10 Biggest Challenges Faced By Startups In The First Year Of Execution!
Most founders just run with an idea without a careful analysis and without considering the challenges faced by a startup in the first year.
Starting a business can admittedly prove to be quite the preoccupying and yet extremely gratifying endeavour. A start-up, to most people, is a precious opportunity to turn their passions into a palpable reality. However, the path towards this envisioned future is rarely easy. In fact, just the first year of a startup can pose unimagined challenges and complications.
To tell the truth, the first 18 months of a start-up’s life is often referred to as ‘the valley of death’ since most start-ups end up go to the wall during this period. So, if you are just starting out in the world of start-ups or are deliberating establishing one, here is a list of the 10 biggest challenges you are likely to face in the first year of your start-up’s execution:
Identifying The Right Founder-Market Fit
One of the most fundamental aspects of establishing a start-up is ensuring that you get the founder-market (or founder-problem) fit right. Unfortunately, a lot of founders simply take the most seemingly gainful idea and run with it without taking the time to assess if they are the right person with right skills to solve the problem.
It is important that founders resonate with the problem really well in order to be able to solve it.
Building The Right Team
The second most important step in a start-up’s journey is to find the right team that can solve the problem. The team the founder puts together should complement their skills and talents and more importantly connect with their vision of building the startup. The team needs to be equally passionate about the problem being solved.
Not Talking To End-Customers And Others
A large number of founders tend to work on their start-ups discretely, which means they end up spending too much time building what they think is right. Unfortunately, not discussing the idea with others and validating your beliefs/ assumptions, often leads to ‘analysis paralysis’.
It is imperative for founders to share their thoughts, talk to customers, and seek feedback for more clarity on what needs to be solved and how.
Not Understanding The Difference Between Users And Customers
Focusing on building a user base instead of concentrating on the paying customer base early on during a start-up’s life is a move that is most likely to have a disastrously damaging effect on the endeavour. Many founders end up chasing users who would never turn to customers.
Focusing On Vanity Metrics Instead Of Metrics That Actually Have An Impact On The Business
Start-ups often tend to focus on vanity metrics such as app downloads and page visits or Facebook likes instead of paying attention to metrics that really impact the business. Metrics such as the page visits are relevant to startups in media and not startups in other spaces unless page visit directly correlates with business goals. Often people confuse on what metrics really impact business and lose focus.
Not Thinking About The Bigger Picture
It is important to keep an eye on the bigger picture/thought process to grow as a start-up. Think of it as the North Star for your goals — it will help you make the right decisions while you forge the path towards the future. The vision is important for the founding team to align all forces in that direction.
Executing Too Slowly
Start-ups must act fast during the nascent stages. Why? Because considering the probabilities of failures, start-ups need to fail fast in order to learn and then correct themselves quickly. The biggest enemy of a startup is lost time.
Not Experimenting Often Or Enough
Nearly all start-ups deviate considerably from the original plan. Unfortunately, most founders end up sticking to the original hypothesis by assuming instead of validating it through enough experiments. Most of the startups end up pivoting thus making the right experiments all the more important.
Trying To Do Too Many Things At Once
There is no doubt that experimenting is good for the start-up’s health. However, overdo it and you risk hurting your start-up. But also remember to evaluate the experiments and their results thoroughly before discarding it or adopting it.
Not Accepting Failures
In the world of startups, failures are a more common occurrence than success stories. As a start-up’s founder, one must accept failures, rejections, and naysayers and then move on to building the startup ahead.
To a lot of people, the mere idea of establishing your own startup sounds fantastical for it means you get to pursue our own vision, do things your own way and make your own rules. However, the path towards this envisioned future is rarely easy. But knowing, understanding, and anticipating the barriers you may face in the first year of your startup execution can not only help you be prepared to successfully overcome these challenges but possibly also steer clear of some common stumbling blocks.
About The Author: This article is contributed by Prashant Pansare – Serial Entrepreneur & CoFounder at Eagle 10 Ventures.