There are so many things that could damage the chances for success of a startup or even drive them to bankruptcy & total closure. In last week’s blog, we talked about the 3 most common reasons for failure that entrepreneurs & startups often encounter. Here are the rest of them, along with some suggested solutions for each scenario:
Employee’s Egotism
It’s true that startups need talented, experienced, and energetic people who have specialised knowledge to grow & succeed. However, be very aware when hiring an excellent person as they could turn out to be an egoist.
Building a business is a team effort, and it only takes one prima donna to send every effort of the whole team into the bin. There would be disharmony between team members, or even worse, between the business & investors, just because of this one person who is so full of themselves.
Solution: Be extra careful when hiring new employee to preserve the harmony within the startup. Conduct team review & carry out team building activities regularly.
Sloppiness
The perks of being a huge conglomerate is even when you messed up, whether the issue is big or small, there is still chances for you to get away by either throwing money into fixing it, or just ignore it & hang onto existing brand reputation.
Entrepreneurs & startups are not that lucky because they have nothing to lean on when they fumble, which means they must be extra meticulous to make sure that nothing will fall through the cracks. Sloppiness causes startups to fail through:
- Poor products
- Bad location
- Legal challenges
Solution: Identify whether you are a sloppy person in business or not. If you tend to focus on the big picture more, find a partner who’s detail-oriented to help you with business planning. A business coach can also help you with the details for your business plan.
Life/Work Imbalance
A lack of work/life balance will create stress, which when go on for a long time will prompt a person to make bad decisions. There have been so many research & findings on this particular matter, yet many startups still continue to operate in round-the-clock crunch mode. Life/work imbalance will cause entrepreneurs (and their business) to fail due to:
- Loss of focus
- Lack of passion
- Burning out
Solution: Lessen your stress level by exercising or meditate on a daily basis, switch off your phone when you go to bed, eating with no distractions, etc.
Inflexibility
The greatest advantage that a startup has over an established firm is its freedom to be nimble. Despite this, some startups tend to continue to pursue its course of action even after it’s been proven impractical. Two huge problems that could be caused by a venture’s inflexibility are:
- Pivot gone bad
- Failure to pivot
Solution: Instil in your brain & mark on your plan the possibility of a radical change of direction for your business from day 1. When the time comes, don’t try to resist the inevitable change.
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