I’ve worked in a number of startups, and even started a few of my own, over the last 19 years. Everything from bootstrapped, idea phase to funded with millions and running off the ground. I’ve seen major successes and massive failures with destroyed finances and culture. I love the excitement and fortitude of startups and those who innovate. But in today’s world, where startups have been commoditized and stories of underdogs making their first million permeate through the ears of young culture, unfortunately many new — and even experienced — innovators have fallen victim to false perceptions on how to make their startup succeed.

Well, here’s a few tips on what not to do.

Scale Too Early

I’ve never heard a startup say: “We went out of business because we had too many customers and couldn’t keep up with demand.” At least, I’ve never heard a startup who wanted to grow and succeed say that. And if this is a real problem, you need to seriously consider changing your pricing structure. But for the vast majority of startups, getting customers is precisely the problem.

Over-optimizing, scaling a system that’s capable of handling millions of users! before you even have your first customer is a bad sign. Back it up. Take a look at the big picture again and consider how much time you could dedicate to finding your early adopters if you spent less time optimizing. If you’re expected to have your website aired on The Ellen Show, by all means, optimize away. But be real. What are the chances of that happening on day one? By the time you get on The Ellen Show, you will likely have the resources to throw at optimization. Build fast and leave the extra work for another day.

Build Too Broad of a Product

You want to build somewhat of a mix between Google, Facebook, Twitter, LinkedIn, and Foursquare for cat babysitters. Just no. Don’t do it. Know your product. Know what you’re really trying to accomplish. And just stick to that. Tacking on additional features and unnecessary shit to make your product achieve viral! growth will distract from your core product and will only confuse your customers. I’m not telling you to stay away from Facebook Login, but don’t make your app “social” or use “gamification” or create a “digital currency” just because they’re the new buzzwords of the day.

Likewise, don’t build a product that needs to appeal to everyone. Trying to build something to cater to the masses will get you a mediocre product. Instead, build a great product for a small group of people or companies. When you’re starting out, your first customers need to be enthusiastic about using your product. So give them something special no big player can give them. You are a startup. Use it to your advantage.

Focus on the Competition

Fixating on the competition will inevitably turn your company into a follower, not a leader. This often creeps up on us, and we’re not even aware we’re doing it. When you’re trying to get launched in a specific industry, it’s natural to keep up with current events in the industry staking out any potential competition. But don’t psych yourself out. Being overly fixated may cause you to make a detrimental pivot to differentiate yourself from the competition, or even worse, cause you to copy exactly what your competition is doing because you see them as wiser than you.

Business is not always a zero-sum game, where there can only be one winner. A clothing store that is selling cat shirts in Los Angeles in-store and online at an alarming rate will have very little, if any, effect on your ability to sell cat shirts in New York. Exclusivity is a fallacy in the startup world. “If one person is doing it, then I can’t do it!” Not true. Competition is actually encouraged in capitalistic societies to prevent unfair monopolies. Once you can justify your company’s existence to yourself and focus on what makes your product better, you may actually find that people prefer your product. Imagine that!

“The Big Launch”

Time and time again I hear of new companies planning to launch their products on a certain date, hiding their sacred plans in the meantime Steve Jobs style. But this strategy worked for Jobs because Apple was already an established brand and their followers would die of anticipation. But if you’re starting a company cold and don’t already have a cult following, don’t rely on that “big launch” to get you a ton of customers. And if you don’t already have a wild reputation starting other companies in the past, people who hear of the product before launch may be wary of the results.

Be transparent with prospective customers. If you don’t have much of a following, throw up a webpage explaining your product — or even better — pre-release your product to the public or potential customers. People respect when you are open and honest with them. They won’t feel like they need to watch out for your product being a conniving scam. Maybe one day, you will need to be more careful pushing out buggy new products too fast, but until then a gradual rollout will likely serve best. I’ve done this myself with great success.

Hire Too Early

This goes in line with scaling too early, but hiring too early presents some unique challenges. We all know your company is going to do great and you are going to build the best products the world has ever seen. It is very tempting to anticipate the arrival of thousands of new customers instantly, and of course you’re going to want to scale quickly so you will need at least 50–100 full-time marketing experts from the get-go to get on Ellen’s show.

Hiring people before your business has real pressure points will cause you to lose a lot of money and productive time very quickly. Without a tangible problem for them to solve on day one, your new employees will be aimless and detract from your resources and time. But with a lack of direction, new hires don’t generally sit around and do nothing. Worse, they tend to invent a new direction of their own, and it may not be one you want. Reeling the focus back can be a daunting task, and it’s generally one a startup can’t afford. Wait until you have a clear problem. Then, there will be no question about the task at hand.

Focus on Attracting Investors

Finding an investor is like finding a relationship. When we feel good about ourselves, we are more likely to find a good solid relationship. When we’re looking for someone to fix us, we take the shittiest thing we can find. Too many startups want investors to fix them with money. But putting focus on attracting investors instead of building a kick-ass product will distract you from creating exactly the investable business investors want to see.

Investment money should be used as a tool for growth, not the source of it. Investors make sense when you have existing traction and you would like to speed up growth, or if the purchase of a particular product or service is all that’s standing in your way. But in both of these cases, the end goal is to build a successful business. Show that you can build a successful business outside of investors on a small scale, and you will have no problem attracting quality investors on a large scale (if you even need them at all).

No matter where you find yourself in your startup, I hope you find these tips useful. In my many years working in startups, these are universal trends that, in my experience, are counterproductive to actually building a successful startup.

I wish you luck in all your endeavors, and don’t forget to KICK ASS!

(and don’t forget to recommend if you found this useful!)

About the Author

This article was written by Michael C. Brook of Pitchly Inc.

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