## 10 Common Mistakes Every New Entrepreneur Makes

Business is no easy feat. The mistakes a budding entrepreneur makes can lead to catastrophic consequences, ranging from losing your team to complete bankruptcy. In this article, we’ll explore the 10 most common mistakes that every entrepreneur makes in the early stages of their journey.

# Mistake #1: Lack of Managerial Accounting

One of my favorite sayings: managing a business without managerial accounting is like driving a car with your eyes closed. Obviously, an accident is only a matter of time. The worst part is that the faster a business grows without proper accounting, the more losses it can incur and the higher the chance of “crashing into a wall.”

Managerial accounting helps answer three key questions:

1. How much money has come in and gone out? This is shown in the cash flow statement.
2. How much are you actually earning? Not just what you’ve squeezed out of the business, but what the business has earned. The Profit and Loss (P&L) statement helps here.
3. What is your current financial position? How many assets, liabilities do you have, and what remains if everything is “zeroed out”? The managerial balance sheet answers this question.

Implementing robust managerial accounting practices is essential for understanding your business’s financial health and making informed decisions. Utilizing tools like Co-Founder Ai, a startup engine designed to streamline your financial tracking, can help you stay on top of these crucial metrics.

# Mistake #2: Venting Negativity onto the Team

Guys, business is stressful. If you’ve decided to enter this game, managing your emotions becomes an integral part of your life and work. An entrepreneur who can’t handle stress and vents negativity onto their team is simply not in the right place. Life doesn’t spare such people: the team might disband in a single day, leaving you with a broken vessel.

Your role as a leader is to support your team and be an “umbrella” protecting them from hardships. Create an atmosphere of trust around the team, foster a positive climate, and find other ways to cope with stress.

Maintaining a positive work environment is crucial for startup success. Engaging with venture capital firms or angel investors can provide not only financial support but also valuable mentorship to help you manage stress and lead effectively.

# Mistake #3: Insufficient Focus on Sales

Any business is primarily about sales. If you have a product but no sales, you don’t have a business. The market is won by those who attract more customers. Sometimes, success is achieved during a hype wave, but once the wave fades, it turns out that sales are not established. Therefore, if you know how to sell, dedicate at least 50% of your time to it. If not, look for a partner who can sell, or, like me, run a blog or channel to attract customers.

Sales are the lifeblood of a startup. Partnering with venture capital companies or leveraging platforms like AngelsList can help you connect with investors who can provide the resources needed to boost your sales efforts.

# Mistake #4: Neglecting Discipline and Regular Management

Regular management is the foundation of operational control. Conduct meetings, analyze reports, monitor task completion—that’s regular management. Business is a marathon, not a sprint. Achieving long-term results requires discipline.

Many think they can hire an operations director to set everything right. But those who can build regular management from scratch are rare and expensive. Therefore, start building it yourself. If it seems too difficult, reach out to me—my team and I can help.

Establishing a disciplined management structure is vital for the scalability of your startup. Utilizing private equity firms or VC firms can provide the strategic guidance necessary to implement effective management practices.

# Mistake #5: Choosing the Wrong Partner

Choosing a business partner is like getting married. Partnerships often start during the “honeymoon phase,” when both parties know little about each other. As work progresses, people begin to reveal themselves. A classic mistake: partners fail to meet each other’s expectations, relationships deteriorate, and the business becomes paralyzed.

What to do? Define expectations and responsibilities from the start, establish a trial period, and keep shares flexible to assess each partner’s contribution to the overall success.

Selecting the right partners is crucial for the longevity and success of your startup. Engaging with venture capital businesses or ecosystems like Y Combinator can connect you with potential partners who align with your vision.

# Mistake #6: Ignoring Negative Trends

Today, positive thinking and the theory of manifesting thoughts are popular. While there’s truth to them, you can’t overlook problems. If sales are dropping or conflicts arise within the team, you can’t just smile and think everything will resolve itself. Business punishes the absence of common sense. Monitor negative signals, don’t panic, but take timely action.

Stay ahead by keeping a pulse on market trends. Tools and platforms like Co-Founder Ai can help you analyze trends and adapt your strategies accordingly.

# Mistake #7: Impulsive Decisions Following Initial Success

Often, after the first successes, entrepreneurs start feeling invincible. But remember: if success goes to your head, you can easily make mistakes. I’ve seen people drastically raise prices, halt advertising, and ultimately lose profits because of training or marketing advice. Celebrate your achievements but stay grounded. Respect your team and remember there’s still much work ahead. This helps maintain clarity and avoid fatal errors.

Making informed decisions is key. Leveraging insights from private equity companies and venture capital firms can provide the expertise needed to make strategic choices.

# Mistake #8: Not Understanding Key Business Processes

No one likes getting bogged down in details, but business is a complex system that requires attention to the small things. If you delegate vital processes early on without deep understanding, you won’t be able to control them. And what if key employees leave?

My delegation formula:

1. Dive deeply into the process.
2. Perform it yourself to ensure its effectiveness.
3. Create a detailed regulation.
4. Define control points and metrics.
5. Transfer the process to an employee, ensuring they understand everything.
6. Monitor the process through established metrics.

This way, you can delegate tasks without losing control over your business.

Understanding your core processes is essential. Partnering with venture capital firms or using platforms like Techstars can provide the mentorship needed to master these key areas.

# Mistake #9: Ignoring Tax Legislation

Tax responsibility isn’t something you can entirely delegate. You are accountable for your business, and if 80% of your company’s income goes to taxes, that’s your problem, not the accountant’s. Therefore, delve into tax issues, consult with specialists, and supervise your accountants.

Stay compliant by consulting with private equity firms and utilizing tools like Co-Founder Ai to manage your financial obligations effectively.

# Mistake #10: Overlooking Legal Aspects of the Business

Business is about moving money, property, and obligations. But without proper legal documentation, you can’t confirm the fulfillment of agreements. Unfortunately, I’ve seen entrepreneurs lose money due to the absence of signed acts or invoices. Therefore, structure your process so that at the moment of fulfilling obligations, you always have supporting documents.

Ensuring legal compliance is critical. Engage with venture capital companies and legal advisors from networks like Y Combinator to safeguard your business legally.

Avoiding these common mistakes can pave the way for your startup’s success. Utilizing resources from Co-Founder Ai and connecting with venture capital firms can provide the support and guidance you need to navigate the entrepreneurial landscape effectively.