There’s always a huge buzz surrounding new movies: movie posters are plastered everywhere, there’s a million trailers on TV, lines form outside the movie theaters—everyone’s excited for opening night. If only startup companies worked that way. Maybe they would if they had access to movie studio-caliber marketing, but the reality for most startups is that they’ve got to kick and scratch to build street cred, hype, and cashflow—and they’ve got to do it fast before the money runs out.
If you run a startup company, or if you’re planning on launching a startup, there are a few important mistakes you need to avoid lest your business become a box office bomb. Here are 5 common mistakes that startup companies make.
1. Failure To Utilize SEO
You don’t need to plaster posters across the city to get people to know about your company. SEO can be your most effective marketing strategy so long as you employ it correctly.
For the uninitiated, SEO stands for “search engine optimization.” It’s the practice of making your website more noticeable on searches. Google, for example, runs its famous PageRank algorithm on its site; good SEO could position a webpage within Google’s top ten search results.
SEO is both simple to learn, and complicated to employ. But if you want people to know that your startup is open for business, you should at least learn the SEO basics so you can try and boost your visibility to relevant online consumers.
2. Hiring Bad Employees
Bad employees can sink a startup business, simple as that. Startups don’t have a solid cashflow, like more established businesses, so they need hugely committed employees who can wear multiple hats (because the company doesn’t have enough money for a larger staff). Your employees also need to be enthusiastic about promoting your brand anywhere and everywhere. Lazy or unenthusiastic employees at a startup are harmful to any business, but especially at a startup company where you don’t have a lot of staff to begin with.
The easiest way to avoid hiring bad employees is to utilize employment screening services. These services will run background checks on prospective employees to make sure they have no criminal record, and that their identity checks out.
So far as the “enthusiastic employee” thing goes, don’t just conduct an interview—run an audition. Have your job applicant perform a task that would be similar to what they’ll do at your company (you might have to pay them a small stipend for that). The better employees will really shine given those kinds of tasks.
3. No Strategic Partnerships
Strategic partnerships are one of the best ways to promote your business and gain a small stream of customers or clients. A strategic partnership is a partnership you make with a company that’s larger and well-established. These companies have a larger customer base that they can share with you.
Obviously, you can’t form a strategic partnership with a competing business. Your two businesses need to have different products with different business models, but they also need to complement each other. If you’re running a microbrewery, you might want to make a partnership with a popular local bar; they’ll stock your beer, and you’ll provide a discount for them. So long as the bar likes your product, both of you would benefit from the deal—you get a wider exposure to customers, while the bar gets a new product for a cheaper price.
You can use strategic networking software to help you make connections with businesses that would make for suitable partners.
4. Growing Too Fast
Many startup companies make the mistake of growing too fast: they hire too many employees than what they can afford, or they invest in expensive new products when they haven’t gained a steady cashflow from the first product. If your business is going to succeed, you should learn how to grow your startup debt-free. It’s tough to expand your company when you’re still in debt from the initial financing. That doesn’t mean that you hold off business development until you reimburse investors. But you should focus on stabilizing your company’s finances before you take off running with them.
5. Oversized Office
An office is often one of the heftiest expenses for a small business, and many startups shoot themselves in the foot by renting an office space that’s much too large for the small number of staff that are employed. The startups think they’ll grow quickly, and they rent a larger office in a bid to get ahead of the game. But larger offices are more expensive, and they can drain a significant amount of money from a startup, money that could be put to better use in marketing or business development.
Consider renting a customizable office space, like those offered at WeWork. These spaces can be easily made small, medium-sized, or large. If your company grows too large for your current office size, you can simply pay to expand the size of your space. There aren’t any leases that you’re bound to, which is a big plus.
Let's Do Launch
Launching a startup is a process filled with obstacles and mistakes. But now that you know these common startup mistakes, you’re going to be less likely to repeat them! Best of luck on your startup launch.
