Startups are very fragile, one wrong step and they can break into a million pieces. While most mistakes can be repented for and a solution can be found, some are not so easy to get over with. Certain mistakes can prove to be fatal for a company, especially a young one, and every founder must be cautious to not commit these mistakes. Here is a list of 5 such mistakes we believe that a startup cannot commit.
A visionless founder is like a ship’s captain without a compass. It is the biggest cardinal sin of a founder. Without a vision you will have nowhere to go. It is this vision which provides the company and the team with motivation on a day to day basis to deal with the challenges ahead. This motivation, if it becomes the driving force of every individual associated with the company, can do wonders. By (lack of) vision here, I don’t mean just a lack of goals but also a lack of ideas as to how to achieve those set goals. Ask yourself where do you want to see your startup 5 years down the line and how do you get there. Your vision is your most priceless commodity. And so never be scared to dream of something extraordinary because as Mohammad Ali said ‘If your mind can conceive it and your heart can believe it then all that you dream can become a reality.’ A founder’s vision is his biggest gift to the company. Look at Apple. Even after the death of Steve Jobs the vision of the man is still apparent in each apple device and it doesn’t seem to be fading any time soon.
Hiring is a very important part of any venture and for a startup it is even more important. Startups have a special requirement when it comes to acquiring talent. Although you know that you want talented individuals, it doesn’t end at that. You require energetic, bright and innovative people. People who are not scared of responsibility and who are dedicated enough to focus their energy to meet the deadlines set. While in big corporations the shortcomings of one employee can be compensated by another, it is not so in the case of a startup.
Another very important aspect of hiring for a startup is hire people synchronized with your vision. You and them must not have a difference of opinion when it comes to the future of the company or else your company would be a thread being pulled in opposite direction. And what happens to a thread being pulled in opposite direction? It snaps and breaks. The same will be the fate of any startup where the employees do not understand and share the founder’s vision.
Lack of Organizational Structure:
This is a tricky one – for many startups have a flat hierarchy with everyone doing everything. To me, it is very important for a startup to have a proper organizational structure (even if you want a flat one). It allows you to focus your limited resources to the maximum potential both in terms of material resources and human resources. A startup cannot go on hiring people, it needs to limit intake and maximize the output from these said individuals. The job distribution needs to be maintained and the founder must not feel afraid to shell out responsibilities and duties. For this a proper structure is required within the organization. The second part is that with a proper structure, people know what effect their individual work is having; it is easier to identify and record achievements. People tend to do better if they feel a part of the company, an integral part of the company. If they can associate themselves with your firm, nothing like it. For this it is important to honor the hardworking and talented individuals and a great way of doing that is to give them a position of higher responsibility or in other words maintain a structure within the organization.
Focusing on the business and not on the product:
Probably the most open point in this article. Focus on the product and not the business model. For example, say you are a startup that manufactures furniture. Now you may have a great marketing team and initially you may sell a lot of the furniture you make. However, there is one slight problem. You do not really make great furniture. So what happens next? Irrespective of the talent of your marketing team, your company ultimately fails. Therefore, it is extremely essential to have a great product that people want. Test it and try it.You may have limited resources so use them to perfect your product not on only marketing it. If you have a great product that changes the way the world does something then it will be accepted and it will sell. So product design needs to be given utmost preference if you want your venture to be anything more than a footnote in history.
Sell out small:
It is probably the most painful mistake a startup can ever make, one that ends up hurting every founder guilty of it. It is true that when a bigger company comes knocking with a lucrative offer it is seldom easy to refuse however it should be understood that the only reason the offer has been made is due to the potential. I am not saying that every startup acquisition is a mistake, on the contrary I believe that acquisition is one of the ways that a startup show of its success however what I mean here is that if you believe in your startup and your idea and if you believe that you can take the company to greater heights then it makes sense to refuse an offer and continue the journey you set out on. It may be the more difficult of the available options at that particular moment but it can be very rewarding. What may be fetching you a million dollars today maybe worth a hundred just a few years down the line. Acquisitions can be lucrative but if you think that your company can do better under you than a bigger corporation then wait with patience, work hard and enjoy the reward.