Don't Be A Wantrepreneur: 6 Pitfalls Of Starting Your Own Business
You want your business to succeed.
I get it.
Who doesn't want to see a business — into which a person dedicates blood, sweat and tears — blossom? But, just so you know, 80 percent of businesses fail within their first years.
That statistic is terrifying and you don't want to end up on the wrong side of it.
Fortunately, knowledge is power and understanding why entrepreneurs fail at building profitable businesses can help you to avoid making the same blunders.
I don't have all the answers, but I can share the patterns I've noticed in other failed businesses.
If you can manage to avoid these six common reasons why entrepreneurs fail, you will greatly increase your chance of becoming one of the 20 percent of entrepreneurs who succeed:
1. They Waste All Their Time Planning
The landscape of entrepreneurship is changing, and what is taught in business textbooks doesn't always remain relevant. This is especially true of online businesses.
So, when you begin your entrepreneurial journey with a 45-page business plan, you're putting the cart before the horse.
Why? Well, business plans aren't based on reality. They are built around "what if," "maybe" and "on the chance that."
The online nature of most new businesses renders these business plans obsolete within weeks.
A one-page plan is often more effective, takes less time and allows you to remain flexible as well as adaptable.
2. They Obsess About Creating the Perfect Business Idea
The easiest way to fail at entrepreneurship?
Never taking action to actually become an entrepreneur because you obsess over your idea too much.
This is the reality for many wantrepreneurs. We obsess about the details of our business ideas and spend all of our time researching.
Don't get me wrong: Research is necessary, and you don't want to set yourself up for failure by acting on a poorly-researched idea.
But when you obsess too much, you come up against analysis paralysis: The inability to make any decision because the information you're consuming is paralyzing you.
And as we obsess, we fool ourselves into believing we're taking action because we're putting in so much work.
If you fall into this trap of obsessing over finding the perfect business idea, you'll become paralyzed. If you don't take action, you will never become an entrepreneur at all, thereby failing.
3. They Tried To Be Too Innovative
The only way to succeed in business is to come up with an idea that has never been done before, right?
One that's innovative and new? Fun and exciting? Cutting edge?
In the current business world, most things have already been done before and if it hasn’t been done, it’s often a sign it shouldn’t happen.
Truly innovative ideas tend to be in the technology sphere and are expensive undertakings. They're often best left for the pros, like Apple, not beginner entrepreneurs.
Sure, you could argue that Apple is so successful because of its innovative new ideas, and you would be right. But you're not Apple. You are trying to get your small business off of the ground, not trying to become the next technology maven.
Not yet, anyway.
4. They Worked Hard, But Not Smart
New entrepreneurs often feel they have to be everything to their businesses: sales, design, copywriting, administration, communications, marketing — everything.
But, the one-size-fits-all model of the entrepreneur is completely ineffective. You're far more likely to succeed if you do solely what you’re good at doing.
The entrepreneur who is excellent in sales but lets administrative tasks fall behind will be far more successful than the entrepreneur who is doing what she can to keep up with sales, administration, web design, marketing and communications all at once.
Channel your energy into the small amount of activities that you excel at doing, and either outsource the rest or let your business ride on the wave you've created with doing excellent, focused work.
If you keep trying to do it all, you'll be mediocre at everything, rather than great at one thing and mediocrity is the fast track to failure.
5. They Spent Too Much Money On Marketing
Within the first couple of years, there's no such thing as too much marketing, right?
That's what we've heard over and over again from industry experts and marketing firms.
But, I'll let you in on a little secret: It's not true. In fact, some of the best business marketing is free. Think content marketing, word of mouth and adding incredible value.
If you're skeptical, spend some time trying everything, then, drop 80 percent of the marketing actions you are taking (that provide only 20 percent of the results), and re-channel your energy — and budget, if it requires it — toward the remaining 20 percent.
Try the free stuff first. Don't go belly up because you kept opening your wallet to pay for marketing.
6. They Followed Their Passion Straight Into the Ground
Everyone tells you to "follow your passion" and you've been soul-searching so you can leverage your passion to build your business.
But, entrepreneurs who follow their passions don't make money; entrepreneurs who provide value to their target markets make money. And sometimes, you'll be lucky enough to have the overlap where your passion provides value to others.
One thing new entrepreneurs fail to realize is that you'll feel a lot of passion for your business, even if it's not focused around a pre-existing passion.
After all, you're growing it, nurturing it and putting your blood, sweat and tears into it. Your business is your brainchild and unless you really hate the topic, you'll be passionate about it for the simple fact that it's your baby.
It's Time to Stop Making These Silly Mistakes
You deserve to succeed. You've worked hard to bring your dream to fruition.
Luckily, your hard work will pay off if you spend your time and energy on the right actions. So, get out there and increase your chances of success.
With a few strategic moves and tweaks, your business will become one of the 20 percent that succeeds.
Sarah Peterson blogs at Unsettle.org, where she helps people start doing work they love through lifestyle businesses. Sign up here for free tips, tricks, and hacks to build your own lifestyle business and start loving Mondays again.