Over the past decade, there’s been a dramatic growth in the startup ecosystem. Essentially, anyone can start a business so long as they have the passion, patience, and dedication. In fact, there’s been a rise in startups dedicated to helping new startups overcome the barrier to entry much quicker. For instance, LegalZoom is one such company that makes launching an official business easier than ever; within an hour or two, you can have a legal company set up and get ready to work.
However, while launching a startup is easy enough, building a successful company takes more work. Software startup companies are faced with a unique and particular set of challenges. These entrepreneurs have visions rooted in technology and may be seeking to make innovative and disruptive changes, but the fact remains that there are much more ideas than there are investor dollars. To really compete in the startup world, it’s crucial that you take precaution and avoid tell-tale mistakes. With that in mind, here are some common startup mistakes you’ll want to avoid:
Not Having a Technical Founder
While many businesses have been able to grow without a technical founder, this is typically not the norm. Technical founders will make your position as a business much easier and much more cost-effective. These founders understand relevant programming languages. They can manage a Helm repository by JFrog just as easily as you can pitch a product, for instance. Having a multi-faceted team also looks much better to investors. As a software company, outsourcing your software development efforts won’t sit well with key investors or potential stakeholders. They want to know that your team is cohesive and in-house.
Premature Scaling
How a business scales can make or break them. Scaling a business refers to the ability to support the growth of a company. The majority of startups are fragile, and how you control growth can make a big difference. For instance, if you suddenly secured funding from an investor, you should be wary about quickly throwing all your money into fast growth. There are many startups that have busted because they had too much money and didn’t take the time to understand how gradual growth could be key in building a sustainable business.
Ignoring Design Aspects
Software startups may be rooted in technology, but they are captured by design. The best software in the world will likely be ignored if it doesn’t capture the eye. First impressions are make or break in today’s business environment, where companies have mere seconds to capture consumer attention. Start thinking about design early on in the development stages, working closely with your design and development team and ensuring that they remain closely linked. On the same token of design, be sure that your design is intuitive for the user to create a seamless experience.
Ignoring the Value Proposition
The last thing you want is to create a product that no one wants. There are many startups that have launched to dead markets, realizing far too late that there simply wasn’t an audience for their product or service, or that it wasn’t the right time to announce that product or service. Your product should align with a real solution that’s needed in the world.
Often, if you do the research, you’ll find several companies that already do what you hope to do, and that have the funding to get there much quicker. Ask yourself how your business differs from your competition if this is the case. Test your assumptions in various ways. Talk to potential customers and test your product early on to really gauge whether this is something that’s needed.
Falling Victim to Cognitive Biases
Cognitive biases can certainly cloud your decision-making—particularly when it comes to making business decisions. A cognitive bias is a way that you think about the world or a situation that may not reflect the reality of the situation. There are many types of cognitive bias. For instance, confirmation bias is the tendency to search for information that confirms preconceived thoughts or notions.
If you already believe that millennials will be the primary market for your product based on feedback from your millennial friend group, you might continue to search for evidence that supports this assumption. To avoid falling into cognitive bias traps, do your best to think outside of the box. Talk to people whose ideas and values are inherently different than your own and do your due diligence.
