It takes months and even years of intense grit and hard work to get a business off the ground. And just when you thought the time has come to finally take that day off, something else will come along that you need to stay up for.
Seeing yourself as the next Henry Sy or Manny Pangilinan is definitely not a bad dream to daydream about, but never think they made it that far after 6 months of hustle then retiring permanently to a newly-bought summer home.
5. Not having enough runway
You hear it all the time. Most failed business owners blame a lack of capital as one of the main reasons their startups failed, and studies back it up. A recent 2019 CB Insights Study on the Top 20 Reasons Why Startups Fail has it placing second with 29% of the total votes from a survey of entrepreneurs who lost their businesses.
A startup’s total capitalization is a lot like an airport runway strip; Make it too short, and your business crashes before it gets off the ground.
Just ask FullSuite Chief Strategist Maggie Po, who helps various entrepreneurs and business organizations mold their corporate infrastructure, she says “The most successful businesses didn’t necessarily have large amounts of capital. They all made smart decisions about their budget to make it sustainable until they became profitable. That involves careful planning and preparation from the team, as well as a deep understanding of the company’s financial health.” If you want to know how to better manage your company’s runway, click here.
Making the right mistakes
To be fair, mistakes can be a great avenue for learning, especially when it comes to the different mechanics of running a business. Mistakes also serve as a test of an entrepreneur’s responsiveness, will, and creativity; acting as opportunities for them to display their grit, innovativeness, and leadership skills during times when it counts the most.
But these 5 are definitely rookie mistakes that don’t need to be made. Making the right mistakes can help you and your business minimize the consequences errors bring as well as teach you the business world’s most valuable lessons.