Taking the big leap and starting your own business is exciting and nerve-wracking in equal measure. Since you put in lots of time, money and energy into this baby, it had better stand the test of time. These factors will determine whether this happens or not.
- Single founder
The general challenge with being a single founder of a startup is that you have to do all the work. Naturally, being the accountant, marketer, administrator and operations person will break you. On a funding front, it is also a vote of no confidence. All potential funders will see is someone who wasn’t capable of selling an idea to friends. If your friends can’t buy into your startup, why should an investor?
- 2. Location
It is all about a conducive environment for your startup. Some locations will kill your startup faster, that is why most startups are encouraged to seek incubations because that is where the experts are. You get the guidance you need to keep going in the right direction.
- Not having your consumer in mind
Just because you have a great product doesn’t mean that people will feel obliged to buy it. You may have a self-cleaning shoe that is water resistant, but if people don’t need it, your solution has no purpose in the current market.
You need to know which target demographic needs the solution you are creating. Market research helps you find out who this consumer is.
- Half-hearted effort
Calling yourself an entrepreneur has its prestige these days, but there’s more to it than a fancy title. You need to put in the hours to ensure your business thrives. And that means you need to say goodbye to that day job.
No one wants to invest in a company where the founder is more focused on earning a salary than taking a healthy risk and ensuring that their startup venture blossoms. There is no short cut here. You have to give your business 200 per cent. Anything less is mediocre and doomed
to fail.
- 5. Sacrificing your clients for profit
The classic case of Kenyan enterprise, chasing the all evasive shilling and dismissing your consumers’ needs in the process. There is nothing wrong with wanting to make money, you just need to ensure you create a good product that people want not just now, but will want to have in the future. This is the uphill task of any business.
For example, Coca Cola, the global soft drink company, has produced and sold its lead brand, Coca Cola, for 130 years; does your business have the same potential?
Value begets value, if your product is lack luster, mediocre and you think you can ‘wing it’ you are fooled. A subpar product has a market expiry date. Your users need to be happy first before you can ‘make it rain’ as a company.
- Spending too much
The best way to know if you are spending too much is to do your research and find out how similar startups managed their funding. If one startup was able to get their operations and products on ground with Sh500,000, and you have blown through Sh2m with no product, you need to go back to the drawing board.
The hugest funds killer is your salary budgets. It makes no sense to pay yourself and your employees market rate as a startup, you need to ensure your overheads are kept as low as possible to focus the funds on building a product the market will love and pay for.
- 7. Being Hard-headed
It is remarkable to have a vision and business plan for your startup, but the startup ecosystem shifts as you grow and develop your business. Don’t get too attached to your grand vision, most successful startups tend to do something completely different from what they initially had in mind.
You need to be prepared to latch on and run with the better idea when it comes. That means that change is absolutely inevitable in your startup.
Being rigid and stubborn about your idea, which might be inferior to the new concept could land your startup dead on arrival.
- 8. Small niche
Setting up your startup to target a small and obscure niche in the name of avoiding competition is not a good plan. You need to embrace competition, not run away from it. Good products need, and have competition.
This forces you to constantly seek to improve and perfect the product. If you don’t want competition, stay in the mediocre playing field, which only lasts so long.
- 9. Slow to launch
Every Startup wants to release a perfect product into the market. For this reason, there is always something else that needs to be done to launch at the right time. The importance of launching quickly is that it forces you to ensure you actively improve the product.
Modifications are always made, that is not to say that you should release a mediocre product. If you are launching a new shoe for example, you need to ensure that it fits universal standards. You may have adaptations, some of which your consumers may give feedback on to improve. But you need to ensure that the product is launched and safe, but don’t wait too long.
- 10. Avoiding the leg work
Great product. Check. Target audience identified. Check. Money. What money? To get people to invest in your business, you need to let them know you exist. This is where social media will not help you. You need to physically get out of your space of operation and meet and sell your concept to investors. The same applies to buyers of your product.
If you are in agribusiness and want farmers to use your product, you need to do the leg work, go to the farmers, talk to co-operatives. There. Is. No. Shortcut. You want people to invest, use and buy your product? You need to physically meet them.
– ROSE ODENGO