There are so many things that entrepreneurs have on their mind at any given time, it is expected that sometimes they can drop the ball a little bit. This may mean not responding to an important email or being a bit late with vendor payments. These aren’t great, but hopefully, they don’t have a longlasting impact on your business.
However, there a lot of things that entrepreneurs have to know before they start a business. From simple things like for most businesses, it usually takes at least 18 to 24 months to really get off the ground to the fact that nothing you plan for will ever work out just right and budgets never really work out perfectly.
We put together 5 things that founders should know when they are launching their business.
Giving away free things isn’t a marketing strategy
There is a general misconception in the market that giving away your product for free is great marketing. This is really common for products with a freemium category, which every founder believes is the holy grail of customer acquisition.
Sadly it isn’t and customers won’t be lining the halls to sign up for your free product or service.
Terng Shing from SYNC, a PR and content marketing startup shared, “The fact that a product is free can actually be a turn off for some customers and if you don’t know the brand, how likely are you to give your personal information or download software even if it is free. A proper marketing strategy would be to build a strong brand and grow consumer trust, then provide them a free or freemium service that you can leverage later on to turn them into paying customers.”
We talk to SYNC CEO Terng Shing Chen about using PR for fundraising
Commitment is an issue amongst Co-Founders
You may be the most committed person who lives and breathes your startup from day one. However, do you expect the same from your partners and is that even reasonable?
Being an entrepreneur is a tough and often brutal journey, so you need to know your partner is there with you. Having someone who isn’t fully committed to the journey is a problem and a risk because you need certainty in that area.
Hiring a salesperson doesn’t mean immediate sales
Hiring someone to take over your sales is risky and often comes with unrealistic expectations. Do you know if your product even sells? Is it ready to be sold? Are your expectations in line with the market or are you dreaming of a million in revenue in 6 months?
Startup founders are often oblivious to the realities of the market and how harsh and cold it can be for a new product segment or a new player in the market. Getting sales can be a long road, so it is always a good idea to go out and sell the product yourself, so you know what to expect.
William Gilchrist, CEO and Founder of Sales as a Service startup Konsyg had to share, “90% of salespeople are hired with the wrong perceptions of what they are expected to deliver. Often they are hired by companies without previous sales resources and have seen movies and heard stories of the legendary salesperson who will come in with an enormous amount of revenue without any training because they are ‘just that good’. It’s a myth, salespeople need to be built and ramped into the organization just like any other resource. Structured training and support are key for a salesperson to be successful, however, we tend to find sales is not given the same support resources as other departments.”
Konsyg CEO William Gilchrist says his piece about sales problems in Asia
First to market isn’t crucial
Being first doesn’t guarantee success, neither is it a crucial part of winning market share anymore.
First-movers face the risk and costs of customer education, market volatility and regulatory issues. Those who follow use the roadmap created by the first mover and then take over their market share.
So moral of the story is, don’t focus on being the first, put more focus on being the best at what you do and giving the market a reason to stick with your product or service.
Revenue isn’t a sign of success unless it is growing
Getting to a nice $15,000 monthly revenue is great, but not exactly groundbreaking if you’re looking to build a growing company that will need investment and have to provide returns for said investors.
If your revenue stays steady and doesn’t grow, you need to look at product fit. Having a few happy customers and a whole plethora of disinterested ones, just means you can’t scale your business in its current form. Iterations are required and you have to be able to find a way to make your product more appealing to a wider audience.