Embarking on an entrepreneurial journey is exciting, but turning a great idea into a profitable business can be challenging. Many entrepreneurs face obstacles when trying to monetise their ventures. I think that people feel you need to do one or the other, i.e. have a corporate role or be an entrepreneur.
I built my business as a side hustle, adjacent to my corporate career. I left the role when the business was profitable and self-sustaining. This way, you get to test passions and ideas with minimal risk. If you become an entrepreneur, your business has to monetise otherwise it stays a passion project.
Let's explore four common reasons why this happens among newbie entrepreneurs in particular and how to overcome them.
Mistake #1: Failing to validate market properly
One of the most frequent pitfalls for entrepreneurs is failing to validate their market properly. They may be so in love with their product or service that they neglect to confirm whether there's a genuine demand for it.
Without a clear understanding of their target audience's needs and willingness to pay, entrepreneurs risk creating solutions for problems that don't exist or aren't big enough for them to want to spend money on.
How to fix this? To overcome this, research your market thoroughly before investing time and resources. Engage with potential customers, run surveys, and create minimum viable products (MVPs) to test your assumptions. This ensures you're building something people want and are willing to pay for.
Mistake #2: Undervaluing offered product or service
Setting the right price for a product or service is a delicate balance. Price too high, and you may deter potential customers; price too low, and you might struggle to cover costs or be perceived as low quality. Many entrepreneurs undervalue their offerings due to a lack of confidence or fear of rejection.
How to fix this? Research your competitors and understand the value you offer. Consider factors like production costs, overhead, and desired profit margins. Don't be afraid to adjust your pricing as you gather more experience and feedback from the market.
Mistake #3: Practicing ineffective marketing, sales strategies
Even with a great product and appropriate pricing, poor marketing and sales strategies can hinder monetisation. Many entrepreneurs excel in product development but struggle with promoting their offerings effectively.
How to fix this? Learn more about digital marketing, content creation, and sales techniques. Identify the most effective channels to reach your target audience and craft compelling messages that highlight the value of your product or service. Remember, marketing is an ongoing process, not a one-time effort.
Mistake #4: Overlooking how your product, service can be scaled
Some entrepreneurs create business models that are difficult to scale. They may rely too heavily on their personal involvement or fail to implement systems and processes that allow for growth. This can lead to a ceiling on revenue potential and burnout for the entrepreneur.
How to fix this? From the outset, design your business with scalability in mind. Implement automation where possible, create standard operating procedures, and consider how you can leverage technology to increase efficiency and reach a broader audience.
• Imposter Syndrome: Feeling like a fraud can lead to undercharging, avoiding self-promotion, or hesitating to pursue new opportunities. Overcome this by acknowledging your achievements and seeking feedback from satisfied customers or mentors.
• Fear of failure: The possibility of failure can paralyse entrepreneurs, preventing them from taking necessary risks or making bold moves to grow their business. Reframe failure as a learning opportunity and focus on taking small, calculated risks to build confidence.
• Lack of clarity on their 'why': Without a clear understanding of their deeper motivations, entrepreneurs may struggle to stay committed when faced with challenges. Take time to reflect on your core values and long-term vision. A strong 'why' can provide the resilience needed to push through challenging times.
• Scarcity mindset: Believing there's not enough success or money to go around can lead to poor decision-making and missed opportunities. Cultivate an abundance mind-set by focusing on creating value first. Service over sales.
Bottom line?
Overcoming these mind-set barriers often requires self-reflection, personal development work, and sometimes professional support. Surround yourself with positive influences, seek mentorship, and consider working with a business coach to help shift your perspective and build a success-oriented mindset.
Monetising a business comes with both practical and psychological factors. By addressing these key struggles, entrepreneurs can significantly improve their chances of building and monetising their dream business. Remember, success rarely happens overnight – it's a journey of continuous learning, adaptation, and perseverance.
