Tuesday, January 21, 2014

How to avoid the most popular startup mistakes

Learning from other entrepreneurs' mistakes is a great way to minimize what you get wrong.

Learning from other people's mistakes can be a great way to minimize your own.

One of the biggest mistakes an entrepreneur can make is getting caught up in the moment: running with your idea or opportunity and spending time and money on developing it rather than taking a step back and thinking to yourself: "Is my idea really a viable business?"

It is natural when you have an idea, or are presented with a business opportunity, to get excited. It is, however, absolutely vital for you to do your research. Know the market. Do your due diligence. Think carefully before taking the plunge. When I took over Benjys; the high street sandwich chain, I lost £100,000 a week for six months before I had the conviction to shut it down. This was down to me getting too excited by my idea, jumping in without researching whether it was a viable business.

That said, when we first started up Hamilton Bradshaw, we over-analysed one particular deal to death. Six months down the line, we decided not to go ahead with the deal. This deflated morale hugely and, although I knew that it was absolutely the right decision, I could not stop asking myself why it took us so long to reach that conclusion. The answer: we had been so drawn into the detail that we had forgotten to ask the right, simple question - is it a viable business? So when you are doing your research make sure you are asking the right questions from the outset. Don't get bogged down in the details and look at the bigger picture. One of the best pieces of advice I have ever been given is this: if you're going to fail, make sure it happens quickly.

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