“Learn from your mistakes.” It’s a good adage to live by, but as an entrepreneur, you don’t want to think about the possibility of failure. Unfortunately, starting a company is a risky proposition, and if you don’t have a solid foundation, eventual failure is a strong possibility. While you don’t want to dwell too much on how you could fail, you can learn a lot about what not to do from those who have failed—by studying what went wrong. Here are 5 lessons entrepreneurs can take from those who came before them—and weren’t successful.
1. Validate Ideas with Customers First
It may seem obvious that you need to make sure your product or service is something that people will actually want to buy, but it’s very easy to get caught up in the excitement of the idea, as John Rampton discovered. After pouring money into his first startup, Just a Five, he found that the product just wasn’t something potential customers wanted. Don’t just focus on what investors want—make sure the product has potential with real customers first. Raising too much money early on can get everyone excited about a product—more excited than anyone with actual purchasing power.
2. Find the RIGHT Investors
It may be tempting to avoid the big guys, and turn to friends, family instead for your fundraising efforts, but this can be a huge mistake. Tigerbow is an example of this faux pas—the investors didn’t know much about the business of growing a company, and weren’t able to offer counsel or step out of the way when necessary. While it might be intimidating to approach angel investors and venture capitalists, you’ll have to find the money with people who know what they’re doing, in order for your company to succeed. Don’t worry, you don’t have to take a trip to Shark Tank—but you do need to be persistent, and find the right investors for your business.
3. Keep Your Long-Term Vision Intact
Always keep in mind: why are you doing what you’re doing? What’s the long-term goal? In order to grow, entrepreneurs need to focus on both growth and maintenance. Meetro, a social network, did well in its original market of Chicago, with the founders creating incredible buzz around the platform. When they tried to expand to the Silicon Valley market, however, they dropped off their efforts in Chicago—which dropped users’ interest in the platform. Moving too fast while losing sight of your long-term vision can cause the hard work you do to fizzle out if it’s not nurtured.
4. Be Adaptable
Planning is essential to building a business, but not everything will go according to plan. Carrie Kerpen knows that stubbornness can be an entrepreneur’s downfall. Be ready to pivot when it’s clear a strategy isn’t working—and let it go.
5. Build a Solid Team
Entrepreneurs are hard-working, resilient, and wear many hats. At a certain point, however, it’s time to relinquish some of that control, and delegating can be difficult. Once you have more money and responsibility than you can handle, it’s time to start discovering your leadership style, and build your star team. You don’t have all the skills you need for success which proves the importance of finding the right people and then letting them do their thing!
Don’t Give Up
While eventually, all of these founders had to give up on their startups, many of them went on to found other companies. It’s important as an entrepreneur to develop the resilience to help your business succeed—and the strength to move on if it’s time for a new project.