Every year several entrepreneurs start their own business but out of that only few succeeds and rest fails. However, one should never feel bogged down due to such failures; rather they must try to analyze the reason for the failure and should learn from their previous mistakes. Starting a new business is not that easy as it seems. It requires proper management of capital and manpower. This article talks about the lessons that one can learn from start-up failures so that the budding entrepreneurs can avoid such mistakes.
Validation of the product or services
It is very important to validate the popularity of the new product or services with the customers before actually launching the product in the market. It can be done through customer surveys or sample product distribution to check the outcome and customer feedback on the product or service. In most of the cases, it has been observed that the start-up fails to validate the product or service idea with the customers and ends up making a product that nobody wants to buy.
Mutual understanding between the co-founders
In start-up businesses, it is very important to have a mutual and clear understanding between the co-founders. Sometimes it happens that the co-founders do not agree to a particular decision due to which the business suffers.
Avoid overspending on unnecessary things
Many entrepreneurs choose to spend unnecessarily on the certain things that are not so fruitful for the business. It has been seen in some cases that the founder spends more money in buying an expensive office space which is not required immediately. Overspending can lead to drying up the funds that could be used to push the business to next level.
Choosing right investor
It is always advisable to choose the investor who has experience in investing money in start-ups. Inexperienced investors can lead the company to dead end. The investor investing money in a start-up must share the same philosophy, vision and aim.
Powerful marketing tactics
Few entrepreneurs work tremendously hard to develop a product that has the capability to be popular among the customer. However, spending too much time in product development is not advisable. It is equally important to spend money, energy and time on marketing tactics. Many start-ups with great product and services fail due to lack of marketing and advertising. The aspiring entrepreneurs must always keep this in mind that marketing of the product is extremely important.
Ignoring customer feedback
The grave mistake that many start-ups commit is to ignore the customer feedback. Customer feedback helps the business to overcome the shortcoming and address the weak areas. It is one of the important lessons to be learnt from a start-up failure. In the age of social media, it is very important to address the distress of an unsatisfied customer. In many cases, it has been observed that an unsatisfied customer leaves negative feedback that influences several potential customers and their buying behavior.
The above-mentioned points can help the aspiring entrepreneurs to learn from the start-up failure.