Let’s face it: You have to be a little bit crazy to be an entrepreneur.
While most of us appreciate nothing more than the steady comfort of a regular paycheck and a well-structured routine, entrepreneurs are attracted to more extreme emotions. They need the highs of seeing their vision come true, and they’re unafraid of the lows of witnessing their dreams crash to the ground.
But the very same personality traits that so often bring us innovative and beloved companies can also lead creative and talented people to torpedo their business before it even takes off. Here, then, are seven deadly “sins” entrepreneurs commit much too often.
1. Splitting equity: Anyone who has graduated kindergarten knows all about the importance of sharing, working together and getting along with others. But when it comes to starting companies, that instinct can be problematic. Try to split the equity in the company equally between its co-founders and, almost guaranteed, you’ll soon enough come to a stalemate.
That’s because in business, like in every other realm of life, someone has to have the final say. That means, even if salaries and skill sets are all alike, someone has to be the boss and make the call, especially with young businesses that grow and change rapidly. Rather than fearing that very, very awkward conversation with your partner, have it early and move on.
2. Building a product without a robust go-to-market strategy. Here’s one movie you should definitely not take as your guide to business:Field of Dreams. That famous line—“if you build it, they will come”—is about the worst piece of advice you can give an entrepreneur. Sadly, too many entrepreneurs heed it, regardless.
Being excited about your product is necessary for a start-up. Believing in it is indispensable. But launching a company without a solid plan for distributing your product is business suicide. Never do it.
3. Ignoring the known unknowns. Self-confidence is every entrepreneur’s secret sauce. It’s the quality that helps you shine in meetings with investors or potential clients.
But self-confidence is a double-edged sword. Like every living person, entrepreneurs have blind spots. Thah is fine, as long as they know exactly what they don’t know and surround themselves with co-founders, employees, advisors, anyone who can help fill in the blanks.
The moment you begin to think that you know everything, the moment you ignore the many, many things you haven’t the foggiest clue about, is the moment you open yourself up to disaster.
4. Not trusting your gut. So knowledge is important, but gut feeling — that impossible-to-describe hunch that just signals to us sometimes and suggests the right course of action — is, too.
Because they’ve risked everything to get their business started, founders have very strong instincts about what is right and isn’t right for them professionally. That applies to strategy, staffing and just about every other decision a founder can make. Entrepreneurs should learn to trust these feelings.
That isn’t an invitation to do whatever you damn please, all the time. As the boss, you should be rigorous in your thinking and deliberate in your decision-making. But if your gut is telling you something, stop and listen.
5. Failing to assign roles and responsibilities. It’s a truth, universally acknowledged, that an entrepreneur does everything. Start a new company, and you’ll find yourself developing product, servicing clients, writing website copy and running to the bank to deposit checks
Because they have so many responsibilities, at least early on in the game, and such a passion to see every aspect of their business succeed, entrepreneurs very frequently fail miserably at assigning clear roles and responsibilities to the their team. That’s a pity. Without clear directions, it’s very hard for employees to meet their targets. Job descriptions should be clear, concise and evolve as frequently as the company does.
6. Avoiding fierce conversations. Sure, entrepreneurs are often passionate, intense people. But they also tend to be outgoing and collaborative in nature, which means that they, like most normal human beings, dread confrontation. Sadly, confrontation is often needed, especially when trying to define the course of a new business. Avoiding awkward or confrontational discussions today will create exponentially bigger problems tomorrow: if something is not right, dig in immediately.
7. Letting whims create whiplash. As the founder, you care about your company dearly. That means that you seek out, and get, input and feedback from people all the time. It also means that you are thinking about your business 24/7, and always have new ideas.
That is great, if you have a framework for you and your team to deal with these bursts of inspiration. Otherwise, you’re likely to just create whiplash by always attacking the new, shiny thing. Don’t exhausting yourself and the company’s resources chasing the latest whim rather than following a systematic, well-laid plan.