With the public entrepreneurship, the slogan of innovation is proposed, the era of entrepreneurship is coming, and the tide of entrepreneurship is in full swing. Successful entrepreneurship, stood in the air, grabbed the pain points, and obtained financing. After the launch, it was sought after by the market.
However, there are very few successful companies in the startup, and most of them are sloppy. Or can not enter the market, or the investment can not successfully exit; or forced to sell assets, low-cost acquisitions and so on. According to relevant statistics, the success rate of college students’ entrepreneurship is only 2%, and the business failure rate of enterprises is as high as 70%.
Entrepreneurship has never been done overnight. We will encounter various obstacles. In the four-way incubator, we will help interpret the traps in entrepreneurship from the perspective of investors.
First, the pseudo-demand pain point
The biggest reason for the failure of startups is blind entry into the market and the lack of products to meet user needs. Market conditions are not yet mature, overestimating market share; underestimating industry bottlenecks; users have low demand for products; market homogenization products are severe; and excessive expansion of individual elements has led to project failure.
In-depth market research, assess whether the project is an emerging industry or a sunset industry, determine the risk of entry; comprehensively understand the user’s consumer demand, frequency and pain point satisfaction, accurate positioning; understand the situation of competitors, determine the odds and find the right business ideas.
Second, the capital chain breaks
When the partner’s investment is not in place, it will start blindly. Before any substantial progress is made, the company is eager to recruit troops and the funds will soon be exhausted. Even if they are lucky enough to get financing, they will find a short runway. Without a stable source of recurring revenue, it has to pay high wage costs, operating costs, and poor cash flow, resulting in the company being bankrupted and liquidated.
The shareholding funds must be managed reasonably, a unified account should be set up to manage the system, and the funds should be allocated, approved, and disbursed rationally. The financing guarantees that they will not lose control in the future, properly manage and rationally use the funds, and prevent emergency situations such as investors withdrawing or customers not paying. Appear to ensure synergy between investment short-term profitability and long-term development.
Third, the lack of a viable business model
Business model is a necessary condition for a startup to succeed. A large part of the failed startups is caused by imperfect business models, and the company’s business cannot be rolled up according to the goals. A sound business model determines the direction of entrepreneurship, so that companies do not deviate from the track at high speeds.
Entrepreneurs from the analysis of the target audience to the evaluation of the company’s cash flow, from the company’s development or provision of product services to the timetable set for the goal, the development of a feasible business plan, loyal to the goal to implement carefully.
Fourth, the product is too bad
Some entrepreneurial founders may be good at marketing or technology, but there are shortcomings in terms of products. Blind development of new products leads to the death of the project without systematic layout, market positioning, talent matching, brand planning, and channel operations! Good products create user value, core functions have obvious advantages, and can form a closed-loop ecology, in order to form a sustainable purchasing power, which is the key and fundamental of marketing.
Before the development of new products, we will build a team of professional teams, find a company with good reputation and do strategic cooperation and development, complete the development and iteration of products quickly and efficiently, and continue to move toward the ultimate goal of good products.
Fifth, marketing is too bad
If a good product is unknown, then the startup project will still fail. Marketing must consider cost and return. Every company wants to use the least amount of money for the biggest effect, especially for start-ups where funds should be short, limited by contacts, experience, resources, and higher cost of trial and error for enterprise products. .
Good products need good channels for marketing, but they don’t have to wait until the products are good to go to marketing. Instead, they should constantly improve their iterations in marketing, and choose the marketing methods that are most effective and suitable for the company.
Sixth, the partnership team parted ways
Having a reliable team and entrepreneurial partner is the key to entrepreneurial success. The failure team lacks project-focused talent. The partners of many startup companies are old classmates and friends. It is the ideal partner in terms of reason, but this relationship has many contradictions in the later management and profit distribution.
Entrepreneurship selects professionally proficient people to partner, leaving options or shares, from the pre-employment period to the late stage of profitability, partners must maintain a consistent mentality. Based on their respective resource advantages in different fields, they will quickly promote the overall process development.
Seven, poor management
The probability of a business project aborting due to poor management of energy is very high. Leaders inside and outside, small and small affairs, no matter how close, personally, do not give power to subordinates; or too trust, completely sheep management; or safe and can not be dangerous, eliminated by competitors and so on.
Business leaders must master the principle of principle, have a strong, stable, diversified and qualified team, and have a sound management system and a reasonable and effective interest distribution mechanism. Fully grasp the real situation of the market, company, employees, and projects, and adjust business strategies in a timely manner.
Eight, the site is not ideal
The geographical location has a huge impact on startups. The correct location is the key, and it is one of the core competitiveness of the high success rate of entrepreneurship. It is a bad failure to ignore the market saturation, the location of consumer users, the work of employees, and the location of financing development.
At the same time, the enterprise entrepreneurial site should consider the cost, potential customers, and the entire industry, and whether there is consistency and regionality between the product concept and the location. Many successful start-up companies have long-term development for enterprises, choosing high-tech parks, incubators, space creation, and investment institutions.
In the enterprise entrepreneurship road, we need unremitting efforts and risk aversion, and we need a perfect growth incubation system. A good incubator will make the company’s dreams and development more effective. In the Sifang Business Incubator, Zhiyi is committed to helping small and medium-sized enterprises to solve the trap of entrepreneurial traps, providing one-stop services such as market research, Internet development, marketing promotion, e-commerce operation, government fund and investment fund support, and industry channel docking for the settled enterprises. Investigate for entrepreneurs and start-ups to create an Internet + era industrial ecosystem.