4 Mistakes Entrepreneurs Make Early On In The Decision Process

4 Mistakes Entrepreneurs Make Early On In The Decision Process
Elite Daily’s version was heavily edited in-house before being featured there. We felt that the pre-edited version captured the message more effectively and thus provided it here.

Did you stumble across some brilliant concept for a business while singing in the shower this morning? Let’s say you found this huge problem affecting everyone in your circles, and you think you have a million-dollar formula for a solution. Now what? Unless you’re the reincarnate of Steve Jobs, chances are your idea isn’t a breakthrough, but that’s okay. Your idea is a very small piece to a very large puzzle with many moving pieces. Most mentors and venture capitalists will argue your ability to follow through is what makes the difference.

Solid ideas with poor execution won’t end up anywhere near their potential. That being said, bad ideas with poor execution likely won’t make it out of the starting gate. So here’s the million dollar question: Are there some ideas positioned to perform better than others when executed? The answer is yes, and you’ll reduce the odds of some serious disappointment by avoiding these four pitfalls when going through the decision process for your business idea:

1. Choosing something you know you’ll have trouble following through on.

If you can’t get yourself to be passionate about your idea, you’re going to have a tough time progressing. You’re effectively choosing to make the process of building your empire more difficult. So if you think the first 10 percent of work is hard, don’t even bother thinking about that last 10 percent. A good rule of thumb: if your idea doesn’t invoke a sense of borderline-manic excitement, you are probably a wantrepreneur and should stick to your day job for your own safety. No shame in that, though if you can’t follow through on things you should work on fixing that problem first.

2. Your time and your work: no business automation.

As you get ready for bed, you feel a little sniffle coming on. You take a Vitamin C tablet with a tall glass of water, and call it a night. Then you wake up the next morning feeling like the little girl from “The Exorcist.” You might be thinking, “What’s the problem? I’ll just call in sick.” Absolutely everything is the problem, if your business needs you to be there. Here are a few examples of one-man shows that wouldn’t work too well if they got sick:

  • freelancers
  • food stand owners
  • kiosk salespersons
  • cell phone repair shops
  • landscapers
  • pool cleaners

Brainstorm options like using technology to automate work or hiring contractors and staff. It should be safe to assume that most founders are on the grind to break free of the 9 to 5 routine. So with that in mind, it doesn’t make sense to work on a business that falls apart the moment you take a vacation or have an emergency (unless you can afford it).

3. Choosing something you know you don’t have money for.

Try not to make things more difficult in the beginning. If you know you’re going to have trouble finding capital for an idea, then choose something more affordable. Creating more hurdles will only increase the chances of point #1 becoming an issue. For those who have a proven track record of founding successful businesses, this need not apply. That’s because people who have proven themselves are much more likely to find investors, and they usually have what it takes to see an idea to the end.

4. Expensive customers: high acquisition cost.

This is something that needs to be measured over time, but the general gist is this: You have to spend X amount of money on ads, press or other marketing to get a customer that pays you Y. If your X is bigger, your sales won’t be enough to cover the cost of finding customers and converting them. You’re going to be a sinking ship, unless you find a way to tweak your idea. For starters, try lowering unnecessary costs or raising prices and test.

Almost everyone these days thinks they’re an entrepreneur. If you want to better your chances and prove your haters wrong, do your homework on your business model. Most ideas out there are twists on one or more older concepts. Avoid these four pitfalls when forming your own, and make sure you follow through on execution. Now go get started so your business idea can thrive.

Skills

Posted on

July 26, 2016

Submit a Comment

Your email address will not be published. Required fields are marked *