Top 10 startup mistakes that should be avoided

8 min read

“An idea is worth a gold dime, a perfect begging for a new business to run its wheels into the market space.” – a quote that perhaps visited every startup mind from their beginning. Most of their ideas are truly awesome and take some very unique approaches, although not all of them can survive the startup mistakes they will encounter.

Aside from the obvious challenges and milestones on the path, most of the entrepreneurs make some of the biggest startup mistakes or might have a real struggle to start operating their business, since they have little to no expertise. They might have great standards, awesome workers, potential prototypes, but all of that does not make up for the lack of experience and understanding of business logic. So, they also meet the same fate as any common startup does: closed down, before even opening up.

According to BLS, it was estimated that more than 20% of all small businesses who are initiating their work for future products are already failing in their first year. So how exactly do you ensure the integrity of your business goals and surpass the startup mistakes on your way? Especially for you, JetRuby has reached out to its partners as well as referred to the well-known public examples, to prepare this article. As a result, we present to you a list of the 10 biggest and most expensive startup mistakes that every entrepreneur should avoid.

No value to the targeted market

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Building a product for a specific group of people, which pain points will be solved is the correct approach for any startup to initiate their work. Since by correctly identifying the hidden potential in their future product early on, one shall avoid the failure of the product’s lost market purpose.

One of the great examples of mismatched market needs is the story of the “Patient Communicator” startup group. The owner initially targeted a digital product that will organize and structure the office work for medical doctors. However, he never really assessed the market needs or interviewed any doctors and only referred to the opinion of a close relative, who worked in the hospital industry for a long time. In the end, as the digital product was deployed, the company owner understood that no one really wanted it. Since the main concern and focus of doctors are their patients, not the complexity of their office work.

All in all, it is really significant for every startup to correctly analyze and understand which market niche his product is accustomed to, in the first place. Since, even for a JetRuby case with a new client, our professionals will estimate that the person in charge of his idea will know better all know-hows, including product marketing aspects. Therefore, by having enough knowledge and expertise in your field, or by doing preliminary research, you can gain new customers and solve their pain points consistently. There are many ways to avoid such brutal and expensive startup mistakes, the Design and Discovery phase is just one of them which already proved its value for many of our clients.

I walk a lonely road

Sharing is caring, especially when you properly divide your work among your partners or friends to gain a more successful and dynamic start of your business. So don’t try to weigh down everything on your shoulders, work on your project with the people you trust the most.

“It is essential to find a trustworthy partner to discuss your business ideas, challenges and goals. Coincidentally for us, it was JetRuby that listened to our requests, internalized them and compared them to other projects to produce value.” – Jack Green, CTO of NameCoach

A single startup company unit may not have a large number of tasks to run. But it doesn’t really mean that a single person can actually handle all of that. Just imagine that you have to properly structure down a marketing plan, find the right investment partners, nail down your project plan, and lots of other important details that one person cannot physically take all on by himself. Otherwise, you’ll make tons of different startup mistakes with no clear solution for even one of them.

Yes, there are examples where a startup began from a single person, like the owner of Oracle, Larry Ellison. However, once he opened up his company and started putting his focus more on his product, he delegated his work among his other 2 tech-savvy partners, which resulted in the very first and most successful customer ever – the CIA. So don’t try to push every single task on your shoulders. A little help from here and there didn’t hurt anybody.

Incorrect budget management

When someone mentions any topic that is somehow related to a startup, the very first thing that comes to your mind is the budget limitations. That’s very obvious, since every startup has a limited budget on their hands, granted to or earned by them for one solid reason – make a successful product.

A founder, who received a large amount of money may spend it very irresponsibly for various little and unnecessary needs. Since, he might think that by purchasing all of the expensive goods, his product will be the best one on the market. But, what if after spending all of his received money there is a huge change in the product structure and everything has to start from the beginning? In that case, it would mean the end for everybody in the startup.

By properly managing your budget and building a financial plan, you can’t drown in the guilty pleasure of spending money. You can take an example from our project “OSRAM”, where we have implemented an indoor vertical farming system. Our team summarized the required resources, how much time and scope were estimated for planning and budget while staying transparent and yet simple. It wouldn’t be possible without the right processes which we run through the very preliminary stages, analyzing the user journeys and creating detailed project specifications.

The bottom line – the budget has to consider the potential of quick tweaks of a product right after its launch to make sure it fits the needs of users and satisfies them better than competitors. And of course, the marketing portion of the budget has to be very well planned – many great products made similar startup mistakes, due to a small marketing budget.

Launching / Scaling too quickly

One of the most significant moments that every startup team is impatiently waiting for is to finally release their product and wait for the first client’s feedback! Although for that, one has to be sure that all of the core functionalities are working as they should do, so it can handle new, incoming traffic.

That also applies to the proper scalability of your business. If you plan to upgrade your business to a new level, be sure you know all of the aspects of a new product, a targeted market niche, and the services you provide. Because if you don’t, you are risking an entire enterprise for a fall down.

During one of the projects, our client has actually shared with us his rigorous startup mistakes with the healthcare application that he wanted to implement from the start. However, fortunately for him, he didn’t meet the same fate.

“We had an idea for creating a unique, yet simple solution for both patients and the medical institutions. It was a truly great one and in the beginning we had really good hopes. However, what we failed to overlook is that we didn’t put our software to testing and focused on its constant scaling, which resulted in tremendous halt, till the time we asked JetRuby for proper assistance.” – CTO of Healthcare App

Wrapping up, a launch, or a scaling process is always a big thing, especially when you build your very first startup ever. Thus, understanding all of the core business needs and product aspects can be a deciding factor for the existence of a startup group.

Wrong location & Wrong timing

Pretty much everybody knows such an idiom: ”Nothing personal, you just got here in the wrong place at the wrong time”. And that applies to the business terms too! Mistiming or even launching your product in the wrong location may make a young startup fail miserably.

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For example, let’s say you want to build a travel agency with lots of benefits along with a mobile app. You’re very passionate and almost fall over hills for your idea and try to live it out. However, what you don’t notice is that most of the travel agencies in your area have much more beneficial opportunities and their numbers are gigantic. As much as you will try to successfully push on your services, the main user traffic will still go to your Big Brother competitor.

Based on this scenario, what our digital agency would suggest is to investigate a local area where the competency of travel services is relatively medium and try to analyze their main product strength and weak points. Once you get that, you should prioritize your actions and functionalities to understand what exactly you should do to achieve a Minimal Viable Product.

Overall, the key takeaway of this startup mistake is to know where and when should you launch your solution. It will not only produce the benefit of the correct marketing plan but also will correctly align your product development path according to the analyzed conclusion.

Hiring too quickly

One of the most interesting and yet deadly startup mistakes is starting the hiring process for a project almost immediately after initial formation is done. Sometimes, it is noticeable in hiring full-time staff or employees instead of part-timers or even contractors that may do the same amount of work, while still reducing the amount of spent time and expenses.

Another side of this flaw is that most of the young entrepreneurs are just trying to get the right amount of people, not the right people that will fit the project scope. Perhaps a friend of yours didn’t have enough expertise in the field of your job or maybe an employee had a high temper and just didn’t fit inside the team properly.

So, be sure you feel exactly what kind of people are working within your startup and understand what kind of tasks your startup team is executing. According to that, you can already estimate whether you really need a full-time or perhaps a contract can easily handle the given task.

All of that should be thoroughly considered in the development process. By implementing proper project planning, you can launch your idea in time and prevent any unnecessary dev team scaling, according to the initial requirements, produced in the Design and Discovery phase.

Poor marketing

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Essentially, product marketing is like a beating heart for your business: you breathe in the leads coming through the blood flow; you breathe out and the project avenue is basically in your hands. Most of the startups don’t really focus on the marketing stage or they don’t really see the point of promoting the product.

However, executing a proper marketing strategy, advertisement plan, and pushing your product to the desired audience is considered to be one of the most important traits of a successful business. The reason why startups don’t put too much emphasis on the marketing aspect is that the technical founders are only interested in coding and building the product to its perfection.

To prove it, we have analyzed our clients who were mostly involved in tech development products before they came to us, to understand what they share in common. As a result, we found out that they were solely dedicating themselves to building and creating digital products, discarding the marketing process. They believed creating a product comes first, while customers can wait. Instead, one should balance between implementing a digital product and listening to the client’s feedback. When they approached us, we were able to point out this concern, while they understood their issue and asked us for proper assistance

Absence of a concrete business model

Probably one of the less recognized startup mistakes every entrepreneur has encountered, but still common nonetheless, is the correct comprehension of building a straightforward business model. Typically this issue exists, where one dedicates himself only to one, singular channel of work while risking a loss of a business.

Young entrepreneurs get too optimistic about the way they will be able to acquire new customers since they will build an eye-catchy digital product of their own. It may happen with the first few ones, however, after that, it becomes a desperate nightmare of huge costs for attracting the right audience to buy what you have built.

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One of JetRuby partners already had a similar story, before they came to us. As they were just a tech startup group, they started to implement their digital product and chose to provide it to pretty much everyone: from SMB to big enterprise companies. However, later on, when they decided to go through the Design and Discovery Phase, they immediately understood that it would be in their best interest to only focus on corporate and enterprise companies, which suited their business logic the best.

The potential to bring in revenue from your product is the most important indicator for any startup. And that comes directly from properly setting up your business model. Without it, not only you won’t understand how to properly charge your customers, but also how to interest potential investors.

Hard Competition

“Investigate and analyze your competitors, they will bring you prosperity.”

It might sound very strange for any entrepreneur to grasp it, however, this sentence truly does make sense. Having enough competitors in the area of your product deployment will give you a solid point where you can easily launch it for experienced customers.

On the other hand, by having large competitors you won’t stand a chance to put your product on the line (as their shares are close to 90% of all the market). While in an area with close to no competitors, you might want to analyze whether the solution that you are trying to achieve is a widespread one, to successfully harvest its results.

And it’s not only that, according to our statistics from the clients that we worked with, it was estimated that almost 70% of all businesses are burned down in their first few months, due to the lack of competitors’ knowledge. That’s why we strongly believe that discussing and debating all of the product possible development branches is essential when it comes to web or app project implementation.

All in all, properly identifying all of your potential competitors and product analogs will properly allow you to know how your product can give new value to future customers. Once you’ll get it, it will be no issue to deduce how to advertise your product.

Listening only to yourself

There’s nothing wrong with listening to your inner voice and trying to make things out as you imagine. But you actually have it backward. By ignoring the people who are cooperating with you or even potential customers who are trying to suggest significant information, you are risking your own business.

In an instant, you may have great potential and a prosperous future product. You can almost grasp the sense of success and walk alongside other big companies. However, what you don’t really notice is that by deploying more features onto your product and getting it more unique you don’t get the corresponding feedback from your potential customers or users.

In the end, you produce a product which nobody really needs anymore, since you didn’t hear anyone’s voice. That’s why you have to be careful to pay attention to your customers and your partner’s words and adapt to the needs accordingly. Even one of our close partners agrees with this statement.

“JetRuby’s exceptional value sets them above competitors. Showing a genuine interest in the product, their team listens closely to feedback and maintains a thorough understanding of the business. Their ability to create optimal solutions to sustain a lower budget is impressive.” – Moments Inc., Julian Safford

On the contrary, there are cases where startups listen to their customers too much. Having that kind of overwhelming focus on what others speak, may also put in danger your entire business. Therefore, you need to have a strict balance where you actually listen to your audience and keep an eye on what your members say too.


And there you have it, 10 simple, yet crucial startup mistakes, which should be noted and acknowledged for your future product. As JetRuby was a startup once, we have walked across the same road that every young startup entrepreneur is walking now. We cherish and know what kind of fears and troubles you have in mind. Whether you really want to go for it or should back up a little bit more. And we value that and your time, that’s why we want to offer you a solid solution to cut down all of the troubles you might have!

The Design and Discovery Phase of JetRuby is a starting point for proper definition and assembly for your plan goal. If you’d like to know more about it, check out our Design and Discovery Phase for more information. Otherwise, you can share with us what kind of worry or milestone is troubling you and we’ll be on our way to you within the next 24 hours!

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