Lack of confidence in your self, your product, and your startup is a surefire recipe for disaster.At the other extreme, too much confidence or arrogance can kill you just as fast. It’s always painful when a startup fails, but as a mentor to founders, I would hope that you can learn from these failings and not stumble on the same issues.
I’ve written about these before, but since I see them so often, I thought it might be worth reiterating.
Some startups think business plans are only for investors. In reality, you should do a business plan primarily for yourself, as it forces you to think through all the elements.
If it's not written down, you can't measure it, and thus you can't manage it. Also written plans are much more effective communication to your employees, lawyers, accountants, and other key players in your rollout.
VCs and angel investors hear this one all the time. The investor view is that if you can't find any competitors, either you are not being honest, or you haven't looked, or there isn't any market for your product.
Your funding request will likely go into the circular file.
Just because you included all the features of Facebook, MySpace, Twitter, and LinkedIn in your new social networking product, doesn't mean everyone will love it.
In fact, quite the opposite usually happens, due to complexity and work to switch. Investors like laser focus on a market-need causing real pain.
Usually the reason the big companies are no threat is that the market is too small. Competing with IBM, Microsoft, and other large companies is a very difficult task.
Entrepreneurs who utter this line are kidding themselves. They may think it's bravado, but investors think it's stupidity.
Quite the opposite is really true. Now the real work starts to build a sustainable business.
Now you have to manage to budgets and timelines, and avoid the temptation to splurge a bit on office space or too many new employees.
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