The business idea is the easiest part of starting up
Indian startups that published financial results for 2022-23 reported a combined loss of ₹26,000 crore. Usually, 20% of startups fail in the first two years. The second myth is that one can become an overnight success.
The media often sensationalizes such stories, giving the impression that startups can achieve rapid growth and great valuations almost effortlessly. In reality, success involves years of hard work, perseverance and overcoming countless challenges. But exorbitant valuations get more popular attention than value creation.
Another misplaced belief is that one needs a unique idea. While uniqueness can provide a competitive advantage, it’s not a pre-requisite for success. Many successful startups entered established markets by offering superior execution, better user experiences or more efficient solutions.
For example, Slack and Zoom didn’t invent team communication, but they redefined it by focusing on useability and integration. Some seem to think that more funding will assure success. Securing funding is pivotal, but that’s it.
Running out of cash is one of the top reasons startups fail. Mismanagement of funds or a lack of sustainable revenue will lead even well-funded startups to collapse. Edtech firm Byju’s is faltering despite being heavily funded.
Funding should be used strategically to support growth and development. Another myth is that successful entrepreneurs never fail. Failure is common and often considered a valuable learning experience.
Many successes, including Steve Jobs and Elon Musk, have faced setbacks and failures before achieving what they did. An ability to learn from failure and persevere is key. Another piece of misplaced wisdom is the 24/7 work requirement for entrepreneurs.
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