Tips for Avoiding Startup Failure

Do you have a burning urge or unique idea to start a company? Are you a startup and you are concerned about how you are doing things? Well, you are not alone. Here are some hard-earned knowledge shared by some founders. It highlights some of the most common mistakes and how to avoid them.

Starting a company with a mission and purpose

“Solve a real problem that creates real value in the world. Focus on the problem => solution => value => profit chain of events, and try to make a pass through this sequence sooner than later. Also, be strategic. Find a competitive advantage. At Dribbble, we stumbled into ours – we were just building a side project, but it was a site for designers, and Dan is a designer with lots of recognition and credibility. As a result, we attracted a great set of initial users who posted incredible work. Things snowballed from there.”

– Rich Thornett and Dan Cederholm, Co-founders of Dribbble

Find your niche

“I’d say the best advice would be just to get started and once you find something, focus and execute. Don’t try to be everything to everyone right away. If you pick one vertical and do it well, other folks will find you. From a narrow niche of IT professionals who were our early target market, we now have a wide variety of customers.”

– Christian Reber, Founder and CEO of 6Wunderkinder

Nothing is impossible

“Never take no for an answer. Starting a startup isn’t easy and there will always be people who tell you that something is impossible. Don’t listen. When I started Shapeways, complex software needed to be built and when I first reached out to developers, a lot of them laughed and told me it was impossible. I never took no for an answer and eventually found a great team that helped me build what Shapeways is today. Always push for yes! “

– Pete Weijmarshausen, CEO of Shapeways

Underestimating your potential

“Probably the biggest mistake we made early on was not believing the business was going to be a big success. So we did next to no planning ahead, instead just making decisions as they were convenient.”

– Collis and Cyan Ta’eed, Founders of Envato

Plan while you can, launch as soon as possible, and make changes as you go

“And, just do it! Planning and modeling out your business is always a good idea, but don’t get stuck planning too long, build something and push it out to your users as fast as you possibly can. If your product is getting good reviews and people are willing to pay for it, you’ve got something.”

– Levi Cooperman, Co-founder and VP of Operations of Freshbooks

Finding the right team

“Finding, motivating, and retaining good people has always been a challenge. I think we’ve done a good job at this and it shines through in Simple’s product and customer experience. I don’t have much wisdom to share beyond acknowledging that it’s difficult. One tip I can offer is to be incredibly passionate. Hopefully your passion will inspire other like-minded people who are smarter than you to jump on board.

“Hire great people… then get out of their way. You should strive to hire people who are smarter than you and, if you succeed, they will get irritated when you get in their way. Delegate and keep your eye on the important stuff.”

– Shamir Karkal, CFO and Co-founder of Simple

Listening to your users/customers

“Customer feedback has been critical to our success from the beginning. We occasionally would push out features that were a bad user experience and made our service worse not better and our users told us right away when something was wrong. In fact, our first version included a feedback form upon logout and that along with phone calls gave us plenty of information to learn from. The key in those early days (and even now) was to be nimble and open to feedback.”

Watch your pennies, but spend the good ones

“On a more philosophical note: Sweat the pennies when it comes to expenses, but at the same time don’t be afraid to back yourself and invest when you think it’s important. If you’re bootstrapping, or don’t think you’ll be able to raise a lot of funds, you’re probably better off starting a business when can feasibly make actual revenue early on – i.e. don’t go for a consumer-oriented home run business like Facebook!”