Halloween is a fun holiday, but to be honest – it frightens me. Why? Because it reminds me of all the scary mistakes I’ve seen entrepreneurs (including myself) make. Although we often learn from making mistakes, it’s always beneficial to be forewarned to give you the opportunity to avoid making haunting decisions. A successful business is hard to build but easy to lose. Learning from the financial mistakes below will keep your company in business and allow you to R.I.P. at the end of each day.
Many start-ups often fail because their overhead is too high. And although having the latest and greatest gear or offering the best office perks is a nice touch, you’ve got to be realistic when it comes to your funds. In the first few years of business, it’s important to spend meagerly so you aren’t left having to lay off a valuable employee because your office space costs more than you can afford.
Not Being Prepared:
No matter what industry you’re in, at some point, nearly every start-up has to weather the storm. Whether you’re dealing with legal issues or have lost a high dollar client, an emergency fund will provide the extra padding and reassurance you need when times get rough. Of course, I wouldn’t wish these problems on anyone, but it’s vital to prepare accordingly if any unforeseen circumstances should occur.
No budget, no plan:
The financial future of a start-up depends on decisions being made today. Building a feasible budget will not only provide you with peace of mind, but will also save you from overspending and provide you with the ability to build that emergency fund we discussed above. No matter where you are in your business journey, it’s never too late to start budgeting. Make it a priority by starting now.
Ignoring foreseeable legal debacles:
I get it – trademarking can get expensive… but it’s definitely worth every penny. No matter how safe you think your company may be without trademarking, it’s better to be safe than sorry. Do your research on branding (preferably before your company ever opens it’s doors) and make sure you’re completely protected legally. Don’t wait to learn this lesson when you receive a cease-and-desist order forcing you to rename and rebrand your company. This can cost a great amount of money and cause you much anguish that can easily be avoided.
Seen any other scary business mistakes? Let us know about them by commenting below.