5 Most Common Startup Mistakes
In the era of “BREAKING NEWS” with big numbers flashing in front of our eyes through our feeds on how a 22-year-old kid just closed an investment round of 15 million, it becomes harder to stay focused on what is essential for your company. With that in mind, it becomes easier to copy to be recognised by the entire world. Or you could build your own path, and probably nobody will ever hear about you.
By working with startups and building my own product on the side, several things keep re-appearing. Mistakes we still make, which are easy to spot, but hard to avoid. Of course, there are many more, but these come only from my own experience and practice.
It sounds romantic when you think of yourself as the David vs Goliath. But how many actually won the fight? A handful? Out of how many millions? We are tempted to say that we will disrupt one of the Fortune 100 companies, or we will go after the biggest player in the market and so on. But what most of us don’t realise is that you get unwanted attention. Attention which brings more trouble. Unless you have infinite amount of money, you won’t win the game against the big players with big budgets.
Yet, the word “Disrupt” transformed itself into a buzzword which we throw to left and right, to show how cool we are. For you, it may seem something trendy, but for others, in the same market, it is a threat. Think of Napster, a company founded by Sean Parker and Shawn Fanning (1999). They went for the big players in the music industry. A year later they made it to the front cover of Time magazine. And a year after, they made it to court filing bankruptcy.
Competition is poison
It can make you hallucinate opportunities. People have a tendency to flock around stuff that doesn’t smell right, but we do it because others do it. When you are in your own mind and don’t mind others, it can save you from getting caught up in crowds competing for obvious prizes.
Inside a firm, people become focused on what others do and lose sight of why they started things or why they do what they do. You get into a “conflict” with your competitors of who does it first or better. But all conflicts, from retrospect, are avoidable if you don’t allow your own ego to get in the way. And just focus on your product.
For example, in 2010, Square released a small square shaped add-on for your smartphone which could allow anyone to swipe their credit cards via the iPhone. Then things started growing up and other companies began doing the same thing. Intuit built their own card reader in a cylindrical form. In 2012, Paypal launched its own reader shaped in the form of a triangle. This will not end until we run out of shapes.
The last will be first
It’s a pretty non-sense thing when we live in a market where everybody wants to be first on the market with their ideas. “Nobody has done it before! We will be first!” Sure, but how many companies do you remember that were first? As far as I can see, you don’t use products that were first on the market, but ones which meet your needs better than the competition. Products that do it better than others.
What matters is generating cash-flow in the future, and not having a “first mover advantage”. It is much better to be the last on the market and then enjoy decades of monopoly rather than scraping each cent you can because you did not plan accordingly in the beginning.
Ask people what they don’t want
When building a product, we are tempted to always think in terms of:
What people want?
What else do they need?
What other feature can we add to improve the overall experience?
What would make this product more useful to you?
This also applies to reasearch and surveys we send out to users. Instead, try to think from a different perspective. Ask your users or customers:
What else can we take out to improve the quality of our product?
If you could remove one feature, what it would be?
What don’t you use?
What gets in your way?
Sometimes, leaving stuff out is the best favour you can do to your customers. And I agree with you, it is hard to do it, as the human mind has a tendency to addition not subtraction. I say it from my own experience when building my product. You always want to add that extra feature because it is cool, or nobody has done it before. But we all know that great products come on top because they are great at doing one thing but better than others.
Less mass to product and company
The reason why we stop thinking like in “the early days” or we stop “innovating” is mostly because we add more mass to our company or product.
Things that add more mass:
Hadware or software lock-in
Things that reduce the mass:
Shorter or less meetings
Commiting to delivering on time/budget
Less product features
Smaller team size
Admitting mistakes early on
Multi-tasking team members (skills)
Less mass is a state of mind which allows you to change course easily without going through a bureacratic process. In case a good idea pops next day, you can drop what doesn’t work and embrace a new direction. You can integrate new approach or software, now than later. With less mass you become like a racing car, rather than a truck.