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What Hurdles Have to be Overcome When Setting Up a Company?

Those who start a company inevitably come across hurdles on their way. Every seasoned founder knows that failure is an integral part of success. Such challenges always bring with them an opportunity - the chance for change and thus also for improvement. 
 
Ultimately, every startup has to find its own way. The hurdles that are encountered differ from case to case. However, experience shows that some difficulties occur more frequently and cause problems for many founders. So if you know these, you can react early and correctly or even avoid them preventively. Which are they?

What Hurdles Have to be Overcome When Setting Up a Company?

What Hurdles Have to be Overcome When Setting Up a Company?

Mistakes are human, but avoidable!

Everyone makes mistakes - especially when starting a business. It is a natural learning process, which of course, at best, ultimately leads to success. However, this also explains why an estimated 80 to 90 percent of all startups fail within the first three financial years. Follow-up financing, for example, is a frequent stumbling block or the hiring of the first employee. Such hurdles can cost a startup its head, but can often be avoided if the founders prepare properly. So what are the common hurdles and how can they be overcome?

Put focus on the business idea

A startup stands or falls with the business idea. The right product or the right service is not a guarantee of success - but no company can function the other way around if its business idea has no market. Comprehensive monitoring before founding a company is therefore essential and the most important part of the business plan. 
 
The aim is to identify market potentials as well as competitors and to calculate realistic (!) Future forecasts based on this. Many founders consciously or unconsciously tend to "gloss over" - because they are convinced of their business idea and the dream of their own company.

Lack of liquidity

The lack of cash, i.e. the lack of liquidity, is the undoing of many startups. So you cannot financially bridge certain losses or idle times and therefore have to give up before enough customers and thus income can be won. This can happen before entering the market or in the first few years of business activity. 
 
Once these have been mastered, follow-up financing - as already mentioned - is also a frequent problem. When the first seed financing or subsidies are used up, there is no money for further growth after around two to three years. 
 
The company's liquidity must be ensured from the start. If necessary, preventive negotiations with investors and business angels can be worthwhile, so that they can quickly step in with bridging financing if the worst comes to the worst. Another tried and tested strategy is to position yourself internationally at an early stage and to find investors for follow-up financing before it is too late.

Digital transformation

The business world is in the midst of upheaval, but many companies are struggling to make the leap into the digital era. Saving at this point is one of the biggest mistakes for startups. Because later on, all the larger investments are required to master the digital transformation. In addition, it can mean a major competitive advantage to put the company on "digital" legs already now, while the established competitors are still lagging behind. 
 
However, this also applies to digital administration. A study came to the result that 63 percent of founders want administrative processes to be digitized. Every founder should digitize the company as comprehensively as possible from the start. However, it is important not to lose sight of the interfaces. This applies to digital administration, for example. 
 
Which digital systems are invested in also depends on the partners in the digital administration and their “basic structure”. With what and how do the future business partners and administrative authorities work - this question decides in which digital components a startup should invest.

Team building

Besides the financial, the human factor is the biggest risk in any startup. As it continues to grow, employees usually have to be hired and teams brought together. The founder slips into the role of manager and - at least at the beginning - often that of HR. At this point, however, a lack of know-how or poor knowledge of human nature can have devastating consequences for the company. 
 
Many failed startups report teams that do not fit together. Conflicts, misunderstandings and the resulting errors can cost the company a lot of time and money. Well-trained, reliable and above all motivated employees are the cornerstone of every successful company.
 
The selection of employees and team building should therefore ideally be entrusted to a professional right from the start. The first employee to be hired is therefore an experienced HR manager or recruiter in the “best case scenario”. In addition, teams have to be brought together consciously and under strong leadership and not left to chance. 
 
If the founder himself does not have the necessary leadership skills or simply the time to fulfill this role, it is also advisable to hire an appropriate specialist. Finally, professional conflict management and the courage to disband inharmonious teams if necessary are required.

Wrong problem solving

Products or services are successful in the market when they solve a problem. However, these are often bogus problems. In reality they do not exist at all or only to such a small extent that the target group is too small. Perhaps the problem isn't bad enough that you would spend (a lot) money to solve it. Experience shows that those startups who know the problem themselves enjoy the best chance of success. 
 
The founders themselves suffer from the problem of a special illness and therefore know exactly what their target group wants and needs. If you want to solve a problem that you don't know yourself, you have to exercise double caution. At best, experts with the relevant experience are then included in the start-up process.

Quality defects

Even if the core product is based on a good business idea and offers promising prospects, it still has to be implemented “well”. Quality is the be-all and end-all for every company, because word quickly gets around to the target group whether it can keep its promises or not. 
 
Quality deficiencies can thus cause devastating damage to the image and kill a startup before it could even establish itself on the market. It is therefore important to attach great importance to quality management right from the start. Missing financial or time resources must never be compensated at the expense of quality. It is therefore unchanged at the top of the priority list - and instead, problems with other levers such as financing, staff & amp; Co rotated until the desired result is obtained.

Customer feedback

Without customers who are willing to pay, satisfied and loyal, no company can exist in the long term. Founders should therefore be aware of how valuable customer feedback can be for them. Instead of ignoring this, it must be deliberately obtained and evaluated. 
 
Ignoring customer feedback is therefore one of the most common, but also most dangerous mistakes in the early stages of a company. At best, customer feedback is already obtained before (!) The company is launched. In good German: Surveys of the target group in advance can help with the creation of the business plan and thus steer the startup in the right direction from the start. 
 
Then it is important to see the dialogue with the customer as an ongoing cycle - a process between constant feedback and constant improvement. The closer the company stays to its potential or existing customers, the lower the risk of losing sight of them. Because then problems such as complaints, migration to the competition or insufficient income follow - to name just a few examples. Customer feedback is also the starting point for any marketing strategy.

Conclusion

Ultimately, it is never possible to predict with certainty whether a startup will be successful and what hurdles it will encounter - or which obstacles it will ultimately fail. Every founder should be aware that he has only limited control over the future and that his project always entails a great risk. 
 
But those who tackle the most common problems preventively will at least have better chances and will not be caught unawares. This does not mean that these hurdles cannot still arise. But at least the founders then already know how to deal with them and plan in the “right” direction in the long term.