A bad idea, gross mismanagement, or a poor work ethic can kill a startup before it’s out the gate. But there are other things founders often overlook that can kill their businesses–or severely hamper it–a little later down the road.
The problem with these things is they become either difficult to fix or totally unfixable if you wait too long. On the bright side, none are extremely difficult to handle if dealt with early on. Here’s a rundown of five often overlooked items that can bite you bad.
1. What comes next?
Many founders become so obsessed with their initial vision they fail to give any consideration to their next stage. Forward momentum and growth are baseline requirements for business success, no matter how high you set your sights. Whether your goal is to establish a local presence, or you’re laying the foundation for a nationwide enterprise, you need to have a vision for how your business will move forward.
Another reason to be prepared is to protect your business from future competitors. Right now you might not have competition, but one day there will likely be competitors that will do what you’re doing right now—and just as well as you. And because they will be entering the field later than you, they’ll more likely have a sense of “what’s next.”
Planning ahead can take you down several different roads, and you may want to experiment with a few of them. By the way, if you’re planning to go for venture capital initially, your plans for growth will be one of the questions you’ll be asked to address.
2. What’s your online identity?
Whether you’re founding an electric bicycle shop on the corner, an e-commerce operation, or a service you intend to take national, much of your marketing will be conducted online. Prospects will relate to you through your online presence, so you need to decide early on what that presence looks like and sounds like.
Along with the blueprint for your digital marketing strategy, you need to create a guide that defines the look, feel, and sound of your digital marketing materials. There are many ways a marketing plan can fail, and some are immediately obvious in retrospect. This includes having an inconsistent voice, which won’t jump out at you as the reason why your marketing isn’t meeting your expectations. Further, it’s difficult to correct when you’ve let it slide. Take care of it upfront.
3. Are you properly insured?
None of us loves the idea of buying insurance. But it’s one of those things that when you need it, you need it badly. And since a fledgling business can be knocked out of the game very easily, startups need to be sure they have the proper business insurance.
This even applies to home-based businesses. I know a guy who works from home and also owns some rental properties. Occasionally, a renter will come to his home to pay rent. Over the course of a year, one of his tenants who pays in person told him how she was filing “slip and fall” suits against two local businesses. He wisely decided he needed to contact his insurance agent and get a rider to cover the amount of business that he conducts with people at his residence, as well as any equipment he uses solely for business purposes.
I’d like to also specifically mention disaster insurance here. When a flood, tornado, or earthquake hit an area, they don’t skip over new businesses.
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4. Are you creating the right company culture?
Many founders start their projects with a “do whatever it takes” attitude. This is understandable and you want to be high-energy and totally focused on your goals. However, you don’t want to end up with a team of jerks or lone rangers who will walk over others or play fast and loose with the truth.
Your goal should always be long-term growth and success. This depends in large part on the tone you set ,and then make sure you hold your team to it. If you set the wrong tone, you can create a culture that will not function well beyond your early startup days.
This is one of the reasons we see so many founders and founding team members replaced soon after the organization hits its early milestones.
5. Do you have a coach or mentor?
Founders can get so caught up in themselves and their visions they end up discounting the need to connect with a good coach or mentor. Even the most successful professional athletes have coaches; let that fact be a lesson for you.
Take the time to find a good business mentor early in your planning stages. You’ll get invaluable guidance, accountability, and encouragement from this professional. In fact, your mentor will probably help you avoid the four previous errors I’ve discussed here.
Finally, let me say a little about emotions and human nature. When we’re working on something brand new, like founding a business, the excitement level runs high. Things change after the initial success, and making progress often becomes much more difficult.
If you overlook one or more of the five points I’ve covered, that compounds the difficulty of taking your business to the next level. So, as the Boy Scouts say: Be prepared.