You must be willing to jump into the market headfirst and view every failure as a great lesson to be saved for later use if you want to succeed as an entrepreneur. Throughout Kaizen’s many trials with entrepreneurs and startups, we have managed to generate several profitable businesses, which is a thriving journey fraught with missteps.
According to the Small Business Association, fifty percent of small enterprises collapse within five years, ceasing all activities. What can you do to prevent your business from failing to compete with others? The trick is to remodel your business idea, without excluding its original vision, into one that can help your firm succeed.
First, you need to know every fish that lurks in the sea—the primary players and stakeholders in your startup ecosystem, which includes new business owners, mentors, incubators, sources of talent including colleges and businesses, investors, and support services like startup-friendly law and accounting firms. It also includes investors.
Many companies underinvest in market research out of concern that it will be costly and time-consuming—or, worse yet, that it will show that there isn’t a market for their idea at all. But let me tell you, nothing is more costly or time-consuming than a failed venture.
One of our favorite ways to test a market without spending a ton of money is to just speak with real people who are in your target market to hear their true requirements in their own words, and there are many other ways to do this as well. About 20% of unsuccessful entrepreneurs blame their failure on a poor product-market fit; avoid turning into one of them!
Once you have an idea you’re confident there’s a market for, it’s time to make a plan. Many businesses fail because their owners don’t take the time to make a plan and stick to it. Making a plan is necessary once you are certain that there is a market for your idea. Due to a lack of time spent developing and adhering to a plan, many businesses fail. And I’m not referring to a lengthy business plan that will be stored in a drawer and gather dust. I’m referring to a dynamic, tactical document that outlines your overarching objectives, establishes the company’s framework, and specifies growth benchmarks. You might discover that you start to think of questions that prospective investors would ask as you develop your proposal.