What Startup Entrepreneurs Are Doing Wrong

Patents and Market Definition

All startups know that patenting their product protects it, but up to what extent? You need to ask yourself if the patent covers your product from competition with the same product/service that will not violate any patenting rights, meaning if another company comes into the market with the same product, will yours be totally wiped out because customers do not care who solves their solution as long as it’s sorted out? This is what market definition is based on. Your patent has to define your target market so well and have a long-term strategy for where your business is at now, and where it will grow to in coming years, regardless of which other competitor comes along. You have to be the first company/firm called upon to solve a problem your startup was created to curb.

Copying Others

So you have a brilliant idea, well so did someone else. You decide to Google the working model for another existing business model and you execute it. By execute I mean you literally kill off the business you started because the model may not work where you’re located. Most startup successes stories are spun around the fact that the core purpose of the business caters to a locality where it is needed. It solves a problem there. Your startup business has to do exactly that, provide a solution for your region, and hopefully even to the world. Yes, other startups may join an already existing pool, but what current are you swimming with? The danger in copying others is that you may horribly flop within a few months because you have not identified you target market and also haven’t researched on how consumers would like their problems solved. There is also the glitch in consumer willingness to try out your ‘new’ copycat product because they already have a solution. In the end you face monetization problems and make a loss.

Seeking Quick Rewards Without Calculating the Risks

There’s always risks with any new venture and these should be put forward initially, before you even start drooling at the rewards you’ll get off of them. One thing you should know is they are usually relative, the greater the risk, the greater the turnover if the project works.  Get risk management advice from people you know have wisdom about entrepreneurship but remember, what worked for them might not work for you so always be alert to the factors that could make YOUR product/service the next big thing.

Overspending

How much are you spending on your operational costs? Firstly the money you are spending may not be yours, it may be from investors seeking a return on investment (RoI). How you spend their money may affect their decision to inject more or retract from the business. Spend wisely. Save where you can. That doesn’t mean start using cheap products, but try and find something that will cost you less than what you have put on your budget that still has some quality. Cut off all unnecessary costs. Get power saving bulbs if your electricity bills are too high. Write down a list of all your expenses, see which ones can be reduced and put the new solution in place.

Depending on Government

The common “boma itiyanganepo” (government should step in) mentality needs to stop. You will probably have a harder time pitching to a government entity to work with you than it could be with private sector investors. The truth is, most people in the private sector may have been startups themselves and know the risks involved. They may help you on an entrepreneurial level deeper than the government could. Granted, the government has initiatives that fund or lend loans to some entrepreneurs, but business support may end there. You need to figure out a way to keep a working relationship with mentor-like partners. They are valuable tools to any startup in the first 5 hard years. Try and get outside funding if you have to. There are more open-minded investors in highly developed countries who would be excited to join forces with you. Be careful however that you do not lose your own goals for the business if an investor starts to feel like they ‘own’ you and dictates to you. Stand your ground. It was your startup idea in the first place. If you feel like your original goals won’t be met using one route, try another. Startups are all about trial until they don’t err.