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Why is it that success stories get told and retold? Because the rate of success—especially in business—is generally much lower than that of failure. However, it doesn’t mean that stories of failure or near-failure cannot be just as instructive, if not more so than the most dazzling stories of success. That’s what I am going to share with you in this post.
Back in 2015, I and a couple of friends started something that was intended to be the biggest thing in my life: a business of my own, something I dreamt about since I was in middle school. It was a digital marketing agency—not because I was particularly passionate about social media or marketing but because it seemed like a natural thing to do on hearing neverending success stories of guys just like me making it big in this industry. Also, it felt easier than trying to actually develop and sell our product.
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It was a bumpy ride, and we’ve finally done okay – not big, but okay, and on looking back at all this I am sincerely amazed we didn’t go bankrupt in a month. But one thing is for certain – we’ve learned a lot. And now you can do so, as well. Here are the mistakes we’ve made that will bring your business down unless you are as lucky as we were (but don’t count on it):
Not Having Enough Expertise
When we started out, neither my friends nor I had any significant knowledge of digital marketing. We overconfidently believed that we would figure things out as we go along – and very quickly realized that we were in over our heads. Hectic search for real experts followed, and here we stumbled upon a new problem – as we weren’t very skilled on our own we had no benchmark to compare applicants to – everybody who could talk smoothly looked like a lifelong expert to us.
Takeaway: don’t start a business dealing with something you have no knowledge about. Although you don’t have to be an expert yourself, at least one of your starting members should have an excellent idea about the technical side of the things.
Not Considering Credit Funds
The most common problem we had to deal with was constant lack of money. We weren’t able to turn enough profit to break even for months, our startup budget was running dry, and most additional options for attracting extra funds were already tried. At one point we could have seriously improved our situation if we were able to get a small business loan, but nobody was able to fulfill the requirements.
Takeaway: Before you even consider starting a business you should make sure you have a good credit rating (get rid of all your debt pronto) and sufficient annual income. The higher your credit scope, the lower can your income be.
Relying on Interns
What can be better for a young, struggling business than young, struggling talented people, especially if they are ready to work (almost) for free? As it turns out, a lot of things. While interns can help you out in a lot of situations, trying to build your workforce around them (like we did) when you don’t have battle-seasoned senior managers to oversee them is a recipe for disaster.
Takeaway: Hire interns sparingly. Don’t believe them to solve all your problems. Concentrate on getting experienced specialists first.
Not Keeping an Eye on the Industry.
Everything changes quickly today, and digital marketing is among the fastest developing industries in existence. We believed that some initial knowledge plus experience acquired along the way are enough to succeed in this line of work. In reality, a lot of changes happen overnight, and if you are not ready to take immediate measures, you are going to take a fall.
Takeaway: read industry-related publications, follow blogs of industry influencers, participate in seminars and webinars, keep an eye on the news. Be ready to sudden changes.
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This is not a comprehensive list of mistakes we made but these brought us the most grief. If you concentrate on avoiding them, you are much more likely to be alright than if you go in blindly.
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Photo credit: Getty Images