Seven startup misconceptions

I came across an article listing seven misconceptions often perpetuated by people unaware of the need to do a bit of research or to listen to those who have experience;  or, I regret to say, too attached to their need to be right to be able to accept that they could do something better.

Misconception number 1:  You Don’t Need to Be an Expert in Your Field

(Why must Americans capitalise every word?)

This conflates two different, and equally important misconceptions.

It’s true that, to take the example of the startup restaurant, you do need to be able to cook and serve decent meals.

But you also need to be able (not just know how to be able) to run a business.  I’m sure that a failure to do this well enough accounts for many start up failures.

Misconception 2:  You Don’t Need Tons of Money to Start a Business

Time and again I have seen small businesses crippled by their failure to do enough marketing.  And to do good enough marketing.  Take two examples:

1 Websites.  Most small businesses’ websites fall the wrong side of mediocre.  There is, apparently, no understanding of the purpose of the business’s site and, technically, they are usually poorly designed visually and navigationally.  The startup needs to pay a good web developer, who understands about user experience (never mind search engine optimisation), to do the job.   (Or delay the development of a website until a later stage of the business.)

2 Networking.  Most people starting small businesses believe they need to go to networking events, and many of them do.  However, few of them appear to have a sensible reason for being there or to understand how to go about achieving it.  As a result, they waste their time and that of other people there.

Most businesses, at start up, are under-capitalised, and their owners discover they do not have the funds to do the basic things described above (and many others, of course).

Misconception 3:  There is a Perfect Time to Start a Business

The time to start a business is when

• you have done enough research to have a degree of confidence that the business will fly (big enough market, attractive enough products and services)
• you have a coherent and ratified business plan
• you have the startup capital you think you will need plus a contingency of, at the very least, 50% and preferably several times what you think.

Misconception  4:  You Need to Quit Your Job to Start a Business

Well, that depends on the job and it depends on the business.  However, you do not have to quit before you start the business and a personal need to have a transition period may determine what the business does, at least to start with.

Misconception 5:  All You Need is Passion

The word “passion” has been overused to the point of meaninglessness.  And, it’s not necessarily passion that is needed.

But the article conflates “passion” for doing the job (cooking food, for example) with “passion” for running the business.  As pointed out above, it’s the latter that is needed because it is, too often, in short supply.

However, there is a third area where “passion” is certainly needed.  That is the area of customer service.  I daresay the need is far greater in the UK than in the US, where the article was published, but here I estimate that, probably, 90% of businesses need to be better at this and 50% are poor to the point that they adversely affect their business by the level of customer service they offer.

Misconception 6: Marketing is Expensive

Marketing need not be expensive, though good marketing advice may be and that is what is needed.   You can’t substitute good marketing with “a lot of marketing tactics [which] you can do yourself, like blogging, using social media, or sending email marketing campaigns”, as the original article suggested.

The first two (blogging and social media) risk undermining the business (I recommend the maxim “Better keep your mouth shut and be thought a fool than open it and remove all doubt”).

As for email marketing campaigns:  please, NO!  Most “professional” email marketers’ efforts are dire.  If you don’t believe me, read this (and this blog and this blog).

Finally, misconception 7:  There’s Nothing Left to Learn

And this is because the start up business owner doesn’t know what he/she doesn’t know and therefore doesn’t know where to turn for relevant information.

I am afraid I don’t think it’s the case that “Once you launch your business, you’ve likely read every book, blog, and magazine on starting a business known to man [sic]”.  My point above is that it’s all too likely that someone starts a business with too low a level of knowledge, let alone understanding of what is involved.

by Jeremy Marchant . © 2016 Jeremy Marchant Limited . uploaded 20 april 2016 . image: Free images
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