Many startups have a rocky road to success, complete with obstacles, challenges, and unexpected disruptions. For most business founders, this is a badge of honor of having “paid dues” in the business world.
Of course, that doesn’t mean there aren’t mistakes that can be avoided. If you can anticipate mistakes and prevent them, you can have a smoother and less stressful trip to the top. Here are 10 things I wish I knew before launching an engineering startup.
1. The Business Comes First
Some startup founders get into the business to pursue a passion, whether that’s catering events, designing clothing, or PCB design. In reality, that’s only going to account for a small amount of your time.
Most of your time will go to developing business strategies, implementing marketing campaigns, engaging with customers, and handling all your administrative tasks. When you launch your own startup, you have many hats that you wear before you get to be the caterer, designer, or retailer.
If you enter into your startup with this mindset, you’ll be better prepared to launch and sustain a successful business.
2. Customers are the Top Priority
Businesses are about making profits, but that’s not the primary goal. If you’re only in it for the money, you’re unlikely to get very far. Successful businesses become that way because they create a product or service that can solve a problem for the customer. The best product in the world will fail if no one needs it.
When you plan your startup, consider whether your product provides value to customers. If you have competition on the market, does your product or service elevate the solution? Or is the current product offering sufficient?
For example, plenty of 2-layer circuit boards are on the market, but not all of them have the quality and features for performance. A 2-layer circuit board with superior heat resistance and conductivity is a standout in a crowded market. Focus on delivering a superior product or service that addresses the customers’ pain points first, then worry about the profits later.
3. The Odds are Against You
The unfortunate reality is that most startups fail. While that doesn’t mean your startup will fail, it means that the odds are stacked against you. If you’re not prepared for that and put “all your eggs in one basket,” you can end up in worse shape if the startup struggles or goes under.
Though it may be difficult, keep your current job while you’re building and launching your startup. Take the time to build up your emergency stash and conduct thorough market research. When you’re ready to launch, you know you have a safety net to fall back on.
On the upside, if you do fail, you will have learned valuable lessons that you can apply to your next position or startup idea.
4. You Must Be Self-Sufficient
Most people’s careers are filled with bosses, coworkers, and a sense of community. When you work at an established business, big or small, you have other people to help and keep you focused on the task at hand.
With a startup, it’s all on you. Every decision and responsibility fall on your shoulders, even if you have a small team, and that can be difficult. If you have a business partner, that can make it a little easier, but you could still end up shouldering a lot of the burden on your own.
5. Cash Flow Management is Crucial
Cash flow is one of the most important aspects of your business, no matter the industry. If you don’t manage your cash flow effectively, you could spend more money than you’re making. This could result in significant debt, or worse, leave you with less money than you need to keep going.
No matter how quickly your business grows, keep tight reins on your cash flow with a budget. Make sure that every expense is necessary to your business and build an emergency fund. If things slow down or unexpected expenses come up, you’ll be prepared.
6. Part-Time Work Offers Stability
With a startup, it’s best to keep your full-time position as long as you can. If your business grows so quickly that you no longer have time for that, don’t get ahead of yourself and quit. Try to maintain a part-time position for stability and peace of mind.
Successful businesses don’t happen overnight. It takes time and patience to build a startup with long-term viability. During that time, you may encounter slow periods or times when the expenses outweigh the revenue, and the last thing you want to worry about is where your bill money is coming from. Keep your part-time work, side gig, or freelance position for evenings, weekends, or other free time to alleviate the financial stress.
7. Engagement Matters
No matter how good your product or service is, customers don’t want to purchase from faceless organizations. When you engage with your audience, you have an excellent opportunity to humanize your brand and show your customers that you’re in it for them, not for yourself.
Engagement is so important, but many startup founders lose sight of this as they focus on administrative tasks, marketing, or product development. A little upfront work will pay off in the future, so take the time to respond to comments on social media, blog posts, emails, or review sites.
In addition to building relationships, you may gain insights into what your customers are looking for from you and what you’re doing well, so you can improve your marketing and product development in the future.
8. Outsource as Much as Possible
A lot of startup owners try to do everything on their own, which leads to burnout and missed tasks. Your skills lie in one area, so you may not be up to the task of designing a website or logo, handling the accounting and payroll, or managing the content and marketing.
You don’t have to do it all, though. Plenty of tasks can be outsourced and automated through technology tools or freelance sites. You can hire accountants, writers, web designers, marketing consultants, and graphic designers from freelance sites. You can also outsource or automate administrative tasks, such as payroll and human resources, social media marketing, and more.
9. Pay Attention to Competitors
Your competitors play a big part in your positioning and future success. The audience, pricing, features, website, customer service, and marketing of your competitors all have an indirect influence on your business, so you have to pay attention.
If possible, visit your competitors in person or online and see what they’re doing well and not so well. Check out social media activity to see if their customers are happy, or if they’re complaining about different aspects of the products and service. Read articles about them. The more you can learn about your competition, the better you can structure your business to get ahead.
10. Enjoy the Ride
Launching a startup can be incredibly time-consuming and stressful, so don’t forget to have some fun in the process. Even if you’re bogged down with tasks, set aside some time for yourself to enjoy dinner and drinks with friends, spend time outdoors, or take part in a hobby. It can’t be all business, all the time.
Even if you keep all of this advice in mind, you may still make mistakes and encounter obstacles along the way. All startup founders have challenges to overcome and learn through trial and error. How you handle these sudden disruptions and obstacles can make all the difference in your success, however.