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Why your startup is not doing well?
Many entrepreneurs do not know why their startup fails.
Being a mentor and entrepreneurship/leadership coach, after interacting with more than 500 budding entrepreneurs, I have found that these top 9 things stop the startup company to grow drastically. I have even included some of my own experiences in my entrepreneurial journey.
There are so many reasons a startup could fail. I find these are top 9 points on why it fails:
- Started the company because you did not like your job
- Started the company because you just thought your idea is great
- You are afraid of people or you do not like to talk to people
- You are afraid of criticism or you are afraid of other people opinion
- You think money is the reason behind all the evil
- You are too stiff
- You think you do not have enough money
- You started your own company because everyone else is doing
- Disagreement between Partners
Let us see one by one:
You started the company because you did not like your previous job and you did not like to go to a job
In my entrepreneurship coaching experience, I have seen so many people start their company because:
- Your previous job is too monotonous
- Unfortunately, after some time, the CEO role becomes monotonous. You are going to repeat the same job after some time, to keep running your business. The more the organisation grows, the more your job role is going to be monotonous since it is going to be based on some set of rules and process which works most for your business
- your previous jobs lacked challenge
- A startup will have lots of challenge at the initial days. When you start the new venture, you may be taking a too risky leap. Once you are all set, you cannot take too many risks. You have to be careful to keep the momentum to have sustainability of the organisation. Every step has to be carefully measured since your employee's life is in your hand. This means, you will be greatly restrained to take any drastic steps, particularly when your organisation is settling to a safe zone.
- do not like to report to anyone
- The reality is different. If you are in business, the customer is your boss. If you have too many customers, you need to be reporting to too many people. At least in a job, you will have only one or few bosses. In business, the situation is entirely different. You need too much of patience to acknowledge your customer's frustration and always need keep him happy to make your business successful.
- Do not want to work on particular time schedule or delivery schedule
- Most of the business are always time bound. Following the schedule is the key. If you miss the timeline, you are entering into unnecessary risks. Even if you are an avid blogger, publishing interesting blogs on particular time frame is crucial. So if you are averse to time and schedule, either you need to search for business which does not follow any schedule (is there any business which does not follow schedule? if yes, please comment in the comments box)
- Do not want to work under pressure
- A startup business is always demanding. You need to get new business and you need to satisfy your customers irrespective of the type of resources you have or the timelines you have or the cost factor. You need to be more competitive than your competitors if you want to sustain and grow. It creates tremendous pressure.
- Your previous job is too monotonous
Started the company because you just thought your idea is great
- When people think their idea is great, with evaluating the idea, they just quit their job to start their own venture. When Facebook and LinkedIn became the super success, so many people tried to start social network without even thinking that how it will become successful. Sadly, I also started one long back to address the HR community, but never able to get the good number of registrations due to heavy promotional requirements and also not having the idea on how to make big enough apart from where to take help to make it is a success. When you want to start your business, please look for a mentor(s) to validate your idea, assess what is required to make it the success and find the avenues to sell your ideas, before quitting the job. Even though great idea can make your venture successful, but the great idea alone will not make the business a successful one. You need to enough resources to make it big. Also, check whether your idea is already available on the market or being developed by big companies like Google. There are chances that, some other great brain like yours is also working on the same idea.
You are afraid of people or you do not like to talk to people
- As an entrepreneur, you need to be extremely people person. You need to talk to various groups people to popularise his/her brand. You need to talk to investors to raise funds. You need to talk to prospects to sell your product/services. You need to talk to employees to hire and motivate them. If you are an introvert or agoraphobic (afraid to talk to strangers or group), either change yourself or stick with your job. You cannot be dependent on another person to do your tasks. You need to be the leader and lead the company from the front. You need to the leader by example and not by the authority.
You are afraid of criticism or you are afraid of other people opinion
- An entrepreneurship is a journey where ups and downs are common. Sometimes a good decision could also become a bad decision. If you are a person looking for some one's approval or impacted by other opinion or criticism, you can never be a business person. A business person sometimes has to go against the tides till he proves his decision is correct. You should never be carried out by other people's opinion or criticisms. You should be even prepared to challenge expert's opinion in his own stable. In most of the cases, people around you may not have the clarity or confidence on your idea or business. So if you are clear and confident in your vision, go with your gut feed. Do not waste your time on fear of criticisms and other people opinions. Just do it and prove them wrong.
You think money is the reason behind all the evil
- We are living in a society where we have taught and made to believe from our childhood that, the money is the root of all evils. If you have this strong belief, please change it. In Indian culture, Money is otherwise called as Goddess Lakshmi. Goddess Lakshmi is the goddess of money and prosperity. How can a money be evil if money is called as Goddess? Money is used to run lots of educational institutes, feed deprived children, provide free medicines in orphanages, protect the country, give employment and so many other things. If you are averse to the money either change your belief after reading the above points or quit business today. Money is required to run your business too. Without money how will you pay rent, pay salary and pay your bills? How will you grow your business?
You are stiff
- As a startup entrepreneur, you need to be flexible to adjust and compromise on your lifestyle, your thought process, with people and everywhere. The only place you have to be stiff and no to compromise is on your visions. To achieve your vision, you have to be an extremely flexible person, adopt to the changes, surrounding & people, change your temperament accordingly and focus only on your business growth. Else your startup is going to suffer heavily. Growth may not happen at the pace you expect.
You think you do not have huge money
- To start up a business or make the business to successful, you do not require huge money of yours. Most of the business is done with "Other People's Money" shortly called as OPM. To run the business or expand the business, you only need to approach Angel investors, seed investors and venture Capitalists. These people will give you money to run or expand your business by buying a part of the shares of your company. In today's world, online marketing is too cheap. This means you do not require too much of money to market your products and services. Just be cool, network with people, create a good rapport, attend investment meetings & seminars and you will eventually find a good investor for your business. At the least, you can also apply for business loans.
You started your own company because everyone else is doing now
- As an entrepreneurship development coach, mentor and leadership coach, I have come across several struggling and budding entrepreneurs who start their startup venture once they complete their college degree. Many entrepreneurs give reasons why they started the business is that their friends started or someone in their family started so he/she also have to get into business to escape from the family business. There are some unique entrepreneurs who start the business so they can be another Steve Jobs or Mark Zuckerberg or Larry page. They do not have any particular passion for doing the business except that what they will be known as. Exactly, if you are not sure whether you have the passion for your business or not, it is better to put your business idea on hold for some time. Please find a good mentor to decide whether you can be successful in your business or not. Find out what needs to be done to be successful. If there need to be mindset shift, please do it before getting into the dangerous business of entrepreneurship since it is going take most of your energy, time and money if you are not happy about being into business you are currently into.
Disagreement between Partners
- Even though this point appears at the last, but it is one of most important thing on why the business fails. When a team of buddies join hands to start a business for a common vision, it creates more energy and enthusiasm. Sooner or later, the partners get into arguments on different agendas like who should be the CEO, CXO and other labels even before the business picks up. I was talking to a technology startup which was fairly doing well, have the decent customer base which included few of big 500 companies, got good investments, had a great investor confidence and even some investors were chasing to fund them got into a sudden trouble. The reason, disagreement between partners on who need to run the business, who will hold how many percents of shares, who will talk to media to get more attention and other petty reasons. When there is a mood to cheer and celebrate on their expansion plans, these people are engaging in arguments and resentments. More importantly, no one wanted to quit and at the same time, they are not allowing the business to carry out, even the normal day to day operations. This is one of the examples. Another example I can quote is one partner started developing a different roadmap for the company in his mind and the rest does not agree. The irony is the person who has different road map is also happened to be the investor when the business was founded.
If you are into startup and not doing well, check the above lists. If you fall into the any of the above-listed points, please correct it or approach a mentor to help you and guide you. If the above list does not fit you, please share your experience in the comments, so I can try to help you or direct you to a forum or person where you can get good support.
After reading the above list and if you have more to add, please leave it in the comments box, so I can add it to the blogs giving credits to you if I find it really interesting.
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