For an article that is about fatal mistakes, this one comes with a congratulatory note. Yes, congratulations! If you are reading this article, then you are doing yourself a huge favour – that of increasing your chance of avoiding the same fatal mistakes start-ups make. Keep going!
In fact, an overarching mistake is having a notion that because you are a start-up, you are “entitled” to make mistakes.
Here are two reasons why that mindset is wrong: First, you are a start-up and chances are, you have very little room to make mistakes in terms of your time, money, and other resources! As much as you can, avoid making mistakes. Avoid thinking you are “entitled” to making mistakes. Plan every move and before you know it, you would have ticked off every box in your start-up to-do list without any hassle!
The second is because there are many start-ups ahead of you from whom you can learn nuggets of wisdom! Why do you have to make the same mistake again when you can learn from the mistakes others made before you? Think of this as leverage – this could be the very first suitable application of the word as you spring into building your own business!
That said, here are the 7 fatal mistakes start-ups make when incorporating a company in Singapore:
Mistake #1: Thinking that a good idea is a good business idea
So you had a light-bulb moment, an epiphany of what you think would be a brilliant business! Hold your horses, this doesn’t mean you’d need to strap on and gallop away! A good idea is different from a good business idea. You have to put this idea through a road test and firmly establish a strong business case for it. Most of the time, businesses who take off too soon come crashing back too soon as well. You do not want this to happen to you.
Some questions to guide you as you establish the business case for your idea are:
- What is your why? Remember the movie “Collateral Beauty”? Why do you want to set up this business? What do you want to achieve? What is your inner why for doing it? You must remember that establishing a business requires a lot of work – many times unpaid especially in the first year or years. But with your inner why fuelling your passion for your business, you will have the energy it takes to get you from A to Z.
- Why would people buy this product or service now? What needs or desires does it fulfil?
- What makes the business viable this year and in the next 50 years?
Mistake #2: Having much ado about nothing – aka: Spending too much on unnecessary advertising
Ever heard that phrase “A business with no sign is a sign of no business”? It’s an advertising pitch that is as old as time. Branding and advertising are important elements of the business, there’s no confusion there. But it’s when you spend too much on advertising than what is absolutely necessary at the moment that can derail your start-up business from the right track.
And it’s not just about committing the sin of over the top advertising, it is also NOT advertising on free platforms. If you’re not printing a decal to advertise about your carpet cleaning business on your car, then you’re missing out on a huge and free advertising opportunity. Do it now!
Mistake #3: Jumping on an opportunity without carefully studying it
We go back to another Will Smith movie, this time, The Pursuit of Happiness. Remember he was selling bone scanners during better days? He invested all his money into buying mountains of bone scanners and had high hopes it would sell. Boom! It didn’t. And so he thrusts himself into a journey through bankruptcy, self-reliance, and triumphing over adversities. No doubt, Christopher Gardner, the person whose life Smith portrays in the movie, has an admirable character that every striving start-up entrepreneur should emulate.
More to that, it’s important for you to learn the lesson which was not as much highlighted in the story but is highly important: Carefully study an opportunity before jumping on it. They say opportunities don’t always come by your way. We say, create opportunities, don’t simply wait for them to come. American educator, writer and speaker Stephen Covey said “The best way to predict your future is to create it.” He could not have been more right.
Mistake #4: Missing the point on business scalability
So, you have a flourishing business. After your many sacrifices, your business is already starting to bear fruit. Is it time to pull a pool bench, put your feet up and sip some champagne? Probably, but don’t linger on the celebration mode for too long. You need to scale your business – chart its future growth. Where do you grow from here? How else can you create opportunities? What innovations can you think about? What future markets are there to reach? These are just some questions that will help you scale your business.
Remember, building a business is like erecting a mighty fortress. You will never know when the wolves of adversity would strike – high taxes, new competitors, loss of customers, etc. You have to surround yourself with strong fences that cannot be brought down – scaling your business for success helps you achieve this.
Mistake #5: Doing everything on your own
Can you start a business in aesthetics dermatology if you’re not a skin doctor? Can you open a restaurant if you’re not a chef? Can you run a design studio even if you’re not an interior designer?
It helps to have a technical knowledge or familiarity with the nature of the business you would like to pursue, but it isn’t absolutely necessary. Businessmen need only to hire and pay the best doctor, chef, or interior designer to join his or her team and voila! They have a business.
It’s the same when you are incorporating a company in Singapore. You don’t need to do everything on your own, especially if this means diving into an aspect of the business, like registering your company, of which your knowledge is zilch. Are you stuck? No, of course not. You can, by all means, register your business. Engaging a professional business registration firm will get the work done for you. Lesson? Don’t do everything on your own – you might find it counter-productive and inefficient to do so.
Mistake #6: Launching the business without incorporating
A big no-no. You cannot launch your business without incorporating. You will have a head-on collision with the authorities if you do so. Remember to operate your business responsible and legally. Run your business once you have incorporated it.
Mistake #7: Failing to comply with regulations
Compliance with the regulatory policies of the Accounting and Corporate Regulatory Authority (ACRA) is important for you to be able to run your business worry-free. You simply cannot be at odds with the authorities otherwise you could face hefty fines or even risk your business being padlocked.
There’s a painful lesson to be learned from a big shot immigration consultancy firm whose owner did not take reporting and compliance seriously. His business went belly in as short as one month after a client refused to pay him millions due to him not filing his taxes properly. Instead of paying him, the client reported him to the authorities and just like that, he found himself in double jeopardy: No collection from client, and penalty from the tax agency. This should not happen to you.
To help you with your company registration and compliance needs, engage a reliable, professional and seasoned incorporation services firms who will help you firmly establish your business from the day of incorporation and while it operates. Company incorporation firms will make sure your business is always in good standing with the government and can operate freely without worry. Good luck!