03 Aug 4 Common Mistakes Young Startups Make
Are you working on a startup? If so, I hate to break it to you, but there’s a good chance it will fail. In fact, recent research shows that 75% of startups fail (based on a study of 2,000 startups that received VC funding from 2004 to 2010). Odds are, you won’t be a Brin, a Zuckerberg, a Systrom, a Karp or a Fake.
1. Forgoing Simplicity
“Building a product is like packing a suitcase: Plan out what you think you need. Then remove half.” — Jonathan Wegener, Founder, Timehop and ExitStrategy
“Young founders tend to complicate things too much, from structuring partnership agreements, financing, leases, etc. This is not a place to be creative; keep it simple, follow the norms and be transparent so everyone is on the same page.” — Jay Levy, Co-Founder, Zelkova Ventures and Uproot Wines
2. Waiting Too Long to Launch
“The biggest mistake I see is companies waiting too long to release the product. It’s easy to let the scope of what you’re building get out of hand. But equally importantly most startups buildmuch more than they truly need to, but this is often only realized in hindsight. Whether your product is working or not, looking back it’s easy to see that you only really needed to build a small fraction of the stuff you built. Most features/options/buttons/settings/etc. simply aren’t crucial to success or failure, and for an early stage startup that means they were wastes of time — you could have done 10x more with that same amount of time and resources.” — Jonathan Wegener, Founder, Timehop and ExitStrategy
“Don’t underestimate the importance of Minimum Viable Design. Your first product will likely be just a little bit ugly, and that’s okay — it’s part of getting to market quickly and testing your idea in front of live customers. But don’t underestimate the importance of achieving a basic threshold of “this looks good (and reputable).” In my first company, people liked our product but were embarrassed to share it because the design and presentation was so poor. When we launchedThe Muse, the result was the opposite — nearly 25% of the people who visited our site shared it with someone else via social media!” — Kathryn Minshew, Founder/CEO, The Muse
3. Hiring Poorly
“Make sure that new hires understand your rate of innovation. You are small and agile, which means you have a high rate of innovation and growth, and with that comes work! Often times, that work eventually goes beyond your job description. At a small company, employees need to wear many hats, and they need to be prepared to wear many hats. If you don’t manage this expectation upon hiring, you will be managing employee issues six months down the line. Those issues will eat into your time, and time is money for a new CEO.” — Kellee Khalil, Founder/CEO,Lover.ly
“Someone told me recently, ‘Any time I’m talking to someone who doesn’t work for me already, I’m evaluating if I should try and hire them.’ Whether that’s someone you want to hire tomorrow or someone you’d like to work with in five years depends on your company, but every entrepreneur should always be recruiting.” — Ally Downey, Co-Founder, WeeSpring
“Some entrepreneurs think it’s a luxury to have accounting, finance, or other support functions, but it’s important not to be afraid of spending resources early on for administrative efficiency. If you don’t have someone to do that for you, you’ll end up spending all your time on things that aren’t critical to growing your company.” — Matt Salzberg, Founder and CEO, Blue Apron
4. Not Embracing Agility
“If you sat down and wrote out a pros and cons list comparing your startup to your corporate competitors, you’d probably find the big gorilla’s list of advantages more than daunting. But on your side of that chart should be words like ‘nimble,’ ‘flexible,’ ‘speedy,’ and ‘free flowing.’ Many entrepreneurs seem to approach their startup like they would a quest to win the Super Bowl, with very defined steps leading to a pre-conceived single, solitary end goal. This doesn’t really work for a startup. While it’s vital to have goals and a clear vision, to survive and thrive you’ll have to keep an open mind and stay agile enough to follow the path where it leads.” — Jeff Jackel, CEO,BuzzMob
BY LAUREN DRELL (Mashable.com)