Of course, there are certainly a lot more than ten things that startups often forget to do but for the sake of brevity, I limited myself to ten*. So here is my list.
(* For a more complete list, please refer to: http://www.eqjournal.org/?p=2471.)
Startups forget to:
1. Select the right idea—if their idea is a bad one to begin with, they are going to waste precious years of their lives for nothing. A knowledgeable mentor can help here.
2. Create a business model for the 21st Century that produces great results so that the harder they work, the more money they make—if their business model is bad, they won’t be able to compete effectively with hard charging entrepreneurs from China, India and other Tigers. Maybe their business model can be easily duplicated or dislodged and doesn’t give them a lasting, sustainable competitive advantage and concession or franchise.
3. Add differentiated value, innovation and ‘pixie dust’ to their business models. Create a compelling value proposition and learn how to clearly demonstrate it to customers and clients.
4. The most important decision they make other than actually starting their new enterprise is who they hire and who they surround themselves with—so hire up. It’s people that produce income not assets or ideas, per se, so hire great people that you also like and trust. Remember, don’t be a dilettante; you need real expertise in everything you do: http://www.eqjournal.org/?p=265.
5. Self-capitalize (bootstrap) the new enterprise so that a VC firm or other investors, partners or creditors won’t end up owning it instead of them.
6. Use smart marketing (guerrilla marketing and social marketing) so they can acquire customers and clients cost effectively—if you have to run Super Bowl ads to get your first clients, you’re probably dead anyway.
7. Mass customize products and services using the Internet so that, for the first time in history, they can get custom outputs from standard inputs as well as reverse out some of the work to their clients, customers and suppliers using the Internet so that they create a scalable enterprise that can produce more value than if they simply had a JOB.
8. Find pre-launch and launch customers and sell, sell, sell (or as Ben Affleck said in the film Boiler Room: “ABC”—always be closing). If they have cashflow, they will probably survive. Ever hear of a company with fast rising revenues folding?
9. Execute expertly, show leadership and become a trusted member of their community and business ecology—if they can’t execute and they don’t become a part of their community, it won’t matter how good the idea and business model were, they’re sunk.
10. Make their own rules and set and achieve their goals—people are excellent at achieving their goals if they remember to set some! Successful, fast growing startups track their metrics and hold themselves accountable.