Anyone who takes on the challenge of starting up a business knows that they won’t have everything their own way and that they will need to expect the unexpected. Every industry is highly competitive and one false move can be the difference between success and failure.
With that in mind, here’s a look at some of the most commonplace problematic pitfalls for startups.
1 – Not being ready
Knowing precisely when to introduce your ideas to the world is not easy and failing to get your startup off the ground in a timely fashion can leave space for competitors to steal a march on you and grab the attention of what might have been your users or your customers.
But launching too soon can be problematic too because if you are underprepared as a new business then there can be harsh lessons to be learned. So it’s very important to do as much homework as possible on your market, your target customers and your competitors before you get started in earnest as a new business.
2 – Hiring too quickly
Optimism is perhaps an essential quality among entrepreneurs and startup founders but it is often vitally important not to let that spirit go too far. Specifically, it’s crucial that a sense of optimism about what might be possible for your new business doesn’t translate too quickly into hiring large numbers of people as full-time employees. Startups need to be flexible in their early stages and hiring too many people, too soon results in overheads that can quickly become burdensome if your growth doesn’t keep pace with earlier expectations.
3 – Borrowing too much
Access to finance is always likely to be a key part of the picture as far as startups are concerned. Regardless of the scale of your ambitions or your business as it is launched, funding will inevitably be necessary to get the wheels in motion and get your ideas off the ground.
However, this shouldn’t mean that your business simply borrows as much money as possible because doing so can quickly come to be costly and unaffordable, especially if hasty borrowing decisions are taken early on.
4 – Ignoring good advice
Founding a startup is a notoriously unforgiving and challenging prospect for even the most experienced of entrepreneurs. So getting all the good advice you can find access to can be hugely helpful during the good times and the most difficult.
The decision making will ultimately fall to those in charge of a particular startup of course but ignoring sensible advice from well-placed parties is certainly a pitfall well worth avoiding if you possibly can.
There are any number of different reasons why a startup might fall by the wayside and find itself heading out of business but by avoiding all of the above pitfalls you’ll be giving your business a better chance of competing long enough to make sustainability a reality and your longer term ambitions a more viable possibility.
This guest post is courtesy of Jon Munnery. He is a leading business insolvency expert and a partner at Uk Liquidators the UK’s largest professional services consultancy. Jon provides support and advice to small and large companies alike with the benefit of over 20 years’ experience in the field.