With the start-up boom over the last decade, more and more people are gearing up to quit their day jobs and pursue careers that align more with what they desire. However, while chasing your dreams is often justified, it is important to do so in a way that spells caution. The best way to start off on the right foot is to know why so many start-ups tend to fail within their first few years. Some of the reasons are:
1. Not investing in credible employees
By striving to save every penny, start-ups often make the mistake of hiring the cheapest possible employees and then asking them to produce work that is on par with their competitors. This does not work out because the lowest paid employees often are the greenest and do require a certain amount of handholding and help during their first few years. By investing in manager level employees who not only spot bad work a mile away, but can also train your employees and help them grow, you ensure that you have a lower attrition rate, higher success rate, and all round growth.
2. Starting for the sake of it
While it is understandable to be inspired by other agencies that are doing well, establishing your own start-up just because you want to earn more isn’t always going to lead you to success. Many people plead guilty of jumping on the bandwagon and just hoping for the best. When you don’t have enough experience in your field, or enough experience running a business and managing other people, things can go south very quickly. It’s always better to delay the launch of your company by a few years and stay where you are just to learn more, rather than being in a hurry to start your company.
3. Not being prepared for the financial uncertainty
When you’ve got a job, you’ve got that monthly paycheck. But when you’re running a business, establishing a consistent bottom line, let alone one that justifies your time and energy, can take a while. Many people don’t expect the process to take very long and hope that things get sorted financially within a few months. This happens rarely. As a result, people get frustrated, pressure their team, and often quit way before they achieve anything solid. The temptation of a paycheck that you can count on can often be too much.