Living the life of an entrepreneur and owning your own business is the dream of many. You set your own hours, you earn money strictly for yourself (and the government), and you have the pulse of the marketplace. Despite the advantages of being an entrepreneur, small business owners tend to make some pretty stupid mistakes that would leave us average folk scratching our heads.
Indeed, being an entrepreneur isn’t for everyone, and these common mistakes prove it. In other words, just because you own your own business doesn’t mean you should sleep in until noon or spend time at your home office browsing porn. If this is your idea of what being an entrepreneur is then perhaps you should go back to your ex-boss and ask for your old job back.
On the other hand, we all make mistakes. Nobody is perfect. It’s important that you learn from those errors and correct them as you go along. If you don’t then you’ll become another part of this head-turning statistic: nine out of 10 businesses close within 18 months.
Here are 10 stupid mistakes entrepreneurs make:
See Also: 5 Common Legal Mistakes for Startups
1. Spending Money You Don't Have
Understanding the financials of your business, not your personal bank account, is imperative. Dealing with revenues, cash-flows, and debt servicing payments is an essential aspect of being an entrepreneur. When you start spending money you don’t have then you immediately place your business at a disadvantage. Indeed, most businesses have lines of credit, but the best option is to hardly use it. Once your business is in the red, it slowly inches closer to bankruptcy.
2. Working But Not Really Working
You’re sporting a suit. You have a smartphone in your hand. You have your e-mail inbox open on your monitor. You may be sitting in your own office and you definitely look like you’re working, but you’re not really. You’re just looking the part. Instead, you’re browsing through Twitter, watching YouTube videos, and sending out the occasional business email.
What’s worse is that you only got to your desk at 1pm and now you’re going to get ready to leave by 5pm. That’s only four hours of just showing up (see below)!
3. Not Spending Enough Time on the Business
For some reason, entrepreneurs actually think they can make a successful business by working only a few hours a day, four times per week. This is the wrong attitude to have. You’ll read about entrepreneurs working 12 hours a day, six times a week on their business to make it grow and flourish. If you thought that you could become an entrepreneur by working very little then you’re sorely mistaken. You should treat your business like you would working for a company: work business hours and beyond, and dedicate yourself to the business at hand.
4. Assuming Contracts Will Be Honored
Indeed, written and signed contracts should be ironclad. With this logic, we assume that contracts will be honored. Unfortunately, this isn’t reality and another client or business can easily get out of their obligations. There’s always some fine print somewhere. You have to be prepared for this to happen. You’ll quickly learn that not everyone is well-intended, respectful, and moral.
5. Being Too Formal and Serious with EVERYONE
There’s being professional, and then there’s being ultra-serious like Raymond Burr or Laurence Olivier!
When you own a business, you should definitely be mature and professional about it, but you shouldn’t take yourself too seriously, and this means being too formal and too serious. This kind of behavior will certainly put off potential customers and those you wish to work with in the future.
Show some personality, but don’t be Rodney Dangerfield. Show some kindness, but don’t be Mother Teresa.
6. Avoiding Face-to-Face Meetings
Today’s generation of professionals wants to communicate primarily through text or e-mail. They don’t want to talk to you on the phone or meet you in person. This is certainly eroding our personal and soft skills, but that’s life. If you fall into this camp then you should immediately reverse this trend. Most people still want to hold face-to-face meetings, but if you resist then you will potentially miss out on much needed revenues and profits.
Go ahead, pick up that phone. It won’t bite.
7. The Greatest Story NEVER Told
You own a business and, of course, you have a website. But your website is just too generic. It has a list of your products or services, your contact information, and links to your social media. Where’s your story? A business that has a personal story will certainly draw in more eyeballs and customers than one that seems to be established by a robot.
We all have stories to tell. Why did you start this business? Who encouraged you? What do you wish to accomplish? It’s these things that add the personal touch, something that’s very important to a large chunk of consumers.
8. You're Not Gathering the Pulse of the Public
A successful entrepreneur will know what the public wants. A successful entrepreneur will notice trends in the economy before many of the fat cats on Wall Street or Silicon Valley do. Simply put: a successful entrepreneur has their finger on the pulse of the general public all the time. If you don’t, then you may as well close up shop today because you’re wasting time, energy, and dollars.
9. Where's the Follow-Up?
Most people in the world of business will agree to the fact that getting a meeting with a huge company or an important person when you start out is next to impossible. However, what’s worse is that when you get the initial meeting, you don’t follow up to get a second. You simply take the individual for granted and you conclude that you shall play the waiting game. This is the wrong approach.
No matter how well or bad the interview went, you should always send them a follow-up message thanking them for their time and expressing your hopes of doing business with them in the near future.
10. A Strong Love Affair with Your Product/Service
Some entrepreneurs are too in love with themselves and their products. Although being proud of one’s ability is a good thing, if you have too much passion for your product then this will cause you to be biased about the item and never modify it. The main purpose of the business is to fulfill the demands of the customer and not to satisfy your own ego.
In the end, your love affair with your product or service may be the downfall of your company. End it now, and be open to adjustments and revisions.
Entrepreneurs are essential to the growth of an economy. The more there is competition, the better off everybody is. Just imagine if there was just Microsoft and there wasn’t Apple or BlackBerry. Would we have the smartphone? Maybe, maybe not. Entrepreneurs are necessary to the wellbeing of consumers. But some aren’t cut out to be an entrepreneur. If everyone was, there would be no such thing as an employee; there would only be business owners.
An entrepreneur, especially one that is just starting out, is entitled to make mistakes. As long as they learn from those mistakes and correct them, they will go on to be successful. Hard work, ability, and a little bit of luck will go very far in the world of business.
As an entrepreneur, what mistakes have you made and how did you learn from them? Let us know in the comments section!