Making mistakes is part of the DNA for an entrepreneur, they use them to learn and move forward. But the point is ‘learning’ isn’t it? We don’t need to make mistakes if we can gain from others. So here’s my list of ‘top 10 mistakes’ to avoid.
- The Vision is unclear. You have an idea, it’s your idea, but you don’t live in isolation so this ‘idea’ is going to affect others, perhaps that ‘special other’. Have you talked it through, found out how this looks like to you both? What are the goals? Goals needs to be measurable, accurate (best with few words to describe them), be achievable but stretching and done in a time period. Very often this is not done and you find your partner was working in a different way to great cost.
- Your Ego! Let’s be clear, you have got to own your vision and be its champion, no one else will. You’ll have to be persistent in your goals, and passionate, it is yours. But what personal reality check can you put in the system? The worst business ventures are started because of pride.
- Lack of research. Hindsight is a wonderful thing but it’s too late. There really is no excuse with the web. Find out about your product sector, competition, relevance, potential market size etc. Then add this information to make a business plan to give you a structure for the next period. This is done at the start, not when you have spent $1000’s and have the most wonderful ‘x’ – which of course you totally own – and find its not wanted. Sorry to sound trite but I could name several companies in NZ now who have something that will probably never reach the light of day because they didn’t find out if it was wanted.
- You don’t stand out. Whatever you do you have to stand out for something. What solutions do you offer your clients? What makes you the person to call? Being clear on your values and purpose should show in your promotion and make you a ‘stand out’. People respond when they can trust you and see that you will work for their good. So personal referrals and positive networking are strong tools.
- You don’t take (or can’t listen too) advice. Stunningly I got this from two brilliant leaders of charitable business groups. The top defect of their people was ‘they don’t listen’ and ‘I’ve spent hours trying to show them, but they want to do it their way’. These were genuine promoters of the people in their group, who had plenty of credibility. Also in a recent roundtable meeting of young business people I heard two members leaving making this comment about a man who had monopolised the previous 40 minutes – ‘he just can’t listen can he, he really needs to get the right staff’. (Perhaps some of this is back to point 2?)
- Greed, sorry, but it’s the right word! When you own a vision and you’re passionate about it that’s great, but you’re unlikely to make it without others. Equity partners, investors and top staff around you need inclusion in the dream and the rewards. Again it’s so common for the owner to see it all as ‘his’ and offer minor shareholdings for large investments. If you can make an investment of ‘1’ become ‘4’ for 50% shareholdings are you not better off?
- You don’t go with you gut! To start a business takes courage and often it’s a sense of what needs to be done, or what needs to be found, that drives the entrepreneur. That intuition cuts through complexity. Read Malcolm Gladwell’s ‘Blink’ for a great insight into the commercial and social value of intuition.
- You hire the wrong people. Probably my biggest mistake. They were friends or in my larger group. They got in without the full process, probably without my number two’s approval. They got hired without a clear idea of ‘what the company needs’ so we looked at a foreman when we just needed a loyal worker. A huge area well taught in Jim Collins’s book ‘Good to Great’. I’ll paraphrase his thoughts as getting the right people, in the right seats, on your bus.
- You waste money on the peripherals. It’s easy at start up to want great logo’s, notepaper, and websites. My advice is to do it as cheaply as you can until you have profits. Companies are organic in any case and you’ll probably want it quite differently in 12 months. In this area I’d also consider a lot of advertising means. You have to be clear on what your customers need to see and how you get to them, many of the old means are dead.
- You stop selling. You’re always selling who you are and what you have got! But it’s easy to give up because of setbacks. Your strategic plan might need a review but you need to keep moving. In early stages of a company my accountant took me aside and told me we couldn’t continue to advertise, or do shows, or really have a salesman, and if we could stop using the phone that would be great!!!!! He needed to tell me to watch the money but he was completely wrong for our future.
Bonus - 11. You spend too much time thinking!