The road toward building and growing a startup is not a smooth one. One can always plan and prepare for every move in advance, but there will always be mistakes and hurdles along the way.
We might think that a person running a big successful business knows absolute perfection of everything. But even the biggest entrepreneurs commit mistakes now and then.
So, creating mistakes is always the part and parcel of any journey. However, sometimes, certain mistakes can be really expensive in startups and cause serious damage.
Many popular entrepreneurs agree that they have made mistakes in their startups that proved to be super expensive for them in the future.
- Not Hiring a Smart Team in the Early Stage
- Being Too Generous with Equity
- Getting Comfortable After the Success
- Being Cheap
- Trying to Force and Haste Things Up
- Getting into Partnership
- Trying Too Many Things at Once
- Stressing Over Bad Outcomes
- Having a Rigid Vision
- Getting Professional Branding in Early Stage
Biggest and The Most Expensive Mistakes Entrepreneurs Make in Startups
Mistakes are not something that anyone makes on purpose, it just happens. It can be due to wrong decisions, judgment, or a move at the wrong time. Many entrepreneurs believe that the mistakes they made in their early startup stages turned out to be the biggest mistakes for them.
Here are some of the most expensive mistakes entrepreneurs make in startups:
Not Hiring a Smart Team in the Early Stage
One of the biggest mistakes that entrepreneurs usually make in the early stages of their startups is not paying enough attention to great team building. Not hiring smarter people sooner in a startup hampers growth and progress of it.
It is not just the goal that is important but the team that makes it happen. Entrepreneurs often get absorbed in their purpose that they forget to keep their eyes open for the smart talent. This simple mistake turns out to be really expensive with the time.
Being Too Generous with Equity
Another big mistake that a lot of entrepreneurs commit in a startup is that they sometimes become too generous with their equity. Equity is not something that can be taken for granted, rather it is an asset to be preserved. Many entrepreneurs admit that it was the biggest mistake they made in their early stages.
So, instead of letting go of the equity in the employee equity pool, it is important to hold on to it for the right opportunities. Sam Parr, the founder of The Hustle, one of the most popular American media companies admitted that being generous with equity was the biggest mistake he made early on.
Getting Comfortable After the Success
A quite common mistake and is sure to be the biggest is getting comfortable after getting the success. When entrepreneurs get to savor the new success, they either get motivated or comfortable with it.
Being comfortable might be good for a while but it turns out to be expensive in the long run. An entrepreneur might be able to generate a year’s money in a month and just get comfortable with it. But slowing down after that will only be an expensive mistake for the future of the startup.
In the early stage of a startup, entrepreneurs tend to think that they can do everything on their own and save up money. Being cheap can be a huge mistake as it ultimately drops the quality of work and wastes the most precious thing that is time.
So, instead of always saving up money, it is important for entrepreneurs to spend the money wisely to get some real help from skilled developers, designers, and more. Distributing the work within a skilled team ensures great quality of work and better money-making capacity.
Trying to Force and Haste Things Up
This is quite a common mistake that everyone tends to make. There is no doubt that the competition in the market is massive and to keep up with it, entrepreneurs sometimes try to force and rush things up. It may work for a while but in a long run it turns true to the statement, “Haste makes Waste”.
This mistake’s result might not be visible immediately but it can lead to various hurdles along the way in the future. Doing the work quickly and forcefully can turn out to be one of the most expensive mistakes for any entrepreneur in a startup.
Getting into Partnership
This is another mistake that entrepreneurs tend to make in startups. The road of entrepreneurship can be a lonely ride. So, to have a support system by their side, entrepreneurs bring in a new partner or co-founder without thinking much.
It is always better to partner with people who are already known and trustworthy. Having someone unknown leads to conflicts, and there is always a lack of trust, which ultimately hampers the success of a startup. Many entrepreneurs believe this to be an expensive mistake made by them in their startups.
Trying Too Many Things at Once
Entrepreneurs are known for their multi-tasking skills. But in many cases, they admit that this is a mistake that can be quite expensive for a startup. Entrepreneurs try to cover too many things all at once. This prevents them from fully focusing on one particular goal.
The most important thing is to always keep the main goal in mind and do things along the way. But when entrepreneurs start giving attention to too many things, they get distracted from the main goal, which makes for a really expensive mistake on their part.
Stressing Over Bad Outcomes
Another mistake that proves to be expensive for entrepreneurs in startups is when they stress too much over the bad outcomes. Many entrepreneurs believe this to be one of their biggest mistakes as it demoralizes them and ultimately leads to more negative outcomes.
Everyone needs to understand, accept and learn from their mistakes rather than stressing over them for too long. Stressing too much creates distraction, and burnout, and can lead to some of the biggest mistakes in a startup. If Elon Musk had stressed the failure of his cyber truck, he would not have been able to stay at the top till now.
Having a Rigid Vision
One of the biggest mistakes that entrepreneurs make in startups is being too rigid with the vision. Entrepreneurship is a process of continuous learning. Having a vision is essential, but not being flexible about it along the way, makes for an expensive mistake in any startup.
Running a startup is about continuous discussions, focus on new market trends, understanding users, taking in the feedback, and more. So, not validating the transitions and being rigid only leads to a dead end.
Getting Professional Branding in Early Stage
Another biggest and most expensive mistake that some entrepreneurs make is indulging in professional branding even before the startup is ready for it. Creating a mark in the market with branding is important but spending too much on it in the early stage robs the entrepreneurs of the funds that are otherwise essential for the future.
Getting into professional branding too soon can be a huge risk that might pay off well or just turn out to be a horrible and expensive mistake for an entrepreneur.
The journey of a startup is full of highs and lows. There are days full of celebration of success and there are days full of regrets too. No matter how perfect the team and systems are, there is always scope for some mistakes to happen along the way.
The above-mentioned are some of the biggest and most expensive mistakes that entrepreneurs make in startups. One can always learn from these mistakes and try to avoid them as great entrepreneurs are not the ones who do not make mistakes every now and then but the ones who also learn how to deal with them.
What are the expensive mistakes entrepreneurs make in the early stage of a startup?
- Not building a smart team
- Being too generous with equity
- Trying to force things up
- Trying too many things at once
- Having a rigid vision
- Getting into a partnership without thinking
What are some biggest mistakes that startups make?
- Obsessing over funding
- Waiting too long to start
- Losing focus
- Forgetting the competition
What mistake should small businesses avoid?
Small businesses should avoid paying too much for the services.
Do successful entrepreneurs make mistakes?
Yes, even successful entrepreneurs make mistakes, sometimes out of too much excitement or simply out of the wrong ability to judge the outcome.