I was going to start by saying there are two types of entrepreneurs, but that’s not really supported by the evidence. There are, however, two types of people who work for themselves, and only one type chooses to refer to themselves as entrepreneurs.
The distinction is important. When you think of an entrepreneur, what do you think of? The stereotype is an energetic person with a lot of passion…for making money. He or she may not have an interest in the product of service being sold, as long as it’s profitable. This is why there are so many serial entrepreneurs – they pursue what’s hot at the moment. And there’s nothing wrong with this. It requires flexibility to jump from project to project quickly. These people are quick to identify and analyze an opportunity. They’re charming, they know all kinds of people, and they DO tend to make money, at least for a while.
But study after study suggests that the actual “typical” entrepreneur is a very different creature. Research in micro business and startups shows that somewhere between 85 and 97% of all people who launch a business of their own do so, not to get rich, but because they’re passionate about the product or service. The money is nice, but never the top (or even second) priority. They have experience in their industry, they’re less impulsive and more committed.
With that distinction in mind, I submit that the following mistakes are more likely to be made by the first group, and more likely to be dangerous to the first group. And while you may not be as numerous, you’re much more visible. That can be a benefit, as long as you don’t screw it up by making one of these mistakes:
Worst Mistake #1: not knowing how to market appropriately.
I have a contact who is pushing 40 years old. Most of his connections are in the 25-40 age bracket. He jumped on some get-paid-to-advertise-to-your-connections bandwagon and I got – no joke – 27 posts from him in the space of 15 minutes over the weekend – all for spring break packages in Mexico. There are so many things wrong with this.
1.A: Know your audience. People mostly in their 30’s aren’t interested in sending their 12-year-olds to Cabo or Cancun. Target that to college students. College students with passports who are ignorant of the increased likelihood of prison, beheadings, rape, and disappearance. That’s your audience.
1.B: It’s social media – you should let people know what you do. But there’s a difference between the occasional reminder or announcement and spammy exploitation. The rule of thumb tends to be that no more than 1 in 7 to 10 posts should be selling anything, depending on the network and your audience. If you feel the need to defend the frequency of your sales pitch posts, you’re overdoing it.
Worst Mistake #2: not caring about what you’re selling.
Nootropics, for example, are of interest right now. Unfortunately, in actual scientific research (not the 12 people tested in a company-sponsored study), those pills don’t make you smarter, just a little more focused. Just like another cup of coffee, because, gee, caffeine is a nootropic drug. (Deer antler spray – oh dear God, seriously?) At the very least, do your research so you don’t look like an idiot for hustling snake oil. Selling “real” fake followers? Please. Whatever you get involved with, make it legitimate. Your reputation, your family, and your financial situation depend on you making informed decisions.
Worst Mistake #3: not approaching your business like a business.
The rule is esse quam videri, meaning to be rather than to seem. If you want to be seen as a business person, you have to actually be one. That means determining your legal structure, getting your business name registered, getting your business license, writing out a business plan, getting insurance and a bank account set up, getting a dedicated phone line/website/email, and all those other things legitimate businesses do. If you think you can ignore it, or get it all done in a weekend, you’re not a startup, you’re a fool. Anyone can start a business, but 26% of all small businesses fail because of a lack of business expertise, another 25% because of financial problems – both of which could have been avoided if would-be entrepreneurs had done a little prep work. (Read this post for the number one reason your start-up is likely to fail.)
Worst Mistake #4: neglecting your communication skills.
This is the most-demanded skill in business, but many start-ups ignore written communication skills. I’ve seen one self-proclaimed entrepreneur bragging about how he’s so excited and busy that he can’t take time to spell-check before posting. If you’re producing content loaded with spelling, grammar, and punctuation errors at the rate of 3.5 words to 1 error, spell-check isn’t going to solve the problem. Excitement isn’t the problem. Let’s be honest: you have very poor skills. I’m not a translator of illiterate-speak, and neither is your audience. We’ll forgive a typo. But we judge you for knowing your skills suck and not doing anything about it.
Have you seen an example of one of these? Is there a mistake that needs to be added – something you’ve noticed or maybe something you wish you’d done differently? Please comment and share on Twitter, Facebook, G+, LinkedIn … wherever you may have a young and impressionable would-be entrepreneur about to make a mistake!