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We all experience failure at some point in our lives.<\/p>\n
As entrepreneurs, the looming fear of failure is all too real.<\/p>\n
We’re excited when we first think of a great business idea<\/a> and sit down to write a business plan<\/a>.<\/p>\n That excitement only grows when you start your business<\/a>.<\/p>\n But then reality sets in.\u00a0According to Forbes<\/a>, nine out of ten startups will fail within their first few years of operation. This means that it is more common for a business to fail than for a business to succeed, pinning the odds of success against us.<\/p>\n Some argue that failure is overrated<\/a> and that you should learn from success:<\/p>\n You can learn a great deal more from success than from failure. Here’s why: Knowing what not to do helps you focus and avoid setbacks, but doesn’t help you adapt to changes. You know what didn’t work \u2014 does that help you next time when you need to figure out what will work? If you ask successful entrepreneurs whether they would rather hire someone who has failed or someone who has succeeded, I suspect most would prefer to hire the person who has succeeded. This is not surprising \u2014 scientific research<\/a> shows that we learn more from success than from failure.<\/p><\/blockquote>\n But, since many more people fail than succeed, it\u2019s important to learn from both success and failure.<\/p>\n In fact, the most successful entrepreneurs are willing to take risks and to fail<\/a>. After all, risks create opportunities, and opportunities often lead to success. (a word of caution here: not every failure is a learning experience<\/a>).<\/p>\n Ultimately, the learning process (from success and failure) is cumulative. Melinda Emerson, one of the leading small business experts in America, recently wrote in her blog, Succeed As Your Own Boss<\/a>:<\/p>\n Success is a cumulative process. In other words, you have to start today and do a lot of little things right every single day before you can finally create a track record of achievement that will cause people to see you as successful. The same is true of failure. Some failures can be catastrophic, for sure, but failure is not fatal until it becomes one in a series of many that define your daily lifestyle and your character.<\/p><\/blockquote>\n One of the first questions investors ask in a pitch meeting is, \u201cWho are your competitors?\u201d<\/p>\n Often, startups answer that they don\u2019t have any because their market is so unique that no one has entered the space.<\/p>\n In a world of millions of businesses, that\u2019s hard to believe.<\/p>\n The truth is that startups always have at least one competitor, even if the competition is indirect.<\/p>\n People jump on good ideas, so the chance of being the first to have one of the uniquely great ideas is low.<\/p>\n Receive six actionable guides, including a how to start a business checklist, detailed comparisons of LLCs, corporations, sole proprietorships, and partnerships to determine the best fit for your business, plus insights on crafting a compelling pitch deck to attract investors.<\/p> Receive six actionable guides, including a how to start a business checklist, detailed comparisons of LLCs, corporations, sole proprietorships, and partnerships to determine the best fit for your business, plus insights on crafting a compelling pitch deck to attract investors.<\/p> Receive six actionable guides, including a how to start a business checklist, detailed comparisons of LLCs, corporations, sole proprietorships, and partnerships to determine the best fit for your business, plus insights on crafting a compelling pitch deck to attract investors.<\/p> The key to a good startup is tackling a good idea from a new angle that makes the startup stand out from the sea of others trying to enter the same space.<\/p>\n Yet, many startups ignore this insight and attempt to launch their businesses in small, niche markets.<\/p>\n But when a market is too small, it becomes difficult to make recurring profits and survive as a business. By focusing on \u201cgreat products\u201d and ignoring the market size, entrepreneurs fall into the trap of creating something great that nobody wants.<\/p>\n Marc Andreessen, General Partner at Andreessen Horowitz, echoes this idea in one of his LinkedIn posts<\/a>:<\/p>\n Conversely, in a terrible market, you can have the best product in the world and an absolutely killer team, and it doesn’t matter \u2014 you’re going to fail.<\/p><\/blockquote>\n Andreessen highlights two other important aspects of a successful business. Even though he claims that having a great team and product aren\u2019t enough, there is still value to be found in strong teams and products.<\/p>\n How can you determine the market size for your product or service? We recommend you read How To Choose a Market For Your Startup Or Small Business<\/a> and Tips on Defining The Size of a Market for a Startup Business<\/a>.<\/p>\n Smart entrepreneurs know that timing is everything, causing them to propel their companies forward as fast as possible.<\/p>\n While this seems like a good idea at first glance, it hurts many young companies in retrospect.<\/p>\n When details like company culture and team fit are overlooked, startups end up with many smart people who can\u2019t work together.<\/p>\n A study<\/a> on fit in the workplace found that individuals who have a better cultural fit in the workplace will perform better overall than their peers who don\u2019t fit well. The study found that people who fit in with their company are also more likely to work better in teams, contributing more to the company than those who don\u2019t fit in.<\/p>\n Therefore, teams in sync can problem-solve and collaborate more easily and quickly than teams out of sync.<\/p>\n This means that small businesses and startups should allocate more time to choosing their teams. For example, at crowdspring, we conduct several rounds of interviews when looking to fill a position.<\/p>\n One of these interview rounds always includes what we call a \u201cculture fit\u201d interview, where we try to determine how well a candidate will fit in with the rest of the team.<\/p>\n We believe that determining the \u201cright\u201d person for the job is not exclusive to making sure that they have the technical skills for the position, but also to make sure that their motivations, mindset, attitude, etc., align with the rest of the team and the company\u2019s goals.<\/p>\n If the candidate doesn\u2019t work out culturally, the chances are that no technical skills could make up for the culture gap. Mark Murphy, author of Hiring for Attitude<\/a>, agrees in an interview with Forbes<\/a>:<\/p>\n For example, a newly hired executive may have the intelligence, business experience and financial acumen to fit well in a new role. But if that same executive has an authoritarian, hard-driving style, and they\u2019re being hired into a social culture where happiness and camaraderie are paramount, that combination is unlikely to work.<\/p><\/blockquote>\n So while an extra round of interviews may slightly prolong the hiring process, it prevents many conflicts, slowness, and overall frustration. Smart companies that focus on building a strong culture see an increase in efficiency and product quality.<\/p>\n But be careful not to confuse culture with perks. Many things considered \u201ccompany culture\u201d are not. Rand Fishkin\u00a0wrote an excellent post about this topic on the Moz blog: What Company Culture IS and IS NOT<\/a>.<\/p>\nHere are two of the biggest mistakes most businesses make, and what you can learn from those mistakes:<\/h2>\n
1. Creating a good product – for an obscure market niche.<\/h3>\n
Free Business Startup Kit<\/h2>
Get your free startup kit<\/i><\/a><\/div><\/div><\/div>Free Business Startup Kit<\/h2>
Get your free startup kit<\/i><\/a><\/div><\/div><\/div>Free Business Startup Kit<\/h2>
Get your free startup kit<\/i><\/a><\/div><\/div><\/div><\/p>\n2. Not enough time spent building the team.<\/h3>\n
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