Common Startup Misconceptions and How to Avoid Them

CLEVELAND, April 7, 2008 /PRNewswire/ -- Most entrepreneurs have heard the myth that 90 percent of businesses close within their first year. While the reality may not be that stark -- the U.S. Small Business Administration published a study in 2003 that stated that 66 percent of new employers last two years or more and 50 percent survive four years or more -- entrepreneurs still face some common startup misconceptions in the initial stages of building their businesses. Here are just a few misconceptions that entrepreneurs often have, along with some suggestions for dealing with them.

1. My product/service alone will make my company successful. Entrepreneurs need to be aware of this misconception and remember that hard work and good people, along with a solid product, are what make a company successful.
   
   
2. My product will sell itself. You might be able to build the best widget on the block, but can you sell it? No matter what your background might be, you should realize that everyone in the organization will need to wear a sales hat at some point. Many entrepreneurs could benefit from attending a business course at a community college or adult education center where they can further develop their sales and marketing skills.
   
   
3. I don't need to network right away. Making connections is extremely important in all phases of business. You never know when you'll come across someone who can help and there are many tools that exist to help you in your networking efforts. For example, IdeaCrossing is a free online resource that connects entrepreneurs with investors and business mentors. Check out some of IdeaCrossing's tips on business networking.
   
   
4. If I sell my product cheaper than everyone else, that should be enough. Many entrepreneurs forget that business is about making a profit, not necessarily about selling more than your competitor. It is more important to differentiate your company and product offerings than to simply say that they're cheaper than anyone else's.
   
   
5. Selling to a customer once is enough. A key to growing a business is ensuring that your previous customers keep coming back. Doing so means building strong, continuous relationships with your customers and creating a baseline from which to work.
   
   
6. I'm just a small business, I don't need to keep close track of my numbers. Measurement is extremely important, even for a small business. Succumbing to this misconception will make it much harder to start measuring your results later. As you look to grow your business and seek investors, those numbers will become increasingly important to prove the value of your business for their investment.

Of course there are many more misconceptions that entrepreneurs might have, but watching out for these is a good first step. Luckily, resources and communities like IdeaCrossing are out there to help with other problems that entrepreneurs may encounter. Tools such as the discussion forum give entrepreneurs the opportunity to discuss their problems and come up with effective solutions for the good of their businesses.

About IdeaCrossing

IdeaCrossing is a free Internet resource available to all individuals and organizations with an interest in supporting and promoting entrepreneurial activity. IdeaCrossing helps entrepreneurs find the assistance and investment capital they need to launch promising new business ventures. Additionally, IdeaCrossing serves the Angel and Venture Capital communities by identifying and screening new investment opportunities. Simply stated, IdeaCrossing is about creating the connections that build businesses.

Links:

https://www.ideacrossing.org/

https://www.ideacrossing.org/RegisterEntrepreneur/index.aspx

https://www.ideacrossing.org/RegisterInvestor/index.aspx

https://www.ideacrossing.org/News/Resource_NewsItem.aspx?id=846

https://www.ideacrossing.org/StdForumPage.aspx