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The Top 3 Mistakes All Startups Make

Falling in love with your team & your customers’ problems guarantees a successful product-market fit!

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BY Natalie Nixon - 08 Aug 2018

The Top 3 Mistakes All Startups Make

PHOTO CREDIT: Getty Images

Every summer, talented, curious and ambitious young people gather from around the world to simulate in 15 days the launch of a startup and then pitch in front of real investors.The European Innovation Academy (EIA) has hosted these accelerators in Nice, France; Turin, Italy; Lisbon, Portugal; Doha, Qatar; and now Shenzhen, China. As EIA president Alar Kolk advised the participants, "Find shark-bite size problems; not mosquito-bite size problems!" The process is energizing, and full of highs and lows as the students strive to deliver a tech-infused product or service that will create value on a global scale. Rick Rasmussen, Director of Startup Programs at UC Berkeley, describes it as "organized chaos".

In Shenzhen, China at the Asia Pacific Innovation Academy (APIA) where I've served as a Chief Mentor, the participants are running into the same challenges that make or break real startup companies: whether they are pitching an ed-tech platform, a travel concierge infused with artificial intelligence or an app to cure social isolation. Here are the top three mistakes that startups make, and that these students also tried to avoid.

#1- They Don't Form A Symbiotic Team

I use teaming as a verb, because amazing teams don't pop up overnight, it's an active process. Teams are intentionally created and should evolve. Ideally, people are selected based on similar values, personalities and complementary skill sets. Assessment tools such as the Birkman or 16 Personalties tests are helpful. The best teams have thought diversity, creative abrasion and tap into people's strengths. For example, if you are the brainchild behind a concept, that does not mean you should be the CEO. In fact, as Shira Abel, Marketing Strategist at Hunter & Bard notes, you definitely should not be the CEO: "You are most needed in a position where you can continue to create and grow the idea internally."

Your team should behave more like a jazz band, less like an orchestra that requires a lead conductor constantly telling it what to do. Harmony develops because each person knows its role and how best to enliven the strengths of others. Angelo Castagneto, a stress management consultant, advises that it is a very good idea to "start by creating a team covenant. This is a written agreement created by all teammates about how each person will show up, work through problems and deliver to customers. It is very important to post the covenant some place visible and accessible."

Peter Drucker famously said that "culture eats strategy for breakfast". If you agree, then invest first on developing a dynamic team, because people are the root of your company culture. Yuri Mikitchenko of Messente Communications has observed that "often investors will stick with a young company that has a great team but an underdeveloped product just because they see promise in the people and in the team".


#2- They Develop an Idea- Not a Customer's Problem

The primary reason teams began to fall apart at the APIA accelerator was because when it came time to validate their concept, the value proposition did not resonate with potential customers. This is also the case with actual companies. As Federico Massamo of Teaching Entrepreneurship, admonishes, "the teams started with an idea, instead of with a customer's problem. People only care about their problems- not about your newest and flashiest idea." The ideal process is to go from identifying problems people have by getting out of the building, observing every day activities and talking to people. The next step is to frame questions around that problem ("How might we...?"), and then test and validate through simple prototypes (doodles, wire frame sketches and cut-outs, and recorded role play) to confirm whether or not the product, service or experience is a market fit and could be developed at scale. Massamo encouraged the participants to trust that if they had identified a big enough problem, with a solution introduced at the start of the diffusion of innovation curve, then it could be monetized and create value at scale.


#3- They Stop Improvising

Often the path that got the startup to a bombastic and audacious service or product, fizzles away over time. This is because teams become fixated on the gizmo, or the app's functionality, instead of on work process. They forget to be intentionally focused on the environment and work culture they create that will allow them to be creative and think in generative ways. What is needed is an improvisational work culture with fluid structures. Improvisation is not doing whatever you feel like- there are rules! Ask any jazz musician or comedian on Saturday Night Live. In a start up environment, to improvise means that people must be firmly rooted in the present. When they are stuck in the past they have fallen in love with an early stage version of a prototype and cannot move on. When they are too far in the future, they haven't taken the time to validate the product or service with real people and their intended customers. Experiment with working hours, the space and environment used and introducing play and pauses into the work day.


Pay attention to these three tips on a continuous basis and reap long term rewards for your growing company!


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