Published on June 28th, 2016 | by Jose Vasquez0
5 Amateur Mistakes That Can Ruin Startup Tech Companies
Repeating these easily avoidable amateur mistakes can cause you to lose your business if you aren’t careful.
Everybody’s an amateur at some point, and that includes entrepreneurs. Even if you’re highly experienced in your specific industry, if this is your first time owning and operating your own business, you can be qualified as an amateur entrepreneur, and amateurs make mistakes. Most of these mistakes are harmless, and can be corrected in the normal course of doing business. You simply learn from them, mitigate the effects, and put new processes in place to prevent them. Unfortunately, there are some mistakes that are virtually impossible to recover from.
If this is your first time as an entrepreneur of a startup tech company, be on the lookout for these five potentially disastrous mistakes:
- Not doing the research. Always do your research in advance. Before writing your business plan, research other companies that have done something similar. Before launching your product, research the best practices for doing so effectively. Before initiating a marketing campaign, research your core demographics. Without objective research backing your decisions, you’re bound to end up reeling.
- Waiting for perfection. In a startup, your product is your baby, and it’s natural to want it to be perfect before you launch it. However, waiting until your product is perfect is a surefire way to lose revenue. Your goal should be an MVP—a minimum viable product—that can start generating you revenue while you work to improve it.
- Rushing to completion. On the other end of the spectrum, it’s a terrible idea to launch far before you’re ready. If you don’t have the systems and processes in place to support your ideal workflows, don’t launch. It could ruin you.
- When you get that first round of funding, it’s easy to go overboard with excessive office expenditures, new hires, or ridiculous marketing spend. But if you spend too much before your revenue starts flowing, there’s no going back.
- Neglecting cash flow. Even profitable companies can fall victim to negative cash flow. Pay careful attention to how and when you pay your bills, and how much money is coming in from your products.
Mistakes are unavoidable, and even more so, they are necessary. Without mistakes lining our experiences, we would have no mechanisms for learning and improving ourselves and our businesses. However, it’s important to prevent the major mistakes that can potentially destroy your foundation.