5 Mistakes New Entrepreneurs Make

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This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process.

Opinions expressed by Entrepreneur contributors are their own.

Have you ever wondered why many entrepreneurs fail ? It is normal that everyone wants to taste the honeys of entrepreneurship, but not everyone is willing to pay the price.

According to figures from the Global Entrepreneurship Index 2018, Mexico fell four places in said survey, from position 75 to 71, which it occupied a year ago, due to the low evaluations it received in the areas of cultural support, perception of business opportunities and entrepreneurial skills.

Due to this situation, I explain the five most common mistakes that some entrepreneurs make when starting their business, as well as not making them:

1. Lack of commitment to your dream

Some people want to undertake to earn more money, others want to do it to add more value to the lives of others. Those who just want to win money usually lose the game. However, those who want to generate more value in the lives of others are those who usually earn it. Therefore, it is important that you are 100% committed to your dream, only then will you have the necessary energy to overcome the ups and downs that occur at the beginning of any undertaking.

2. Business Model

This is the biggest mistake of incubators. “They tell you that the first thing you need is a business plan, when the first thing you need is a Business Model,” says the author of Map of Wealth. A model that meshes all parts of your business and guarantees that you make money.

Remember the first thing is the business model and then your business plan.

3. Product or Service vs Sales

Focusing on the product or service instead of focusing on sales is one of the most frequent mistakes. Almost everyone starts their business as operators and not as salespeople, that is, they start out focused on their product and service.

Sometimes when they take it to the market, they find that the market does not want what they offer. Then they think they can change the mindset of the market, spend money trying to change the mindset of the market, and end up destroying their company.

Focus on sales! First research what the market wants and then build it or get it through your product or service.

4. Money Management

Business finances are a reflection of the personal finances of an entrepreneur. The main challenge of startups is called cash flow, even so, many entrepreneurs spend all the money that the company comes in and most of the time they do it in their lifestyle instead of reinvesting it to generate more cash flow . This means that the company does not reach its full potential and in a short time disappears. Learning to handle money before receiving it in large quantities is key to the future of any entrepreneur.          

5. Accelerated Implementation

When you start a business there is a time to philosophize and another time to implement. At the beginning it is good to clarify ideas and then it is important to implement them and make them come true.

The problem for many entrepreneurs is that they never let go of the philosophical part and spend it changing ideas that they will never be able to materialize.

My recommendation is implement, implement, implement! 80% of businesses do not survive the first 3 years of life. If you take these recommendations into account and avoid falling into one of these five mistakes, you will increase your probability of survival in the market and increase the chances that the business you dreamed of will come true.

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