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How to fail in business without really trying


Back in the brick-and-mortar days all any upstart needed to launch a new venture was a bank loan and a bit of gumption. And while the rules of commerce and capital have remained fundamentally the same, there have been seismic shifts in the technological and marketing landscape. That means businesses have to be more forward thinking than ever if they hope to succeed. Here are the hard numbers from the Small Business Administration:

• New businesses have a 40% chance of survival over five years
• Only 39% of businesses are profitable over their lifetime
• 60% of small businesses either break even or lose money

Reasonable folks can disagree on why so many modern businesses fail, but there’s one thing everyone can agree on—they didn’t plan on shuttering their windows, locking their doors, and letting that website domain expire. Failure surely came as a shock, and many former start-up owners are probably still shaking their heads. Here are three things you should avoid if you don’t want to meet the same fate.

Expecting overnight success

This is a tried and true way to fail at business in the 2000s. Nowadays most first-time entrepreneurs fit into the “Millennial” category, an age demographic known for wanting it all—gratification, status, wealth—and wanting it immediately. But the daily grind is as much a cornerstone of success today as it was over a century ago. Those who keep their feet on the ground, land financing—such as with GoRapid.com.au—and put in the 12, 14 and 16-hour days will be more likely to cash in than those who kick back and dream of the $200 million valuation their friend-of-a-friend’s virtual pet-grooming company landed after being conceived on a drunken night out.

Not doing your (modern) due diligence

Some of the most influential business titans in history wouldn’t have their name in the history books without taking risks. But that doesn’t mean you need to dive into the deep end of an empty swimming pool. Any entrepreneur worth his or her salt will sing the praises of due diligence; indeed, it’s been fundamental key to success since the early days of commerce. But we’re in the social media age now, so homework involves more than market research. Today’s startups need to first check that their catchy domain name is free and available for registration. Ditto that the same name needs to be free on every major social-media platform under the sun. The Trademark Electronic Search System and IP Australia are good tools for trademark searches.

Not building strong leadership skills

This is another skill-set that doesn’t come automatically with the registration of a domain name. It’s vital to hone natural instincts of leadership until everyone knows exactly who’s in charge of the organization. That means being effective at building consensus, mediating conflict, listening to others and marshaling all internal forces to come together for a common goal. Having a clear plan of attack and boundless capacity for communication never hurt, either. What’s sure to sink any startup is a so-called leader who ignores problems, fails to find solutions, and isn’t willing to get his or her hand dirty for the good of the team.

There are almost as many savvy business strategies out there as there are start in the night sky. But those who adhere to the fundamentals listed above will be well on their start to becoming more than another failure statistics, and realizing their dream of runaway success in this new millennium.