5 big mistakes startup founders are making each day
Dr. Karmesh Ghosh
Operations Manager @ Google Operations Center | ISB Future Fit leadership
Mistake #3 is frustrating
My heroes are the ones who survived to do it wrong, who made mistakes but recovered from them. — Bono
Just because you aren’t hungry, doesn’t mean you won’t feed your kid.
You and your business are separate, you got to feed your business, for it to survive.
If you are a small business owner or running a tech startup, most likely you are an introverted techie who has great hard skills from your engineering college but probably suffering when it comes to selling and marketing.
In my 5 years of consulting and mentoring startup founders, some repetitive questions I have received are:
- I don’t know how to attract new clients
- How do I keep my revenue and income steady
- How to overcome competition
- Nobody wants to pay; my customers are stingy
I don’t think there is a dearth of clients or leads, I see there is a lack of hunger and systems with founders.
# Hunger for learning new things, investing in self-development, and hunger to always do more.
# Systems refer to steps that become muscle memory for you.
You don’t have to innovate or think when it comes to systems — they are meant to be like a recipe — just follow it sincerely to end up with a nice dish.
Now, the major mistakes
# 1 Not having a funnel
Please don’t get bogged down and overwhelmed with the word “funnel” “sales funnels” and all other funnels you hear on the web.
A funnel simply means a ladder of services.
Your job is to take your customers from the ground floor to the topmost floor. Don’t leave them in the middle of the staircase!
Most founders behave like a South India restaurant waiter — they rattle out the menu and wait for an order.
They will give you exactly what you ordered, nothing more or less.
Be like a 5-star waiter, making them comfortable, asking questions, suggesting them the best wine and entrees they have to offer. Ask them if they would try the new desert, ask them how the food was and at the end collect a nice fat tip.
Imagine a 3 step ladder.
# 1 Your $0 or free offering 2. your middle offering and 3. your high-end offering
For most tech services startups, have 5 hard-hitting blogs or videos that describe common problems and how you solved them.
You can have testimonials or case studies. It doesn’t cost anything but improves your trust score.
# Your mid-end offering should be your core offering which generates the maximum amount of revenue.
If you are a digital marketing agency, it could be your SEO, SEM or FB ads services.
“Productize” your services so that the customer finds it easy to make a choice. And easier it becomes to open up their wallets.
Customers love choosing a product because they can visualize using the product. Services scare them because it’s a promise, that can go either ways.
# You may have 3 flavors in the middle of the funnel based on the nature of your business.
# Finally the most expensive offering in your funnel, it could be a consulting session talking to you or your expert team member.
It could be a Done-For-You Service where everything is custom.
The customer will be happy to pay if they perceive you as an expert who can save them hours or years with your advice.
#2. Not being invested in your customer’s success
When I was building my website, the agency wasn’t interested in knowing what my overall business is and what my vision is.
They were happy to pick up a small fee for website designing when in fact I had a bigger budget in mind for additional services.
It’s so easy to lose money on the table.
And entrepreneurs are making this mistake every single day — they are happily eating the crumbs when the entire cake is in front of them.
The solution is simple — just “Ask”
- What’s your business?
- Why does this service matter to you?
- You must go for these additional services,we can do it for you or we can get it done by our partner.
It takes a 5-minute conversation from being just-another-vendor to a business-transformation expert.
Don’t stop and be satisfied by offering one product, one solution, pitch the whole deck with relevance.
Related post on Increasing customer revenues here
#3. Not asking for a referral
Only if most small tech firms and startups asked their existing customers for a referral, I’m sure many wouldn’t have had to shut down.
Closing a deal and delivering the service is an abrupt end to what can be a long fruitful relationship. Don’t stop at just closing the deal, its the middle of the staircase.
A referral is a by-product of exceptional service delivered.
It’s easy for your customers to open up when they are happy — it's an exchange.
They are telling you “thank you “for making their lives better by sending more business your way.
Again, the solution is simple. Just Ask. .
Incentivize them or shower them with affection if they send you more business
It could be a 10 percent discount or a great thank you note on their LinkedIn / Instagram profile.
#4 Selling to broke people
We teach the world how to treat us.
If you position ourselves as low cost and cheap providers selling only on price, your customer would treat you the same way.
Don’t complain that there isn’t money in the market. There is no hunger for creativity in you, most likely.
You are selling exactly what your competitor is selling.
So when your competitor goes to the grave, guess where you are going.
You can stand apart with your language, tone, and body language.
# Do an audit of how your website content, your social media posts, videos, and other marketing strategies sound.
Does it sound timid and begging for business or they sound full of expertise and authority?
You don’t need to invest anything to look like a big guy — you need to change your desperate mindset of poverty to that of abundance.
When you change your language, you attract customers of similar frequency.
Why are you hanging out with people who can’t afford you, be seen with people who can spend?
#5 Not marketing enough
Which one is a better scenario — wrapping up your business or learning a new skill?
Most entrepreneurs would rather shut down shop than teaching themselves marketing and sales.
Lots of founders would rather save money and waste time by trying out DIY marketing methods when it can be easily outsourced.
Please note if you love flaunting your CEO / founder/ co-founder title on LinkedIn, it makes you the chief sales guy as well.
Building visibility, authority, attracting attention, negotiating and closing is your core job.
If you are smart you could learn it, hire a team or outsource it to a consultant.
People like to do business with firms that evoke trust and trust has to be built daily. Trust is not an event.
Starting from engaging your existing customers, telling stories of success, educating your new customers should be part of your daily marketing hygiene.
Be it WhatsApp, or Facebook or whatever social media suits you, be visible each day, one post at a time.
Bonus strategy #6
If you are in the product business, please read this piece on Medium.com — I Loved it. Here it is.
Now that we are in the middle of a recession, no one is going to come to your rescue. Trust me on that.
It’s you and you by yourself.
The sure-shot way of survival is by doing 2 simple things.
# 1 we discussed was just Asking and
#2 is overserve
Overserving your customer and marketplace is a karmic investment that will come back to you with dividends.
Karma works!
No business has ever been closed because of great customer service, great product offering, and great listening skills.
Please don’t give me Kodak, Nokia, and Blackberry examples.
They over-served but forgot that they were overserving the wrong product.
When you have the hunger of doing more and asking more of yourself, you will deliver more as well.
In closing,
It doesn’t require fancy management degrees or hiring consultants to turn around your company.
The checklist to follow is:
- Build a funnel
- Be invested in your customer
- Ask for referrals
- Stop broke customers into your life and
- Always be marketing
It’s easy to make fewer mistakes than doing many things right.