Sunday, October 1, 2023

Top mistakes of new startup founders

Must read

Shreya Christinahttps://cafe-madrid.com
Shreya has been with cafe-madrid.com for 3 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider cafe-madrid.com team, Shreya seeks to understand an audience before creating memorable, persuasive copy.

By Maksym Babych, Founder and CEO of SpdLoadthe software development company for startups.

Starting a startup is not an easy task. Making the startup thrive is even harder. In my years of experience as the founder and CEO of a leading software development firm, I’ve noticed some mistakes most founders make, the most important of which are:

Not analyzing your target market

Launch your product too early

Overlook hidden expenses

Ignoring User Concerns

Don’t seek help from outside sources

But before I get into the nitty gritty of these mistakes, let me enlighten you on the ideal thought process behind formulating a startup.

Come up with an idea for a startup

An idea is a set of business hypotheses put forward to solve a specific problem to target consumers to get financial rewards for the solution provided. The idea phase is critical to product development as it determines investor interest in your business and the viability of your startup.

Helping startups grow over the past few years, I’ve found that the most viable ideas are those that follow an idea development process, such as:

1. Hold brainstorming sessions with team members

2. Analyze each idea and assess its strength

3. Analyzing the Competitor’s Market

4. Streamline and refine the idea

However, it is not that simple as there are errors to watch out for.

Let’s discuss this too.

Common mistakes startups make

A recent Bureau of Labor statistic suggests that only: 80% of companies survive after a year. By avoiding the following mistakes, your chances of success improve dramatically.

1. Not Analyzing Your Target Market and Audience

This error can leave your startup with serious consequences which can be:

Poor competitiveness

Marketing to the wrong customer base

Weak product demand

Wrong business model

Early-stage startups should spend more time validating their target audience before launching a product. This will help them better understand the needs of their target audience.

2. Starting too early

Before launch, consider the following: Is there a market for this service or product? Are you ready to bring it to market?

If you answered no to those questions, you are starting too early.

The consequences of starting too early are:

Poor user retention

Recurring Errors

Bad user experience

While it’s also not worth launching your product or service late, you can balance your timing by creating a service with minimalist features and narrowing it down to a specific niche or geographic area – this requires less financial and labor demand.

It also requires fewer features, so you can quickly develop a quality solution.

3. Ignoring multiple ‘hidden’ factors

Hidden factors are cost-influencing properties that are not directly observable and that influence the total price of developing and maintaining a product.

For example, maintenance costs are not easy to estimate as they vary with development team, tech stack and other factors. In addition to maintenance, the additional costs include marketing, updates, etc.

Ignoring hidden costs leads to the following:

Higher financial stress

Expenses that got out of hand

Dissatisfied investors

Bad Marketing Plans

Unplanned downtimes

To avoid this mistake, hire a CTO as a service who understands the intricacies of your workflow and the hidden costs.

4. Not being user-oriented

Being user-oriented means that the product consumer is at the center of the development process. Here the startup prioritizes the needs and experience of the product users over the wishes of other stakeholders i.e. investors.

This error is synonymous with startups just starting out. Early stage start-ups tend to create custom solutions for the sole purpose of raising funds. This lack of user-centricity creates a myriad of problems, including:

user dissatisfaction

Poor retention rate

Low usage

You can avoid this by conducting pre-launch surveys about your product and incorporating user feedback at all stages after development in a timely manner.

5. Ignore outside help

External help is help obtained from outside your internal team. This help can come from the government, hired consultants and mentors.

Problems arising from ignoring outside help include:

Burnout

Easily avoidable mistakes

Unscalable business model

Poor growth

Mentors are a good and essential source of guidance for budding founders, as they provide experiential advice that can help them achieve their immediate and long-term goals.

Now that you’re familiar with common mistakes made by startup startups, what tips can help you with rapid growth?

Tips for starting a startup

It is best to keep the following tips in mind before and during the boot launch:

Have a marketing budget

Find a reliable partner

Intelligently interview potential employees

Create an MVP before launching a full product

Use a reputable monetization model

There is a good chance that your startup will achieve significant success if you apply these tips.

Based on my evaluation of the stats, startups have about a 20% chance of success, and these statistics show that early-stage startups are at high risk of failure. This high failure rate is due to several errors, which have been discussed in this article. However, if you create an adequate budget plan, hire the right skills, and adopt an ideal business model, you can increase your chances of success.

More articles

Latest article

Contents