Ten Entrepreneurial Mistakes
It’s hard to avoid certain mistakes, especially when you face a situation for the first time. In fact, many of the following mistakes are hard to avoid even if you’re an old hand.
1. Big Customer Syndrome. If more than 50 percent of your revenues come from any one customer you may be headed for a meltdown.
2. Creating products in a vacuum. You and your team have a great idea. A brilliant idea. You spend months, even years, implementing that idea. When you finally bring it to market, no one is interested.
3. Equal partnerships. Maybe you and a friend start the company together. In each case, you and your new partner split the company 50/50. That seems fine and fair right now, but as your personal and professional interests diverge, it is a sure recipe for disaster.4. Low prices. Some entrepreneurs think they can be the low price player in their market and make huge profits on the volume.
5. Not enough capital. Check your business assumptions. The norm is optimistic sales projections, too-short product development timeframes, and unrealistically low expense forecasts.
6. Out of Focus. Many entrepreneurs – hungry for cash and thinking more is always better – feel the need to seize every piece of business dangled in front of them, instead of focusing on their core product, service, market, distribution channel.
7. First class and infrastructure crazy. Many a startup dies an untimely death from excessive overhead. Keep your digs humble and your furniture cheap.
8. Perfection-itis. This disease is often found in engineers who won’t release products until they are absolutely perfect.
9. No clear return on investment. Can you articulate the return which comes from purchasing your product or service?10. Not admitting your mistakes. Of all the mistakes, this might be the biggest. At some point you realize the awful truth: you have made a mistake. Admit it quick. Redress the situation. If not, that mistake will get bigger, and bigger, and… Sometimes this is hard, but, believe me, bankruptcy is harder.
Photo by costak.
Business Coach, Paul Lemberg is the President of Quantum Growth Coaching (www.quantumgrowthcoaching.com), the world’s only fully systemized business coaching program designed to rapidly create More Profits and More Life™ for entrepreneurs.
Musings of an Eco-Entrepreneur » Top Ten Mistakes to avoid as an Entrepreneur on November 12th, 2006 11:42 am
[...] Add this this your top ten list of Top Tens Lists- Ten Entrepreneurial Mistakes. Here’s the list, click over to the post to get the descriptions for each, it’s worth it. (Via Business Opportunities) 1. Big Customer Syndrome 2. Creating products in a vacuum. 3. Equal partnerships 4. Low prices 5. Not enough capital 6. Out of Focus 7. First class and infrastructure crazy 8. Perfection-itis 9. No clear return on investment 10. Not admitting your mistakes [...]
optimuscrime on November 12th, 2006 7:49 pm
counterpoint:
1. yeah, but an equally dangerous problem is when you don’t have a nice safe anchor client. it’s scary to have all your revenues come from one spot, but sometimes it’s even scarier to not have that one big client — in terms of a high profile reference, low-maintenance recurring revenues, et cetera.
5. too much capital. when you have money, you do stupid things like giving away your product in order to get faster penetration. might work, but you also might misapprehend the real demand for your product. money can save you, but it can also prevent you from learning important lessons. it’s a balance.
Albion on November 12th, 2006 8:27 pm
Thanks for the list of mistakes to avoid. After reading this, I re-confirmed that one needs to be flexible, open minded and without a large ego in business. This will ensure greater avoidance of the common mistakes listed.
Paul Lemberg on November 21st, 2006 11:14 pm
Hey Duane,
Glad you liked this article, and I’m certain it was just an oversight to leave out the author’s credit. I know you want to fix this right away – so here’s the info:
About the Author:
Business Coach, Paul Lemberg is the President of Quantum Growth Coaching (www.quantumgrowthcoaching.com), the world’s only fully systemized business coaching program designed to rapidly create More Profits and More Life™ for entrepreneurs.
Happy Thanksgiving,
Paul Lemberg
Dane on November 22nd, 2006 10:08 am
Paul — thanks for your info! I’ve added it to the article. Happy Thanksgiving to you too.
Dane
Paul Simister on June 5th, 2008 7:07 am
Very interesting article.
Two of the big problems I see are
a) no compelling vision for the business to provide long term direction based on something they feel passionately about.
b) perfectionism (which is mentioned above). people work too long on an idea without taking it market or doing any kind of market testing or research. Waste a fortune in cash and far too long on ideas that don’t pass teh customer “so what” test.
Paul Simister on June 5th, 2008 7:08 am
Very interesting article.
Two of the big problems I see are
a) no compelling vision for the business to provide long term direction based on something they feel passionately about.
b) perfectionism (which is mentioned above). people work too long on an idea without taking it market or doing any kind of market testing or research. Waste a fortune in cash and far too long on ideas that don’t pass the customer “so what” test.
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