Entrepreneurship is a true test of resilience. Nobody starts a business because of the 90% failure rate, rather in spite of it– you believe your idea is unique enough to beat the odds. But things are bound to go wrong for even the most successful entrepreneurs and though it’s painful, failure is a right of passage in this world. In this session, we talked about why so many businesses fail, and what we can learn from others’ mistakes.
Ascertain not just the cost of opening your business, but staying in business, at least until you can survive on sales revenue.
1. Your startup’s oxygen is running low
Inadequate funds are a top reason businesses close their doors. Colin pointed out that you could have the best idea in the world but without the money, you don’t have that “oxygen” your startup needs. Finances and funding need to be sustainable in order to hire, advertise, and scale, so implementing a budget and financial strategy early on is important. Ascertain not just the cost of opening your business, but staying in business, at least until you can survive on sales revenue.
“You can’t outsource the entrepreneur.”COLIN C. CAMPBELL
2. Who cuts the cake?
Management and the systems in place are also to blame for many companies going under. Who you hire early on matters– and be clear on why you hired them. We discussed with the audience a ‘too many cooks in the kitchen’ scenario with no one really in charge. Someone has to have the final say, or days would be spent discussing ideas with no execution. While you want a team that works closely and well with each other, be intentional about delegating tasks and expectations. It’s crucial to devote time to developing a strong business plan and forming a management team before putting your plan into motion.
Be sure to listen to the full replay above for even more lessons on failure and resilience in entrepreneurship.