8 Ways to die in entrepreneurship and the lessons learned

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[]i Black Horse has contacted many entrepreneurs in recent years, just as the legendary, more than 90% of the start-up companies will eventually die. In fact, "death" is not scary, because failure is the normal business, the key is whether you learn from the experience, and again to the road to success, let us look at the most common among the 8 "death", and the lessons learned.

How can new entrants avoid the big pits on the road as far as possible? What experiences and lessons have been learned as an experienced person? We have summed up happy net, public comments, Storm audio and video, Fank and other entrepreneurial process of the eight major lessons, the first 5 are operating level, the latter 3 are management level. Generally speaking, management is subordinate to management, management is the choice of things to do, management is to do things right. To start a business is to choose the right things, but also to do things right, indispensable

1. Copy the foreign mode, do not pick up the atmosphere

For the past 10 years, Silicon Valley has been a source of inspiration for Chinese entrepreneurs. In anticipation of successful replication, it is also necessary to consider the risk of acclimatized in the Chinese market.

In recent years, the start-up companies, whether booking hotel room for the Night Hotel special, or short-term rent for the love of tenants, as well as light blog point, all in the replication of the United States model of the acclimatized halfway, had to separate his way forward.

Even entrepreneurs with rich experience sometimes fall into the same trap. The successful operation of the network of Xu Chang founded a dot net, trying to replicate foreign light blog site Tumblr brilliant, but backfired, the point of the end did not meet the market expectations, other Chinese imitators are also disappeared. The reason behind this is also the difference between the Chinese and American Economic and cultural backgrounds. Tumblr-style Light blog represents the minority culture, but in the United States, a high standard of living, holidays and enjoy sharing a large number of users, Tumblr and the international market to do the support, these conditions in the domestic DOT network are not available. Coupled with micro-blogging and watercress two social platforms have squeezed the existence of light blog space, starting a year after the point of the network into a difficult to maintain the state.

2. The needs you define are not necessarily true

Finding the right target user's real needs is the first step to starting a business. The initial stage of the entrepreneur market research lacks rigorous data analysis, but by intuitive judgment, and even from their own needs to judge the market, there are often a lot of errors.

Founded century Jia Yuan Network gong is a senior entrepreneur. 10 years ago, Gong founded the cause of the century Jia Yuan is that they can not find the object. 10 years later, when Gong again use this way of thinking to think about the next entrepreneurial direction, she thought of her English pain point-not spoken, decided to enter the foreign language training market. But this two-time venture from the solution of "self demand" failed.

Gong initially wanted to cut into a market that was more profitable than the marriage market, and to find a more likely breakthrough. But the real investment in the market only to find the difficulties, first new Oriental founder Wang Qiang think the direction of the problem to give up investment, then in product design, the company encountered multiple difficulties. After that, Gong gave up the foreign language education and chose the basic education market instead.

To find out what users really need, refer to the "Lean Entrepreneurship" promotion of the MVP (Minimum viable product) concept, meaning "the simplest possible product"--in the fastest, most concise way to build a usable product prototype, this prototype to express the end of your desired product effect, Then through the market test, rapid iterative adjustment of products.

3. Experience may also be "baggage"

The successful experience of the entrepreneur represents a period of summary, but it will fall into the mindset and path dependence. Angel investor Paul "Graham summed up the development curve of the start-up company: Startups tend to be in a fast-rising curve in the early stages of entrepreneurship, and entrepreneurs have not yet touched the wall and are in" ignorance of optimism "; But after the initial rapid development, the start-up companies will face more and more problems, Companies began to enter the "Entrepreneurial Despair Valley", many times after the hit, entrepreneurs will enter the "known pessimism." The two times that the public reviews is a typical representative of the entrepreneurial curve.

Founded in 2003, the public comments network, in the first 7 years of entrepreneurship, has been tepid, until the mobile internet to meet, only to start to glow youth. 2010, the public comments began to shift the direction of the mobile Internet, where the public comment on the biggest change in business is from the past advertising business, began to dabble in local life services such as group buying. Because the public reviews through years of accumulation, already has a large number of business information, so the outside world is considered the most suitable for local life services company.

In fact, the pattern is very different. The public comment has been and business in the past, the hope that the business in the public comments on advertising, this is a content or media model. While group buying is also dealing with businesses, but it is the hope that businesses to sell things here. The two patterns appear to be consistent, but they are very different in actual execution. Public comments in the field of group buying, or in accordance with the original practice of slow company, there is no first time to rapidly expand the city, and that three or four-line city users do not buy the demand, but later found wrong. Consumers in the three or four-line city don't like to comment or look for restaurants, which doesn't mean consumers don't want to save money.

4. Environmental upheaval and a crisis

The fatal crisis of a start-up enterprise often lies in the fact that when the market changes, it is not adjusted in time and discarded by the users. Once hit of happy net, the dimensional city is so.

Happy net by virtue of "stealing vegetables", "parking game" swept all over China, to occupy white-collar market, become SNS Market and Renren's social networking site. But happy net leap after red, encounter the "True Happy Happy" and Sina Weibo Weibo online two ridge. Whether it is the popularity of the Shanzhai net streaming, or Sina Weibo online, all let happy net vitality big injury. At the same time, happy net internal innovation is insufficient, after hit, did not surpass 2009 before innovation.

The main coupon business of the city also suffered a roller coaster-like dilemma. With the advent of the mobile internet era, the traditional printing paper coupons, the core business of the mobile phone app gradually replaced, in the face of such a sudden change in the environment, the city has not been able to adjust and carry out new business in time. This made the failure of the city almost inevitable. In its heyday, the city had more than 1500 terminals in Beijing. But then, there are only two digits left in the outlets. As the end-machine disappears, the company also shrank from more than 2 000 at its highest peak to less than 200 people before the tick-tock merger.

5. High risk of large-scale transition

Constantly adjust the market positioning, restructuring products, the risk is also very large. Grasp the "change" and "unchanged" degree is the key to success or failure of entrepreneurship.

The success of the vertical internet market is everywhere, such as the tourism market Ctrip, the real estate market, the SouFun, vertical market success is often the premise: the size of the market segment is large enough, high degree of standardization and a certain industry barriers. The entrepreneur to the vertical market judgment is apt to deviate, some vertical market often appears to exist the opportunity, but in fact only temporarily blank, once becomes the horizontal integration goal, the entrepreneur's market space will lose. For example, Footwear electric Shang was once a representative of the vertical electric quotient, along with the cat, the Beijing-east further bigger, become the lateral expansion of a larger platform, it was forced to start transformation.

The transformation choice of Amoy from channel system to buy hand system, and experienced the internal structure adjustment, the whole supply chain exchange transfusion and the disguised redundancy. The direction of doing its own brand is not wrong, but in the implementation of extreme. The original shoe electric business platform was cut off, the new birth of its own brand lack of strong maternal support. In fact, the original platform can be operating on the basis of the implantation of their own brand, slowly raised, at the same time to major channels distribution. In addition, the 5-brand approach is also too radical. Changxian's young operations team was unable to harness 5 brands. In a number of traditional footwear companies with extensive experience, it is not easy to make a brand, and it is whimsical to make 5 brands. In this way, Le Tao disappeared.

When the entrepreneur chooses the direction, enters a relatively blue sea the pioneering field is feasible. However, it is more necessary to consider whether this field is compatible with its own capabilities and the resources that can be mobilized in the entrepreneurial process. Entrepreneurs often ignore the subsequent resources support capabilities, once found in this direction is not available, can only choose transformation. The company's repeated transformation means that overall systemic risk is at hand.

As the first graduate of Innovation Factory, dim sum has been shrouded in a variety of entrepreneurial aura. It is the first company to be registered in the family of innovative workshops, and it is also the first entrepreneurial project to graduate. As the first start-up to kill into the handset operating system market, dim sum quickly encounters the Red Sea of ROM. Dim sum hope and Samsung and other big manufacturers, but eventually only sharp and other second-line handset manufacturers agreed to test water with it. At the same time, dim sum has not established its own core fan base, the product version iteration speed is also very slow. In the end, it found that doing ROM was not what it was doing, and then working from the hardware to the Android System tool optimization. In the ensuing transition, dim sum encountered the choice of ROM and Android system Tools two, eventually choosing the direction of the Android System tool to package the first mobile OS product line for sale. In order to further enhance their commercial level, in early 2013, dim sum accepted Baidu's strategic investment into the security market.

6. Rapid growth of excessive expansion and management control

Compared to the hard times of startups, there are other companies as pioneers of an internet subdivision (such as electricity dealers, group buying), occasion the rise of China's economy and consumption, relying on a round of rounds of financing and other factors have a perfect start, but there are dangers behind the steep growth curve: massive burning of money leading to huge losses, Company personnel speed expansion, quality is mixed, superstitious marketing power and ignore more basic quality problems ... Companies, like the soaring rockets, suddenly lose power and plummet, and the risk of runaway increases dramatically in the rapid expansion.

Where the customer prudential products and handle network is a typical case.

Founded in 2007, where customer Prudential products, has been a typical Fast Company sample. "I am a guest" when the object is popular, 2009-2010 years where the customer ushered in a crazy expansion, but followed by a huge regulatory loopholes: Hundreds of millions of backlog of stock reported damage, destroyed or sold at a low price; due to excessive expansion of the category, where the early clear clothing brand positioning gradually blurred, suppliers and quality management appear out of control; The staff has increased dramatically, but many employees have nothing to do ... Lei and other investors in the new round of funds, where the customer began a "millet-style change", but more and more signs that the customer has been unable to recover lost ground by conventional means.

The quick drop of the handle net resembles the guest. As a domestic group buying market early once occupied the first place of the company, handle network from the establishment to submit the listing application less than 2.5 time, but after a huge amount of financing and high-speed development, its impact on the listing to expand the scale and performance, resulting in internal management confusion, completely rely on the burning of money to expand market share, in the listing blocked quickly fell, Fell out of the domestic group buying market first camp.

7. "Brotherhood" buried team infighting hidden dangers

It is a welcome step for startups to get the Venture of venture capital, or VC, but the relationship between the founders and the investors and the management of the company has become more complicated. There is a conflict between investors and management, as well as the founder's internal equity distribution imbalance, will increase the uncertainty of start-up enterprises, maternal and infant supplies started by the electricity Shanghong Child is a typical sample.

Xu Xianxin, Li Yang, Yang and Ma Jianyang several good brothers to set up a red child, formed a ceo+3 management pattern, four personality complementary, Xu, Li, Yang, horse four red children composed of the core team's cooperative combat ability also become venture capitalists believe red children an important condition. After introducing multiple rounds of financing, the contradictions between the founders of red children began to sprout in 2006. After obtaining venture capital, Xu Xianxin's discourse power gradually increases. At this point, Li Yang, Xu Xianxin Strategic differences are also increasingly prominent. is to continue to focus on maternal and infant supplies market, or introduce cosmetics, 3C (China Compulsory certification, Chinese compulsory product certification) and other categories to do a comprehensive business (Business to Customer)? Li Yang insists on the former, Xu Xianxin insists on the latter.

In two contradictions can not reconcile, venture capitalists support Xu Xianxin, Yang also chose to stand on Xu Xianxin side, the board decided to let Li Yang and his wife Wang Yu leave. The other two founders were left behind for internal reasons, and the founder's team was left with a Xu Xianxin that was thought to represent the will of capital. September 2012, Suning announced 6 6 million dollars to buy red children, red children into Suning's mother and child channel.

8. A model that relies too much on partners is problematic sooner or later

Many entrepreneurs in the early stage of entrepreneurship will be due to insufficient funds, environmental factors and so on to choose entrepreneurial partners. The choice of entrepreneurial partner is also a technical work, if the election is not good, it will lead to the failure of entrepreneurship. The giant whale is the rise of Google China, but also because of Google China and decline.

Whale by Yao Ming, Yao Ming brokers Zhang and Chen joint venture, the three-party funding scale reached 2 0 yuan. With the help of Yao Ming's huge star effect and music genuine persuasive power, the giant whale soon encounters the "noble"-Google China, the two sides launched Google Music Search. This cooperation not only makes the whale 1 5 million dollars of investment, but more importantly, the whale to obtain huge resources and income.

After Google shares in China and reached a music search cooperation, whale thoroughly alongside Google China's thigh, the loss of Google China's technology, traffic, resource support, the giant whale has been the illusion of Google, failed to come up with a selling point of the product, did not reflect the new development of ideas, leading to their own in a passive delay can not reverse the crisis. 2010, Google announced the withdrawal of China, let all of a sudden halt.

Another company has a similar experience. As a Google Elite founder of the search engine company, and so would like to rely on the early investor Sina this big tree into the social search field. Originally, in the search market pattern has been set in the circumstances, to do social search on some Don "Quixote style of adventure, Sina Weibo resources can not fully meet the team's big hope, and so the founding team can only run away."

Article Source: "Lesson: Internet entrepreneurship must avoid the eight misunderstandings", machinery industry publishing House, a great company, published in August 2014