That makes sense of course. A lot of people contemplating a startup choose not to begin their new businesses in the summer, knowing that people are usually distracted and that getting their attention – critical for a new business – is not easy. So, instead of competing with warm weather, vacations, and days off, these savvy entrepreneurs know that waiting until the fall is almost always the way to go.
But that is not the only thing they need to be smart about. Starting a new business is always a challenge, and it is the smart entrepreneur who navigates around the following five easy to make, yet also easy to avoid, common startup mistakes:
1. Not having a good plan: I know a real estate broker who can tell exactly when he is going to make a sale. There are times, he says, when clients fall so in love with a piece of property that they sort of suspend all rational thought. They “fall under the ether,” as he puts it. “Once they are under the ether, they just have to have this piece of property, and I almost always close the sale at that point,” he says.
Well, new entrepreneurs can have that same experience, but they need to avoid it. It’s a mistake when entrepreneurs get too excited at the thought of having a new business that they jump in too fast without fully thinking through the venture.
Avoid the ether!
2. Not having enough funding: There are few things in business worse than starting a new company and having a cash crunch within the first few months. However, that is exactly what will happen if you start a business without having enough funding. You need to have sufficient money in the bank (at least six months’ worth) for:
- Marketing and advertising
- Paying yourself
So have a plan, work with your lender, and make sure that you have sufficient capital to cover expenses until you are able to establish the business, get clients, get them to pay, and begin being cash flow positive.
3. Not knowing how you will get customers and clients: Similar to #1 above (not having a good plan), this is more specific, and maybe even more important. Before you ever start a business, before you ever throw that “Grand Opening!” party, you simply must have a very clear idea where you will get your business from.
How will you market it? Where will you advertise? You better know this going in or you will be going out before too long.
4. Not having an e-strategy: Even today, at least of half of all small business do not have a website. That is business malpractice. Not only do you have to have a website for all sorts of reasons (legitimacy, so people can find you, to get business), you also have to have a social media strategy from the start.
The good news is that you don't have to cast a wide social media net – you don't need to be on all platforms – but you should cast a deep one. Pick one platform, be it LinkedIn, Facebook or whatever, and master it. Later you can branch out into others.
5. Not having a team behind you: There are a lot of people out there that you should enroll to be on your new business team: Your banker, a mentor (check out the SBA, SBDCs, and SCORE), an online or offline network, and a lawyer and/or accountant for starters. There is a lot to know, but a lot of help is available. Make sure you tap into that.
What lessons did you learn when you started your business? Share your story below.
About Steve Strauss
Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert column is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest,The Small Business Bible, now out in a completely updated third edition. You can listen to his weekly podcast, Small Business Success, visit his new website TheSelfEmployed, and follow him on Twitter. © Steven D. Strauss