How Young Entrepreneurs Can Avoid the 7 Biggest Business Mistakes
Everyone makes mistakes in life. That’s why pencils have erasers, apps have “undo” features, and stores have refunds. There’s zero shame in making mistakes. Mistakes help you learn what not to do so you can do better next time.
That said, there are some mistakes in starting or running a business that are so common, you might as well learn how to avoid them now. Your predecessors and peers have already made these mistakes. Learn from them so you don’t continue the cycle.
1. HANDLING MONEY
We’re not saying don’t handle money. Every young entrepreneur needs capital to get started and must spend money to get up and running.
But when dealing with the financial reality of starting and running your own business, there are two mistakes newbies tend to make:
- Spending too much
- Not spending enough
In the first instance, young entrepreneurs underestimate how much it will cost to start their businesses. They forget to factor in emergencies and unforeseen expenses. This is why writing out a business plan can help you. Factor in extra cash for every aspect of your business and set up a healthy emergency fund. Eliminate bells and whistles you don’t need right away.
The opposite of spending too much is not spending enough. While saving money where you can is always a good idea, you also need to figure out what’s worth the extra cash. For example, website hosting sites offer many similar features. Your only concern there is which host feels right for your needs, not necessarily which one is the cheapest. However, there’s no substitute for hiring a quality team to help you with things like logos or using high-quality materials to make your product.
2. DON’T OVERTHINK IT
Starting a new business has a lot of moving parts. Young entrepreneurs need to consider target customers, competition, social media, product pricing, finances, and more. You can easily become overwhelmed by the sheer volume of things you have to do and the decisions you need to make. This is when the common phrase, “K.I.S.S.” comes into play, aka Keep It Simple, Stupid. (We know you’re not stupid. You wouldn’t be reading this blog if you weren’t extremely bright.)
In other words, when faced with too many choices, pick the simplest option. Instead of setting up a website with 12 pages of products and information, try to limit yourself to 3 or 4. Rather than posting your product on every social media platform available, pick 1 or 2 that you know are popular with your target customers.
Once your business reaches certain success milestones, there will be time and money to expand. But for now, keep it simple, you bright young entrepreneur.
3. BE ORGANIZED
Some of you might thrive in chaos, and that’s fine. We’re not anti-chaos. Chaos is as much a part of life as the sun rising in the east and setting in the west. But young entrepreneurs need to minimize chaos when it comes to starting a business from scratch. Timelines keep you on track. Goals keep you focused. Marketing plans help attract customers. Budgets keep you from going broke.
No matter how “fly by the seat of your pants” you are elsewhere in life, learn some basic organizational skills if you want to be a successful young entrepreneur.
4. FEAR OF FAILURE
There may be successful entrepreneurs out there who never had a failure, never suffered a loss, or never had to leave something behind for the sake of moving forward. If you know of one of these mythical creatures, let us know.
Meanwhile, the rest of us must face the possibility of failure at any time. Even the best, brightest, and richest founders and CEOs have failed at something.
The mistake some startup entrepreneurs make is thinking that failure is the end of the road. They then become so scared of failure that they never get started. Fortune favors the bold. You can’t become a success if you’re afraid to fail.
5. THINKING THAT YOU ARE A UNIQUE BUTTERFLY
If you’ve thought of a great idea for a business, chances are someone else has thought of it, too. Don’t be so secretive or precious about your idea that you undermine yourself. Yes, ideas get stolen. That’s life. That’s business. But if you’re so preoccupied with your idea being stolen that it prevents you from finding investors or creating partnerships, then you have a problem.
Researching others who’ve had your idea is actually helpful. Learn what they did wrong and improve on it. Find out what makes your competitors appealing. Use the information you gather on similar business ideas to make yours the best it can be.
6. PRICE YOUR PRODUCT OR SERVICE COMPETITIVELY
There’s a tendency for new businesses to either overvalue or undervalue their products. For young entrepreneurs like you who are new to business, the tendency is to undervalue. Many newbies are so afraid of scaring away potential customers that they price their products or services far below what they’re worth.
While you don’t want to swing too far in the opposite direction and price yourself out of the market, make sure you give your product a price that’s fair to both your customer and you. What does everyone else charge? What unique benefits do you offer that justify your price?
7. DON’T LOSE FOCUS OF THE REST OF YOUR LIFE
We’ve never heard anyone say that running a business is easy and takes up very little time. (And if anyone has said that, we don’t trust them.)
Young entrepreneurs are ambitious and high-achieving. That means you are already busy with school, activities, family, and friends. Now throw all the work of preparing and launching a new business on top of everything else. As the new and exciting thing in your life, you might forget about everything else. Try not to let it take over your life. At this point, your startup should be a fun side hustle, not the center of your universe.
Keep these mistakes in mind and do your best to avoid making them. It may not be easy, but we promise it’ll be worth it!
The Kantner Foundation offers college scholarships to young Florida entrepreneurs. Ready to learn more? Click here to see if you are eligible!