Never give up works like a formula for entrepreneurs and startup culture. I have been observing that majority of the entrepreneurs understating it in wrong way. Let me attempt to explain as it is a very sensitive topic.
Why did I choose this topic: As the success rate in startups is below 5%, it is becoming a persistent problem for entrepreneurs. The majority of the entrepreneurs are getting confused between two questions when to exit? Quitting is the right decision?. Taking right exit at a good time on the highway is very much important otherwise, it may take hell lot of time to get back on the right path.
I would say never give up your goal, never give up your passion, never give up your aspiration and never give up your burning desire. Passion and desire are permanent As they don’t have any shape. However, your role, idea, venture, and designation will have a shape; these are temporary. Consequently, never give up your passion, don’t bother about anything until you achieve your goal, this is what the real meaning of NEVER GIVE UP.
Never give up when your product doesn’t have demand:
Eventually, after launching your product you need to increase efforts and budget for sales to promote. It takes a good amount of time to penetrate the market. I would suggest making a detailed analysis of sales after six months. If your repetitive customers are less than 20%, it is a red alert to be careful.
Two important reasons:
1.Your product is not up to customer’s expectation:
Customize the product per customer’s expectation and release it again. This cycle has to happen until product meets customer’s expectation.
2.Product is not right fit to the market
The wrong fit to the market is not a good sign. In this case, you may have to rework or change the idea. Don’t hesitate to make a right decision. I am sure the next idea would be more sharp with less investment and less time as you are more experienced now.
When bootstrapping goes beyond capability:
Bootstrapping (funds from your own pocket) funds are so precious as it comes from your earnings. Your venture can survive for a small amount of time unless you were born rich. For numerous reasons, your money gets dried up before getting funds from a venture capitalist. Burn rate will be pretty high for startups as it is being built from the scratch, Expected and Actuals would vary a lot.
Get prepared for two years to burn money. It could be from your pocket or from an investor. If you don’t get money from an investor on time and the investment is beyond your capability. I would suggest taking a look how long you can survive without earning in personal life. If you are careless about this very soon you will get disturbed and lose the focus on everything. It will have a great impact on your startup either.
When ROI don’t start even after a year (small returns):
Business is to earn money, no one can do business without profit for a longer time, it is a fundamental rule. At least after a year returns should start to meet expenses otherwise you are at risk, it could lead you to the wrong direction. Income should be in ascending order compared to spending.
ROI can be calculated with a simple formula.
ROI = (Profit – Investment Amount)/ Investment Amount x 100.
Dear Entrepreneur, passion is yours, the idea is yours, execution is yours, the struggle is yours, of course, fruits are yours :). Consequently, you are the right person to make a decision when to stop. However, when it is required make a timely decision to stop rather than extend, so you can keep yourself safe and move onto the next venture. If you are not in a safe zone, your passion may get buried either.
Skill has an expire date but passion doesn’t.
You may love this article: How to turn startup failure into success
- As I told in my previous articles, this is an attempt to increase the % of success not to scare anyone.
- Those 3 points are generic ones it may vary from the venture, person, and product.
- Don’t take NEVER GIVE UP as wrong notion.
- Right meaning of ‘Never give up’ doesn’t give up your passion.
- Though you fail in one or two ventures, you can still keep your passion alive.
Also See: Startup Humor