There are thousands of new ventures launching on a daily basis in Kenya alone. Entrepreneurs have a big vision for their businesses, but somewhere along the way they lose track and find themselves throwing in the towel. Growth does not just happen. One wrong step will cost you an entire empire. However, we learn through mistakes. Here are four reasons why your startup may fail within its first year.
Let’s face it; we are not all good with accounting. When you launch your startup, you may not have a laid out plan to help the business boom. Most people think that with capital, everything else falls into place. Plan your business by laying down a clear plan for what you intend to do. Account for every single expense that incurs in your enterprise.
2. Reinvesting in your business
When you start making a profit from your business, you will be tempted to splurge all the money you make. In a case where you do not take back some money into the venture, your business will not grow. Set aside a percentage of the income you get and reverse into your business kitty. If there is no more money for you to invest, get an investor.
3. Taking risks
At times plans fail, and you will be required to take more chances for your business. As a good entrepreneur, you must be ready to take risks. If the model you formulated from the beginning is not working, take the bigger bite, and modify your plan.
Many people do not visualize what they want to create at the start of a venture. What is it that you want to create in the long run? Have you set long term goals? The vision should not only be about how much money you intend to earn. Instead, base your idea on the need you want to satisfy. If you do not visualize on the market you intend to cater to, you will end with a product that does not fit any market needs.
The reasons why your startup may fail should not deter you from achieving your dreams. If you are keen enough to work on them, success is merely around the corner.