10 Setbacks which entrepreneurs must overcome
The most successful people will tell you that at some point in their careers, they thought they were going to fail. Not because they didn’t have enough confidence in themselves, but because they had risked everything.
The difference between these successful people and those we never hear about again is that the former kept going. The successful entrepreneurs faced setbacks that seem impossibly undefeatable to the rest but still battled their way through them.
Here are 10 setbacks which entrepreneurs must overcome,
1. Seeking venture funding prematurely
One of the most common mistakes entrepreneurs make is seeking venture capital when they aren’t ready yet. If you’re not ready, the simple act of seeking funding can can sink your business. The solution is to know what you are — and what you aren’t.
You are probably not ready for venture funding if your growth is slow or if you’re not making money at all. Venture funders like to pile on after businesses have already shown the potential for rapid revenue growth.
2. Unscalable business model
Creating a business model with enough built-in elasticity to grow is a deliberate action — one that many founders either overlook or attempt too early. Before you attempt to grow, you have to identify your core users, ensure that your product reaches market fit, identify the marketing channels with the biggest return on investment and develop the resources to make scaling possible.
3. Lack of diversification
Entrepreneurs might put a laser focus on a single product, initiative or segment of the market — often with a disastrous outcome. They focused primarily on one product that was selling particularly well. The solution is to ramped up efforts on the other products and commit to make it work.
4. Wrong hiring
Every business has limited capital for personnel, so hiring the right people — and only the right people — is critical. You should only hire people who can do tasks that can’t be automated. Look for people who have more than one skill and can play different roles. Finally, put a premium on talent that brings ideas to the table — creativity is a crucial and undervalued trait.
5. Losing key employees
The problem with hiring great employees is that they have options. Whether they found something better or simply wanted a change, every business loses crucial employees who they believe to be irreplaceable. The company’s first responsibility is to fill the gap right away.
6. Losing key clients
Clients leave for greener pastures, as part of a change in strategy or simply to cut costs. For you, it might be your biggest client, but for them, you’re probably just one vendor out of many. When a major client departs, company leadership has two responsibilities, starting with making up for lost business and reassuring staff that everything is under control.
7. Lack of marketing
It is natural for entrepreneurs to focus on their core competency, but there is no such thing as a product that sells itself. Businesses — especially new businesses with limited capital — often dedicate horribly inadequate resources to marketing. Without content marketing, social media marketing and other dedicated campaigns, however, the greatest product in the world is likely to be unknown to the masses.
8. Lack of focus on data
When you first start out, you may insist on making your decisions as logically as possible, using data to back all of your choices. This is a good thing, generally, but data can take you only so far. You’ll have to use emotional reasoning and rely on your instincts a little — a realization entrepreneurs often have after their first year or two.
9. Ideas rarely turn out the way they were conceived
Ideas are what drive businesses forward, but great ideas alone aren’t everything. Just because you cook something up in your head doesn’t mean it will turn out the way you imagined. Ideas are fragile, and unforeseen variables can prevent you from implementing them. The best entrepreneurs realize this, and work around those obstacles.
10. Overpaying for experts
When launching businesses, founders are especially susceptible to aggressive pitches from individuals who are very good at marketing their high-priced skills. Great leadership is paramount to success, but it doesn’t always come from the highest-priced candidates with the most impressive qualifications.