Financing Failures: Why so Many Startups Can’t Survive

Have you ever dreamed of starting your own business? Every year thousands of people fulfill their dream of becoming an entrepreneur only to encounter unforeseen obstacles that cause their venture to fail. In fact, 90% of startups fail within their first year. Learn why it’s so hard to start and sustain a successful business and how you avoid some of the common pitfalls like financing failures.

Product or Service Isn’t Wanted

A survey conducted among failed startup founders said that the lack of market or need for their product, was the main reason for their failed business. Basically they didn’t have a product or service enough people wanted or need. Check for flaws in your demand with these areas.

  • Weak Value Proposition

A value proposition is a statement that says why people should buy your product. For example, people buy Aspirin because they know it will get rid of aches and pains. Your product needs to have a clear value proposition in order for people to know why they should buy your product.

  • Wrong Time

No matter how great your idea is, your business must be relevant to today’s consumers. If your business is ahead or behind the times, it’ll be very hard to gain traction. Are there already a thousand stores just like yours in the neighborhood? Get in at the right time and your business will take off.

Not Enough Money

Money management is critical for any business, but especially in a startup. The key to proper financial management is having the right equipment when you start. In order for your business to function, you need certain essential equipment. Do not decide to invest in the necessary items after you have open up shop. That’s like flying a plane that’s only 95% ready. You should also keep enough cash on hand for day-to-day operations. A business cannot be sustainable if you don’t have enough daily cash. If you know it will take off in time, a loan might be a good way to get on your feet. Talk to investors as well to see what options you might have for outside funding.

Not the Right People

In order to have a successful business, you need to build it with the right people. However, just because someone is skilled at their craft, does not mean they are great management partners. Business is a tough environment and your team needs to be composed of people with key skills, leadership ability, and similar vision. Find people who will work with you to achieve your vision. You should also be willing and able to compensate them. Even if you picked the best, they will easily fall away or desert you if they can’t see the rewards. Use a good system and a Pay Stub Calculator to make sure everyone is compensated accurately.

You team will need to generate good business ideas, test them, and thoroughly carry out your business strategies. If you have a great management team you will probably be able to avoid the other two causes of failed startups.

Plan Now

Before you decide to open your own business, create a well thought out business plan. As Benjamin Franklin said, “If you fail to plan, you plan to fail”. Study why businesses fail and plan how you can overcome these challenges. Once you have a solid plan, get what you need, and start your dream business!

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5 Personal Finance Books to Add to Your Reading List

What have you been reading this summer? Every person reading this post likely has a different answer. Some prefer lightweight reads in the summer months such as young adult fiction or romance novels. Other prefers historical fiction, political satire, or biographies. Maybe sci-fi and fantasy are more your speed. Whatever you have been reading, hopefully you’ve enjoyed it.

Now, let’s talk about a few books you should be reading as your autumn closes out. When it comes to personal finance books, everybody could use a little bit more information, and a little more education. Whether the authors are giving advice on saving money, living on a budget, or investing, books on personal finance are great additions to anybody’s summer reading list.

This is why we have put together this list of 5 books on personal finance that you should read before the weather turns cold.

Women and Money – Suze Orman

Suze Orman has provided insightful financial advice to people for decades. She continues this pattern with “Women and Money”. Suze Orman recognizes that when it comes to money women need both education and empowerment. This book includes a 5 month program that helps women establish financial independence and personal freedom. Many books provide a lot of heady, high level information.

Ms. Orman takes a more practical and relatable approach providing women with specific steps that they can take towards improving their financial situations.

Why didn’t they Teach me this in School: 99 Personal Money Management Principles to Live – Cary Siegal

Cary Siegal wrote this book upon realizing that his children and their peers would graduate from high school and college without any formal, personal finance education. In spite of covering 99 principles, this book is quite easy to read and the lessons are conveniently parsed out.

This book targets young adults, but there is valuable advice here for any age group.

The Success Principles: How to get from where you are to where you want to be – Jack Canfield and Janet Switzer

Do you have plans and life goals that you have yet to achieve? Maybe you would like to start a business or go back to college. Whatever your plans are, it can be easy to feel stuck where you are, and getting to a place where you have achieved your goals can seem impossible.

This book is a goal-oriented book that gives financial advice that relates to conquering your next challenge. The authors include daily action steps, ways to increase your confidence levels, and practical advice on living in the modern age.

Rich Dad Poor Dad – Robert Kiyosaki

Rich Dad Poor Dad is a book about money lessons learned from two different men and the influence those lessons had on the author. The lessons he learned from the rich dad in the novel gave the author the opportunity to retire before the age of 50. In this book, he passes that knowledge on to others.

Many readers will be surprised to find that what they have been taught about money is completely off base.

Total Money Makeover – Dave Ramsey

Dave Ramsey is a well-known author, financial guru, and a nationally syndicated radio talk show host. Ramsey has a very easy to read writing style, and provides a lot of great practical advice to his readers.

The best endorsement of Ramsey’s is advice is simply the success that his readers and listeners have achieved by following his advice. Many are put off by Ramsey’s tendency to be extreme in his rhetoric, and that is a valid criticism. However, if that can be ignored in favor of focusing on just his financial advice, readers can learn a lot.

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