What do you think is the biggest misconception most entrepreneurs have when they first start out?
The following answers are provided by the Young Entrepreneur Council (YEC), an invite-only nonprofit organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.
1. That Startups Are Glamorous
“With “The Social Network” and reality TV, it seems like a lot of first-time founders I talk with think startups are glamorous. I often get asked “who’s the most famous person you’ve met?” or “what’s the biggest party you’ve gone to?” when in fact running a startup isn’t about meeting people or going to parties. It’s about selling a product or service to a customer. And that’s hard work.”
2. Product Trumps All
“Many entrepreneurs mistakenly believe that if they develop the right product or service, they will succeed. In reality, it is much more important to have the ability to execute and a great team to make it happen. You can have the best product in the world, but if you can’t execute, you will never be able to deliver it, and if you don’t know how to sell or market it, no one will ever hear about it.”
3. You Need VC Funding to Start Up
“VC funding sounds sexy and a lot of entrepreneurs think they can’t launch without it. The reality is, you need to be really good at bootstrapping and growing a company before you should even think about accepting institutional funding. It will make you a better business person — and it will garner more trust from investors. “
4. That People Will Buy Your Stuff
“Most new entrepreneurs I speak to believe people will automatically want to buy their products or services – but that’s not true. You’re gonna have to sell your stuff! This was a rude awakening for me too, when I started my business. How can a startup increase its odds of success? : 1. Find a way to test the demand for your products. 2. Get some (in-person) sales experience under your belt.”
5. I Can Do Everything Myself
“When you’re starting out and getting cash flow in order, it’s scary to think about handing over any part of the work to someone else. But the truth is, you need to be focusing on your strengths to grow the business, and in many cases, you simply won’t be able to manage everything. Consider outsourcing your legal advice and bookkeeping at the very least.”
6. Flash in the Pan or Five-Year Plan?
“I hear from many people who get overly excited by an idea and blindly start moving forward into a business without realizing the long-term implications of their decision. To start a new business is to commit every second of every day for the next five years of your life in order to see the concept through. If you are not comfortable with that timeframe, then you should consider other options. “
7. Confidence Comes Naturally
“From the outside looking in, entrepreneurs appear to have unlimited egos, confidence and assurance in their work. In truth, everyone struggles with confidence from time to time and needs reassurance and support from colleagues, mentors and friends. Outward determination and certainty may be great for image but it doesn’t mean entrepreneurs don’t have doubts or mistakes along the way.”
8. That Your Business Plan Means Anything
“Writing a business plan is fun and can be helpful to work through your idea. That’s where it ends. Your business will change so many times and your financial projections will never be right. Get ready to listen to what the market tells you and adapt. Don’t worry about what paragraph of the business plan it fits into. “
9. That It’s Easy to Raise Outside Financing
“One of the unfortunate byproducts of so many great companies emerging out of the Silicon Valley these past few years is the perception that it’s easy to raise investor money. I assure you that 20-somethings are not prancing around from place to place collecting $1M checks based on their ideas. Raising investor money is extremely hard, and it takes half a year end-to-end. “
10. The 24/7 Workday
“Too many entrepreneurs think that in order to run a startup, you need to live the lifestyle of working 24/7 and have a startup mentality. The best advice I ever received was that you need a few days where you pull long hours and overnighters, but if you set your company up as a company, not a perpetual startup, you will be able to work a normal work day and be more successful in business and life.”