At its heart, entrepreneurship is about uncertainty. It’s about having some intuition that people will actually want to buy whatever it is that you’re offering. And it’s about taking the risks to make it happen.
Sometimes entrepreneurs succeed and those are the ones that we tend hear about. Practically every day a story comes out about a new successful company that’s making a lot of money.
But there’s also a downside to being an entrepreneur. Entrepreneurs aren’t the recipients of supernatural prophecies about the future. They have to make an educated guess, like everybody else about what will really happen. Sometimes they make mistakes, and this is all part of the learning process. But sometimes these errors in decision making aren’t necessary. In fact, an abundance of mistakes holds most entrepreneurs back and stops their businesses from ever leaving the ground.
Here are some of the most common, yet easily avoided, mistakes made by entrepreneurs.
Hiring The Wrong People
As your business begins to take off, you’ll find that there is just too much work for one or two people to perform. You’ll start hiring other people to come and work for you, just like any other business. But this is where problems can start to creep in.
When it comes to hiring staff, one of the biggest mistakes that entrepreneurs make is to hire their friends. Hiring friends might sound like a good idea on paper; after all, who doesn’t want to work with their friends? But economic and personal relationships don’t tend to mix very well. What happens if one of your friends isn’t pulling their weight? Even worse, what happens if one of your friends is criminally negligent or steals from the company? It’s not just the end of the business relationship. It’s the end of the personal relationship too. Every time you employ somebody you know, you run the risk of that relationship ending badly.
Inexperienced entrepreneurs also tend to be atrocious at hiring the right people. Often they’ll focus on a person’s CV and education believing that this is what is important. After all, what matter more than the companies a person has worked at before and the grades they got in college? A lot actually.
As it turns out, what’s on the CV is only part of the story. Yes, it might look as if they have all the technical expertise you need for your company. But do they have the right attitude? And do they want to make your company a success? Smart entrepreneurs go beyond the formalities and test whether potential employees have soft skills. Can they engage in productive conversation with other employees? Are they interested in the work that your company is doing? Do they have a passion, or at least a commitment, to their work? Are they able to negotiate with others? These are all important considerations that assess the entirety of the potential employee’s character.
Failing To Network
You’ve often heard it said that the key to success is life isn’t what you know, but who you know. But in practice, it’s a combination of both. You need to be good at what you do (to get people talking about you). And you need to know the right people in the right places.
Fortunately, getting your foot in the door isn’t actually that difficult. Entrepreneurs often set up businesses in an industry in which they already have experience. And because of this, they usually have a whole network of potential contacts. But even if you’re setting out on a new venture, there are ways to meet the brightest and the best.
One way is to go through your bank. When you set up your business banking account, your bank manager may have informed you about local businesspeople clubs. These clubs are an essential way for local businesspeople to meet other people in positions of authority. These people are both a learning resource and also a potential source of opportunity.
Failing To Have A Brand Strategy
Have you ever wondered why businesses put so much effort into establishing a strong brand? Why is it that everything that they produce, right down the to bottled water they give away for free at their events, is branded? The reason is simple: it’s all designed to breed trust. You establish trust by keeping your branding consistent. Your website should match your products, which should match your newsletter and so on.
But many entrepreneurs do not have an adequate brand strategy. Their branding doesn’t remain consistent across all their platforms. Rather, they way that they interact with customers changes on a customer by customer basis. This is confusing for their customers who expect consistency across the board. And it creates problems for the company since it’s not building up familiarity among its customer base.
Listening To Too Much Advice
Entrepreneurs don’t sit there with a calculator working out all possible paths into the future. That’s impossible. Rather, successful entrepreneurs frequently report that they rely on gut instinct. They just get a feeling for what course of action they should take.
All too often, though, these gut feelings are opposed by those who feel it is their duty to give advice. Sometimes this advice can be helpful. For example, it’s often useful to employ advice in specific areas of your business, like social media marketing. But more often than not, that advice is a hindrance. Everybody seems to have an opinion on what you’re doing. And they way that they conceive of the problems you’re facing will be different to your conception. It’s best to avoid these conversations and instead focus on the advice of people who already have proven success as entrepreneurs. Perhaps you could consult people in your industry who have built companies in a challenging trading environment. Ask them what it was that helped them to succeed, and avoid the nonsense.
Of course, there are plenty of other mistakes entrepreneurs make, like failing to put the customer first. But the above are the most common, and, therefore, the ones that you should give your greatest attention.