Challenges Startups Face-Every startup initiator knows from the start that there will be difficulties. But sometimes they can still surprise you, either because you didn’t expect them, aren’t sure how best to respond, or don’t have the resources to deal with them yet. Here are some of the top issues to be aware of to plan and know what to do when they arise.
Money Is One Of The Challenges Startups Face
- Let’s get to the point: Yes, you need money. Unless you’re fortunate and money starts pouring in right away, either from sales or investors, cash will be a problem sooner rather than later.
- And when liquidity problems hit a startup, they can take their toll, delaying significant developments like launching products, hiring key employees, or opening new office space.
- It would help if you needed the capital to fund software or product development, office space, marketing, etc.
- Most of your success will come from that initial investment. So, while it may seem counterintuitive when it comes to mitigating financial risk early on, the last thing a startup needs to cut costs (and downsize) is in its early stages, just when it’s building its energy, have to focus on something else.
- “As leaders, it’s our job to manage time and money to take it to the next level without losing anything. So plan everything before you start so you don’t end up halfway and suddenly fall through the air like Wile E. Coyote trying to sprint down a ravine.
Neglecting Marketing And Sales Is One Of The Challenges Startups Face
Do you use enough resources for marketing and sales? Some startups feel they can ignore these two features entirely, hoping word of mouth will suffice. Or, if it’s a SaaS business, they might believe that online sales will grow organically and actual sales and marketing teams aren’t needed. But it’s a false economy to trust clients who discover you unless you make a concerted effort to nurture them with a properly structured plan to promote your startup.
An easy-to-use website builder like Elementor, Bookmark, or Zyro can be a great resource that you can use to improve your online presence. When you’re confident that your site is up and running, invest your efforts in referencing, but you can help by making sure your site is accessible to search engines and getting your content’s class for the most relevant keys. Using a tool like WooRank can benefit you check the health of your SEO and identifying opportunities to improve your online visibility. And if you’re building your sales and marketing functions from the ground up, take the opportunity to align and integrate them from the ground up as much as possible.
Lack Of Planning Is One Of The Challenges Startups Face
It’s amazing how many startups fail because they “forgot” to plan. Or maybe they planned it but didn’t cover all the bases. Key areas such as sales, development, staffing, skills shortages and financing are not afterthoughts. They should all be part of your business plan from the start. Not only that, you have to plan for the things you can’t plan for. In other words, while you can’t prepare for every eventuality, you need to know what you’re going to do if (not if) things take an unexpected turn. If your business plan is optimistic and doesn’t allow for surprises, you are heading for big trouble. As the saying goes, “If you don’t prepare, prepare to fail”. So don’t put off the details until later.
Finding The Right People Is One Of The Challenges Startups Face
Specific skills are critical not only to the survival of your business but also to its growth. Knowing the exact skills you need and how to engage these vital individuals can be the deciding factor in your startup’s success. For a small team, the recruitment process consumes valuable time that can be spent elsewhere in the company, but on the other hand, not having the right people can lead to serious bottlenecks and delays in launching new products and services. Delays in finding the right staff are costly.
These are robberies that no startup can afford, especially in the beginning. And as your business grows, you may face another tricky HR problem: you realize you’ve employed the wrong people. (Or the right persons in the bad roles.) Such uncomfortable truths can surface as a startup grows and the cracks suddenly seem magnified. That’s why it’s so significant to prioritize your hiring strategy from the start. Then, once you’re clear about what you’re looking for, plan your key hires strategically and think carefully about each role that aligns with the goals you want to achieve.
Time Management Is One Of The Challenges Startups Face
In startups, like in life, you never have enough time. There are a squillion choices to make in just 24 hours a day (and rumour has it some of them should be dedicated to sleep). So start by eliminating or minimizing distractions, anything that gets in the way of your business operations. Focus your time and liveliness on the things that will make the most significant impact.
Ask yourself: what is vital and what can be postponed until tomorrow? What’s stopping your business from growing? Those are the answers you need to grapple with today. And if you’re trying to prioritize, take a tip from former Olympian Ben Hunts-Davis and ask yourself: Does it make the boat go faster? Will that decision or action have significant, measurable, positive results that will help you achieve your goals? Or is it reasonable a “nice to have” to add later? Shut out the noise and effort on the things that move the needle (or boat).
It’s hard to believe, but startup founders, who passionately grew your idea into a business from nothing, can contribute to your problems. The initiators may have developed a great product and set the controls of the entire company in motion, but they can’t do everything. And even if they could, they shouldn’t. It’s not just a matter of time (see Challenge #5); it is a matter of jurisdiction. Good leaders know the scope and limitations of their own experience.
They know that being a great developer, for example, doesn’t necessarily equate to being great at sales/finance/marketing/HR/all the many other things a startup has to do to scale. successful. So if you are a founder, avoid the big mistake of thinking you can do everything on your own. Don’t collect all the work and major decisions for yourself; distribute the workload. Hire other leaders who can fill in your knowledge gaps and hear what they have to say.
Your Comfort Zone
Growing a startup can feel like captivating one step back to take two steps forward. First, you need to wear many different hats (figuratively, at least). Grain is required. And it would help if you stepped out of your comfort zone regularly. So what are you ready to take on? Are you willing to work harder to make your startup a success? Can you convince potential investors if you need financing, for example? And just as important: Is there anything that is non-negotiable for you? Something you don’t want to do? By determining your comfort zone in advance, you can make arrangements if necessary to find team members who enjoy doing the things you are uncomfortable with…
Competitors Is One Of The Challenges Startups Face
No matter how decent your product is, it’s a crowded market. And it’s rising all the time: you won’t be the newcomer on the block for long, and new competitors can change the playing field quickly, so put yourself in a potential client’s shoes and see how you fit in. Why would anybody choose you over your competitors? When it comes to your participants, you need to strike the right balance between “us” and “them.” Not only do you set yourself apart from your competition, but you also need to have confidence in what you bring with you. But you also have to keep an eye on the competition and the (rapidly changing) landscape. Having the right strategy to reflect and adapt to the new reality will determine your success – or your failure.
Mismanagement Is One Of The Challenges Startups Face
One thing startups can’t afford inefficient management. A management team that did well early on can struggle as the startup grows as they test everything from poor sales numbers to market conditions. You need the right people to make the right decisions. (Not coincidentally, Challenge #4 + Challenge #6 = Challenge #10.) In building your leadership team, you need to do two things. (Well, it should do many things, but for this particular point, let’s focus on two.)
First, you need to make sure your team is working well together. To be actual, you need to keep everyone on the same page. One way to do this is to build transparency into your leadership team’s decision-making process so everyone on the team knows how important decisions are taken.
Second, you need to make sure your gear runs smoothly, period. Be true about what works and what doesn’t, and if you spot longer-term underlying issues, fix them as soon as possible before they become bigger problems. It can lead to awkward conversations and even awkward decisions, but strong management is key to steering your startup in the right direction.
Lack Of Mentoring
Maybe you have countless products or ideas but lack the guidance, market experience, or knowledge to take it to the next level. That’s where a leader comes in, with the knowledge and confidence to help you break down the obstacles holding you back. According to Endeavor Insight’s Rhett Morris, 33% of tech founders mentored by successful entrepreneurs have become top performers. Having someone to lean on when important decisions need to be made, or even when you need a sounding board that has been there and done it before, goes a long way.
But not everyone will have contact with mentors. If not, seek the wisdom of inspirational founders you admire from other sources such as books, articles, or podcasts. In the meantime, focus on building your professional network, which can be just as important. And then, when you reach the top, pay up and share your hard-earned wisdom. Now that we’ve shared some of our biggest challenges, we’d love to hear about your startup journey. Has your startup encountered challenging obstacles? How did you manage them? Let us know in the comments below.
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