Many startups fail in the first few years of business because of mistakes that entrepreneurs can avoid. Entrepreneurs come up with brilliant ideas especially in the tech field, but the ideas do not turn into large businesses. Some entrepreneurs are simply unaware of the mistakes to avoid in their first ventures while others ignore advice from other entrepreneurs. If you are in the process of starting a tech company, here are some mistakes that will cause your startup to fail or incur losses.
1. Obsessing Over Your Product
Most entrepreneurs join the tech industry after developing a unique product. Your product could be innovative and impressive, but it is not enough to build a successful business. You need to have a holistic approach when building your business. Find practical strategies including marketing strategies that will push your product in the market. Remember that other creative ideas can emerge at any time. While you obsess over your product, another tech genius can create a similar product and push you out of the market. Develop and implement marketing strategies that will inform your target buyers of your product as you develop its quality and effectiveness. Sometimes first-time entrepreneurs are in a hurry to scale their business even before they build a strong presence in the market.
2. Underestimating the Contribution of Employees
Many entrepreneurs go into business with the aim of impressing their target market with their products. Hence, all their resources and strategies revolve around impressing clients. Such business owners ignore or underestimate the importance of a competent staff. If you developed your software, app or gadget from scratch, you may not overlook the competence of your employees.
Many startups are also surprisingly lax in their vetting process. Such an approach is risky for a tech startup. Zenefits, a software startup in California recently made the headlines for a similar mistake. According to an article that was featured on the beacontranscript.com, the company incurred a fine of $7 million for allowing unlicensed employees to sell health insurance. Hire qualified and licensed professionals in your business to avoid similar legal issues.
3. Assuming That Your Product is Complete or Perfect
You have a functional website, software, or mobile app with positive reviews from your clients. The next thought that may come to mind is to scale your business and reach more clients. A good tech product is never complete. You must upgrade or update your product continually to match the updates on the platforms that users access your product. For instance, if your product is running on IOS, you must update it every time the mobile platform is updated. Otherwise, your product will be outdated within a short period. Look for creative ways to make your product better and more useful to your clients. Give your clients new reasons to use your product with every update.
You can build a successful tech startup by learning from other successful entrepreneurs. If you have already established your tech business, check if you are making any of the mistakes discussed above and correct them to avoid losses.