6 Vital Mistakes to Avoid for Any Entrepreneur in the Start-Up Ecosystem

Start-ups are the new era trends in business and we have already seen entrepreneurs from different walks of life entering this giant economic shift. But, while many entrepreneurs dream of a successful run of their start-up, only a handful succeed.

Over the years we have seen many new tricks and tools to enhance the start-up ecosystem and make it more feasible for entrepreneurs to sustain in the market. But the rising demand in innovations and digital transformation has seen a rift between the realization of efforts and the real revenue generation for most of the entrepreneurs.

Statistically, 80% of start-ups can sustain up to two years in the market, 72% are able to make it to the third year, 62% up to the fourth and only 56% start-upshave made it to the 5th year. This data itself shows how the start-ups are often failing at making their foothold in the market and loosing out to feudal mistakes. Here, we are going to unravel six of such essential mistakes that entrepreneurs make to lose out on their business.

 

Relevance and Research: 

Relevance is one of the most important factors as you are in the market only if you are relevant and else there is no market for you. This a double edge sword, if you are a new start-up, you need to research the market for relevance and if you are established business then you need to check your relevance to the market from time to time.

The Nokia Case:

One of the most popular failures of modern-day businesses is Nokia’s failure to cope up with relevance. In 2007, Nokia was leading the mobile phone market with a 40% market share, which leads to a collaboration invite from the Microsoft, who began its joint venture from 2011 when the company saw a dip of sales to have a market share of 25% and come 2013, Nokia was selling its mobile phone business to Microsoft, then the market share had slipped down to 14% and by the time it was 2016 even Microsoft announced stopping mobile phone business acquired from Nokia as it had a market share of 1% then.

Nokia produced reliable and sturdy phones then and the market was all about that and in 2007 everything changes, with Apple’s iPhone and Android from Google, mobile phone technology saw a shift in the market and Nokia failed in coping up to this change and most fatal mistake was using Microsoft’s UI and OS as it was not up to the mark with Android or iOS features. 

Any business that loses its relevance with the consumers are bound to lose their business and every year 42% of start-ups fail due to lack of market or no market at all.

 

Cash Troubles: 

Cash inflow is one of the most important factors for any business. Especially if it is Start-up with scarce funding or funding issues. Just look at the numbers as 29% small businesses failas they run out of cash. This shows that businesses struggle to cope up with the expenditure and income ratio. 

The Jawbone Case:

Top-tier venture capital firms like Sequoia, Andreessen Horowitz, Khosla Ventures and Kleiner Perkins Caufield & Byers invested huge money in Jawbone, with its valuation increased to$3.2 billion back in 2014. 

But, even after such a prolific funding, the failure of its fitness tracker made it go bankrupt after liquidating its assets and is considered to be the second-largest start-up failures with venture capital backing.

 

Right Workforce:

The right hire can take your start-up to heights and the wrong one can lead back to failures and that is what happens to 23% of start-ups. How this recruitment blunder can be a deathwish for your business can be seen in this example.

The Compaq Case: 

One name that changed the fate of Compaq is Eckhard Pfeiffer. In 1991, he was appointed as the CEO of Compaq, from $3.3 billion in 1991, Feiffer took Compaq to $14.8 billion in sales by 1996. In 1997, Feiffer became obsessed with the Digital acquisition and lost all its focus on the consumers leading the Compaq to losses and ultimately a merger with Hewlett and Packard.

 

Need for Innovation:

Believe it or not, an innovative mindset can make your Start-up click. For instance, we know that this is the mobile-first era and if you are a small business or a start-up, you must consider a mobile strategy or digitized operation for your business. For this, you must look to develop digital tools like mobile apps by hiring a mobile app development company or form an app development team by yourself.

The Kodak Case:

While the world was in a digital transition of photography through digital photography options and online photo sharing, Kodak- one of the biggest photography equipment and camera firm then focused on the conventional photographic film business and ultimately losing out.

 

Competitiveness: 

Keeping the pricing competitive is really important if your products are overpriced and do not provide the right value for customers, your business is bound to fail and about 18% such businesses fail due to overpricing worldwide.

So, it is important to keep your prices in line with the current market rates or the consumers will easily go for a competitor’s product over yours.

 

Wrong Marketing Strategy:

In the digital age, the right marketing strategy can do wonders for your start-up and poor marketing can make colossal damage to your plans, as 14% of businesses fail due to poor marketing. 

Some of the most promising marketing strategies are Social Media Marketing, Mobile marketing, content marketing, etc.

 

Concluding lines:

If you are an entrepreneur then you know the cost of a single mistake that can cause your start-up to fail. Finding the right start-up plan is important to your business goals as planning these mistakes to avoid them during your start-up journey can make all the difference. You can certainly talk to the experts and peers of your market that is identified through the proper market research to assert and execute a well-though-out Start-up