Written by Wendy Mak
I don’t like talking about failure.
But if you’re starting a new side business or got an idea for a career-change, you want to go in with your eyes wide open.
These 3 reasons why start-up’s fail are the common mistakes I see – and I talk about how to avoid them below.
These 3 reasons all relate to initial planning. Doing the groundwork is CRUCIAL when it comes to starting a business.
Picking logo colours, dreaming about how you’d decorate your office and designing business cards may be more fun than mapping out how you will make money. But it’s this initial strategy that will set your business up for success, for life.
Many great entrepreneurs have passion, ambition or drive. But it’s rarely as simple as knowing that we’re good at something, throwing open the doors and hoping that customers will flock in.
If you aren’t a video kind of gal, here’s a quick re-cap (watch the video for the full run-down) of the solid foundation you need:
1. Have (really) clear + specific goals
Not having a very clear idea of what we want to earn, what our business is offering and doing and the structure of the business in 6 months, 12 months, 3 years and 5 years from now is kind of like saying “I know I want to end up in Mexico but I don’t know how to get there, what flights I need to catch, how much it’ll cost or how long it will take”.
To map out your plan + action steps, you need to know your destination (your goals).
2. Know who your target audience is
You might think picking a gender (“I target women”), a couple of age groups (“in their 30’s to 50’s”) is enough to describe your “ideal” customer.
The truth is you need to get MUCH deeper than that.
You want to literally visualise a single, individual person that is THE ideal customer for you. Being too broad means your communications + content + marketing is “all things to all people” and won’t hit the spot with a specific group – which results in lower conversions and lower sales. Being clear on this allows you to market in the RIGHT way because you know who you want to attract (and who you don’t).
3. Know how you make money
I’ve met lots of people that seem “successful” because they have a lot of notoriety – fame, celebrity, reputation, etc – but if you look under the hood, they’re not actually making (enough) money.
No matter what business you’re in, you want a solid profit model – so know what you’re selling, how you’re selling it and how much money you can make from it.
This isn’t from a place of greed – but if you want to make a difference in the world, you need a biz that is profitable and sustainable so that you can continue to do your work and make a positive impact.
Of course there are LOTS of other factors to consider when it comes to starting a business – but these 3 areas will ensure a solid base from which to build on.
As always I’d love to hear from you so join me below in the comments AND / OR share this if you have found it useful!