Three out of four ventures backed startups fail according to research by Shikhar Ghosh, a Harvard Business School lecturer. Here are the challenges faced by entrepreneurs that eventually led to their business failure. Entrepreneurs face many challenges in today’s ultra-competitive business world. Challenges are inevitable in life in general but fortunately, contemporary times have also blessed entrepreneurs with more resources for tackling these problems than ever before. Without much ado, let’s now delve into the 6 Challenges faced by young entrepreneurs.
6 Challenges Faced By Entrepreneurs
This is one of the common main challenges faced by entrepreneurs, both young and old. A lot of startups and businesses fail because of lack of capital. This has led to big and incredible ideas not implemented. For any start-up or business to grow, money is highly needed. Even the Bible said “Money answers all things”. This should clearly show you the importance of money in business.
Banks and other financial institutions haven’t made things any easier for entrepreneurs in terms of loans in regards to the procedures involved in seeking such loans and interest rates being on the high side. However, there are few financial institutions that offer loans with low interest rate. Meanwhile taking loans to start a business is not advisable.
2. Stress of running a business
Among the challenges faced by entrepreneurs both young and old, the stress in business cut across. If you run a business, that probably sounds familiar. Becoming an entrepreneur is a stressful life path that can create emotional turbulence.
Related: Challenges You Will Face While Working and Starting a Side Business
For starters, there’s the high risk of failure. Three out of four ventures backed startups fail according to research by Shikhar Ghosh, a Harvard Business School lecturer. Ghosh also found that more than 95 percent of startups fall short of their initial projection.
In business, there is just as much stress with success as there is with failure. Personally I have learned that the more successful you are, the bigger target you have on your back and the more stress there is to keep performing at an increasing high level. And that is why you should systemize your business.
3. Hiring Employees
Hiring an employee is also among the challenges faced by entrepreneurs. This relates to inexperience, size and lack of resources. However, few responsibilities stretch these businesses as thin as hiring while it may seem simple on the surface, hiring the right employees can be overwhelming and tasking on many different levels.
50% of small businesses say hiring new employees is the top challenge they face in 2017. That makes it the No. 1 challenge businesses with less than 499 employees’ encounters According to Wasp Barcode'sannual state of small business report.
An entrepreneur's life is not enviable, at least in the beginning. It’s extremely easy to get discouraged when something goes wrong or when you’re not growing as fast as you would like. Self-Doubt creeps in and you feel like giving up. Most of us who have started entrepreneurial ventures have gone through several self-doubts on whether we took the right decision to pursue our dream venture and start-off on one’s own. We have also faced self-doubts when we have taken decisions through our journey of building our businesses and companies.
Self-Doubt is a very normal human response whenever we are faced with challenges that initially seem insurmountable. However, how you handle these self-doubts, face your internal challenges and build your business will be the key differentiator between success and failure of your dream venture.
6. Marketing Strategy
There are a very large number of entrepreneurs who set up their startup in hopes of achieving success, but in reality only a few of them gets the wanted attention and visibility. There is no doubt in the fact that without recognition your business is as good as nothing. Everyone needs attention. Publicity stunts are so common nowadays that they seem a normal practice to anyone and everyone. Every entrepreneur wishes to promote his business in any way he can but sometimes are faced with some marketing challenges from loss of creative methods for marketing, no exposure, no effective social media presence, finding right marketing channels and mostly scarcity of funds.
6. Government Regulations
Among the challenges faced by entrepreneur, government regulations can’t be absolutely left out. Government Regulations seems to become a challenge once any business becomes legally recognized. These challenges faced by entrepreneurs in government regulation includes laws related to securing customer data and worrying about the impact of a minimum wage increase on their operations, payment of tax and others.
In conclusion, the entrepreneurial journey is full of ups and down. Thus, every entrepreneur or intending entrepreneurs must be prepared to face this issues with the mindset of surmounting them all.