Top 5 Most Common Startup Mistakes: It's Gonna Work Out Because I Know It Will
Every once in a while I get to mentor a few aspiring entrepreneurs. Sometimes it happens in an acceleration program, sometimes we just connect on social media and then we do a short skype session and, until recently, this was also happening in Connect Hub. The main reason for being asked to do this is, I presume, not only my decent string of achievements, but mostly my remarkable pile of failures. Which, to be completely honest, is greatly outnumbering my successes (I just wanted to make this clear from the very beginning: I think there is a lot to learn from failures and I make no secret from having hit quite a few in my endeavors).
Recently I talked with a young, smart and very enthusiastic entrepreneur, who is working on a specific marketplace. I won't go into the specific details of the business, that's not relevant. What is relevant, though, is the fact that, during our conversation, a few themes emerged. All of them had to do with what I call "startup mistakes", or exaggerated expectations. Many of these exaggerations are recurrent in all of my mentoring sessions.
The startup playground is filled with a lot of preconceptions, some more obvious than others, but all quite dangerous. I will try to outline a few of them, in a series of 5 articles.
No. 1: Everything Will Work Great, Because I Just Know It Will
I heard this sentence in countless keynotes, in hundreds of one to one pitches, in dozens of mentoring sessions. Almost all entrepreneurs are exhibiting a lot of confidence and they just know their idea will succeed. While I consider confidence to be a fundamental ingredient for any entrepreneur, being overconfident is a huge mistake.
First of all, because confidence can't be a substitute for facts. If you are confident that a market will grow 100% in the next 5 years, but the data is showing only a 3% growth for the last 5 years, then we have a problem. If you are confident you can build a team of highly skilled people in less than 3 weeks, while your previous experience is just being a 9 to 5 programmer (even a great one, possibly) then I don't buy it. If you think you'll go break even in 3 years but you can't create a basic P&L, then I can't move forward, no matter how enthusiastic, honest and confident you are.
Second, because we are consistently told a story which is not entirely true, about entrepreneur icons who succeeded just because they had confidence in themselves. The romanticization of entrepreneurship, the pressure of all the motivating stories about all the Steve Jobs, the Richard Bransons, the Elon Musks is very dangerous. Having a role model that you can follow attentively is one thing, but diving head forward into the unknown, under the assumption that being confident and believing in yourself will substitute hard work and fact checking and lucidity, well, that's as dangerous as doing drugs. I'm not kidding. Many times I see the same sparkle in the eye of the young entrepreneurs, waiting for their dose of self-generated dopamine to kick-in, while they're telling me, for the 27th time, their great idea.
When I was just starting to mentor other entrepreneurs and I was seeing this sparkle I was almost neutral. I was thinking, "well, a little enthusiasm can't be that bad, good for them, let them be self-motivated". But as I grew old and as I had my own share of failures, I learned to cut the crap really fast, sometimes at the expense of being considered grumpy and demoralizing. "Nope, I think you should get a job, with this attitude, you won't build any startup" I say now, and the young entrepreneurs are slowly backing up.
But I learned that is better to back up now, when you have no skin in the game, when you didn't lose 2-3 years of your life, a significant portion of your health and, potentially, a significant amount of money from your investors. It's way better to hate me for 15 minutes and then get back to your job until you get your facts straight, than to walk through hell for 2-3 years and then come back at the same job, but this time with a lot of psychological baggage to be processed.
Being popular doesn't pay too much, anyway, so I'll always chose to be rather honest than popular.
image source - Pixabay
I'm a serial entrepreneur, blogger and ultrarunner. You can find me mainly on my blog at Dragos Roua where I write about productivity, business, relationships and running. Here on Steemit you may stay updated by following me @dragosroua.
https://steemit.com/~witnesses
Nice post, my friend. Very sobering advice. I have seen failed hopes turn into disastrous consequences and great heartache for affected families.
And so, now I am wondering: Have you written any posts about one or two of your notable failures (and what you learned from them) and one or two of your notable successes? I would love to learn more from your experiences.
I am presently "middling-successful" with an enterprise that I developed over a span of several years before it began to bear fruit. It is still somewhat at risk, however, due to my weak skills in the area of marketing.
I'm glad you're here on Steemit, thanks for sharing! 😄😇😄
Absolutely correct! Confidence is great, but Realism can only build a company surviving the chasm. Knowing your risks, and how to mitigate these are key for success!
I can no more agree on this! :)
What's also a problem is when your idea gets validated by everyone you talk to. Everyone says 'That's an amazing concept. Why didn't anyone else do it?'
So you dive in, do the hard work, spend the money and get..... nothing. Everyone still loves your idea, but for some reason just don't want to participate, even for free.
I think the biggest thing to learn from this - and most people should go through this experience at least once in their lives, is knowing when to pull the pin and get back to the real world. Following your dreams is a good thing to do, but following dreams doesn't pay the bills.
I think the one thing we didn't have was a Dragos Roua to guide us and show us how to make our project succeed.
Next time, I think i know who I'm gonna talk to first ;-)
That's very kind of you, Trevor, but I wish I wouldn't be such an expert on failing at stuff. :)))) What I learned, I learned myself the hard way. And I try to protect others as much as I can.
Yes, following your dreams is fabulous. But only if you can do it without going into debt. And that's very tricky because when you get money from investors (angel investor, friends or VCs, doesn't matter) you don't consider that as being debt, which is false.
We didn't go down the route of getting investors.
I don't feel right playing with other people's money.
And we didn't have to go into dept for it either, as I did most of the work, and got family involved to help with the rest of it.
It turned into a family thing, which would have been really cool if it had worked out.
I look at it this way - you learned to run very long distances. but first you had to learn to walk. You fell down a lot at the start. but then you got the hang of it. You still fell down, but not as often.
Once you got the hang of walking you then learned to run. If you look at how you ran as a child and how you run now, the two things are not like each other at all.
The more you learn, often by failing, the better you get. Without failure you can't have success.
From my perspective, even though my project didn't continue, I don't really consider it a failure as such. It didn't work, but I learned a lot.
I succeeded in learning how not to do this. I learned more about my family. I learned how to shut things down when they are not working.
So now I have learned to walk, the next step is running. I know I will fall over again. But I will also be doing more than those who never learn or have the courage or creativity to 'walk'.
And by any measure, that's success.
And the family enjoyed doing our small part , we were learnibg more about ,moden to us , hi tech stuff and having fun doing it , now it learning steemit stuff, I almost feel sorry for my son and teacher
Never has a truer word ... as they say. I hope that there are more of these. Having been involved in a few start-ups, I will be interested to see what further advice you have!
Thank you for sharing these thoughts.
I sketched 4 more, will publish them in the following days. It's easy to spot them once you've been in the field long enough. Like I said, media is not helping much by painting such a rosy picture. But hey, we live, we learn. :)