However optimistic you might be when you start a new business, you need to temper this optimism with a dose of realism. That’s because, sobering though it may seem, most startup businesses fail to last even three years, as TechRound warns.
The good news is that, in heeding and guarding against an array of risks to your startup, you can enhance its chances of long-term success. Here are five common dangers startups face but are also able to reduce.
Problems with cash flow
If it often feels as though your business is leaking money like a sieve, you might not be sufficiently familiar with many fundamentals of achieving a steady cash flow.
You might not understand the difference between cash and profit and the implications for your business. After ascertaining what, on a regular basis, is going out and coming in, you can more easily judge how much funding your firm will need over the next year.
Failing to jump the first hurdle
“So many startups end up in ‘zombie’ states,” Shawn Livermore, founder of outsourcing platform Ziptask, tells Business News Daily. “The founders don’t want to give up, and are embarrassed to concede defeat. So they keep the dream alive but never really complete what they originally set out to do.”
So, what should you do if you are in this situation? “If you fail, try again, but next time, do it faster,” Livermore explains. In other words, take practical action.
A natural disaster
Of course, if a fire or flooding incident strikes, you won’t want this to disrupt your communications with clients. However, it could if on-site communication infrastructure at your office incurs damage due to the disaster.
Therefore, instrumental to effective disaster recovery planning is making sure you will be able to keep your corporate communication channels open even when you can’t do so from the office. A unified communications (UC) platform would let you route calls to alternative devices.
Not investing in marketing
It’s too easy to assume that, if you are running a genuinely useful business, your target customers will stumble across it at some point without you needing to make much effort to spread the word.
In reality, though, it doesn’t quite work like that — especially if your business is rather living life on the edge financially and so can’t afford to wait for customers to simply discover the company of their own accord. Embark on a marketing strategy before carefully refining it.
A bad business model
“There may be trouble ahead,” Frank Sinatra famously sang — and while, at the time, he probably wasn’t referring to travails of running a business, you do need to be on the lookout for potential signs of danger as your corporate journey unfolds.
Fortunately, if you keep track of how and where your business is getting most of its money, you are already in a better position to steer away from choppy financial waters. So, you can relax and enjoy the moonlight, music, love and romance Ol’ Blue Eyes also sang about.