By Tarik Voirin and Tim Martino
Innovation and entrepreneurship are on the agenda in Australia and the prospects for talented young innovators to take their ideas and products to market are brighter than ever.
But what should young entrepreneurs know before starting a business? There are inherent pitfalls in entrepreneurship but a few key points and considerations can help you navigate the challenges and give yourself the best chance of success.
1. Select your business partners carefully
A great number of startups fail due to business partners pushing it in different directions or ending up in protracted disputes that destroy value. Trust is key.
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Having smart and ambitious business partners is great, but if you don’t have mutual trust, a shared vision and an ability to get along and work together then your new business will be built on very shaky foundations indeed.
2. Networking is crucial
Good networking not only gives you access to potential customers and investors but also to valuable advice and assistance from a broad cross-section of the business community, some of whom may ultimately become your mentors or trusted advisors.
At its best, networking is disinterested, in the sense that it should be based on a recognition that everyone has the potential to be of assistance in the future, even if their field seems far removed from your own and every opportunity to help out a contact is likewise an opportunity to help yourself.
In business good karma makes all the difference.
3. Get a mentor
It is normal to focus on the glamorous aspects of being an entrepreneur. But being an entrepreneur will also mean enduring periods of loneliness, frustration, disorientation and self-doubt.
In the face of these challenges, finding a mentor who can provide support and encouragement even in your darkest days can be the all-important difference between success and failure.
4. A good idea is nothing without good execution
Every great idea is on the verge of being stupid and vice versa. Great execution is vital.
You can always pivot from ideas, but if you are a poor executor your great idea isn’t going to save you.
Good execution requires the utmost persistence, self-discipline and determination, recognising that this is essentially an exercise in continuous problem-solving.
If you reach a deadlock in your execution, then pivot your idea. If you can solve enough problems surrounding your idea, then you’ll likely find success at the end of the tunnel.
Also remember that you don’t need to do it all alone. That is what your networks, trusted advisors and mentors are for.
So long as you can achieve good execution as a team, leveraging your respective strengths, you will be putting yourself in the best possible position for success.
5. Tackle failure head-on
You will definitely encounter failure as an entrepreneur. The key is how you respond to that failure.
Truly successful entrepreneurs, instead of giving up, reflect on their failures as sources of valuable new knowledge and then, armed with that new knowledge, they persevere.
The old saying is also true: If you’re going to fail, fail fast.
It’s generally just not worth producing perfectly polished products as your first attempts to test feasibility in the startup phase. If you then turn around and find there is no demand for your product or, worse still, someone else has beaten you to the market, you’ll have wasted a lot of time and money.
By contrast, designing products fast with enough features to deliver the essential value proposition – a minimum viable product – will allow you to get quick feedback from your customers and either pivot until you get the right product for the market or alternatively recognise that a product is just not going to gain traction and go back to the drawing board.
Tarik Voirin is a product process engineer at WineApp.
Tim Martino is a senior manager at Pitcher Partners WA.