We all know the great myths about genius founders who started from the bottom and arrived to the forefront of the industry. Still, failure rates are raising many eyebrows. Tech startups struggle to establish themselves as moneymaking machines and even the best of the best tend to make costly mistakes. And when you possess no experience of running a company, great ideas may not be worth the paper they are written on.
Hiring wrong people
There are some dangerous pitfalls to avoid if you want to hit big in the booming tech market. Awareness about them can make a difference between dazzling success and going under. So, let us start with hiring policy, the mainstay of the early startup phase. You want employees who not only have skills and ambitions, but also share your vision. Thus, it is highly recommended to assess both talent and personality. Likewise, come up with the sound hiring policy and invest time and money in attracting and retaining top talent.
Missing a pillar
The ground you operate on is slippery and you need strong pillars, preferably two or three of them. There should not be too many chiefs and not enough Indians and the recent studies have found that the likelihood of surviving and thriving is much greater with startups that have two founders. The only problem is finding an ideal person to assume the position: You need someone who is capable, hard-working, and endorses the same goals. A joint skill set should at least cover the technical, sales, and marketing areas.
Not handling money flows
No matter how good the incoming cash flow is, you should never forget to charge for your products. In fact, sometimes you are hard-pressed to do so ASAP. Fortunately, you can turn to the practice of invoice factoring, which involves selling the accounts receivable in order to boost the working capital. You can sell the invoices for immediate payment, or secure a revolving line of credit based on an asset loan. The purpose is to obtain the money you would get anyway, but much faster, when you actually need it.
Lack of marketing strategy
For startups that aspire to make a name in the industry, the marketing strategy is paramount. You cannot just build an organization, open its doors, and simply hope that customers will flock to you. In order to draw people in and spread brand awareness, you have to engage in efficient marketing. The good news is that the online marketing has leveled the playing field. From social media to content marketing, there are many ways to embed your promotional messages into the everyday digital reality of people.
Losing touch with the customers
You cannot afford to get caught up in the vision and lose sight of real customer needs. Try to always conduct a thorough market research and test the waters. Try to find a gap in people’s wants and needs and fill it with your offerings. Furthermore, strive to interact with the customers around the clock and soak up their feedback. Keep your fingers on the pulse of consumers who actually need to pay for your products, stay flexible, and be ready to innovate based on the acquired insights.
Rags to riches
The tech industry is ascending to ever new heights, but that does not mean we can afford to get complacent. Twists and turns of the market are a treacherous thing and there is no need to add fuel to the fire with incompetence. Some mistakes are simply too expensive to learn via trial and error process. So, select the right partner, form a stellar team, ensure the financial health of the organization, and spread the word. If you steer clear of the common roadblocks, there should be no stopping you from striking gold.