The 10 biggest entrepreneur challenges

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So, what are the biggest problems of entrepreneurship?

Starting a new business can be very exciting. I bet you've already thought of a great idea and considered quitting your day job. For most people, it's the ultimate dream career move. No more working for someone else; you're in charge.

And there are lots of great reasons to start your own business. But with the good comes the bad. Entrepreneurship can be challenging. Let's be honest; if it was easy, everyone would do it. But most new entrepreneurs fail. In fact, the statistics for being a successful entrepreneur are not good at all. Around 20% of new businesses will close within a year, and that number jumps to 65% in the first five years. So over 80% of companies will ultimately fail.

In order to beat the odds and make a business a success, you need to understand what challenges you will face. Only by understanding what's coming can you prepare for business success. So what are the biggest challenges facing a modern-day entrepreneur?

We've taken a look at the main reasons new businesses fail and the most common problems entrepreneurs face.

New businesses struggle to find start-up capital

You know what they say; “Money makes money”, and it's no secret that small businesses need an injection of money before they make any money.

Before you can make a business profitable, you need to invest. From marketing material, premises, production, staff wages and inventory to sales, product development and primary resources, entrepreneurs usually need to rely on investors or crowdfunding to get a business going.

One problem for many new entrepreneurs is raising this money in the first place. You may need savings, good credit or a loan. The second is knowing where to spend the money and where to save. You often get one shot at launching a business so putting your money in the right places is crucial.

Facing the challenge:

Create a budget, assign funds to each area, and stick to it. Try to get as much capital as you can before you launch and learn proper cash flow management. You should also apportion some cash to a contingency fund because you'll probably spend more money than you think. Entrepreneurs who learn to manage cash flow and raise sufficient start-up capital have a greater chance of success.

Most entrepreneurs are afraid

Fear and self-doubt are some of the biggest reasons entrepreneurs fail. Afraid of criticism or rejection, afraid of failure, afraid of quitting your current job, or afraid others will judge you. You name it; entrepreneurs have plenty of reasons to be afraid.

Business can be intimidating, and fear can be paralysing. It can trick your mind into overthinking, panicking, making a decision you won't usually make or stopping you from making decisions at all. Fear is the reason most great business ideas never become more than an idea. To make a business profitable, you need to take risks. It's hard to have your own company if you are too afraid to jump into the deep end.

On the other hand, having no fear can also be a bad thing. Fear gives you the drive to succeed and motivation to keep trying. So if you're afraid, it doesn't mean you'll fail, just make sure you control your fear and don't let it control you.

Facing the challenge:

Identify the things that make you worried and give yourself a deadline for decision making. Try writing them down to help deal with your anxiety. If it helps, try talking about your fear with friends or a life coach or therapist. Make a note of all the things that could go right if you take a risk to help you through tough times.

Breaking into the market is a big challenge

One challenge facing entrepreneurship is getting the big break. Entering into a new market requires not only a proper solution to a customer problem but an excellent marketing strategy. Even then, you might not be able to compete with other companies.

It's a challenge to make a name for yourself, and your brand and overnight successes are sporadic. To break into a market means growing slowly and organically. First, you need to make sure that whatever solution or services you provide are ready to compete in your market. If a market is saturated, you need to know your USP before starting marketing. Just because you don't burst onto the market immediately doesn't mean you won't eventually have a good market share. Determination and consistency are crucial.

Facing the challenge:

You need to prepare for the long haul. Before you launch, do plenty of market research by finding customers and asking what they actually want. Look for gaps in the market and write down how much of the market you want to conquer. Remember that this is a marathon, not a sprint.

Finding the right staff for a new business

Being a business owner means delegating tasks to staff. But that means you have to hire staff to begin with. Sometimes, it can be hard to find people who are willing to share your vision and believe in your dream before it is a success.

To build a successful business, you need to create an effective team. Many businesses fail because the boss hires the wrong people. You need people who can successfully work together to further a collective dream. You want a team, not employees. Hiring the right new team member can be one of your greatest assets and will help with solutions.

In the short term, many young entrepreneurs rely on family and friends to provide support and manual labour. Eventually, you will need to have your own employees who will help shape the future of your business. Creating a good team as soon as possible is essential if you want to beat the odds and make it past the one-year mark.

Facing the challenge:

Focus on having a solid hiring process to ensure you attract the right kinds of people. Grow slowly, making sure you focus on quality, not quantity. Try thinking of hiring employees as a long-term investment, not a short-term solution.

Time management can make or break an entrepreneur

Once you've found your team, you need to actually use them. As a new entrepreneur, you might not be used to being the boss, so delegating might not come naturally. But you have to learn to delegate tasks and manage your time effectively so you can actually have a work-life balance.

Time management is one of the biggest challenges a new entrepreneur will face. There are never enough hours in the day to get everything sorted, and there will be a million different things pulling you in a thousand directions. Learning to delegate tasks and manage your time so you can focus on the big stuff will make a huge difference and could be the reason you succeed where someone else fails.

Facing the challenge:

To help 1anage your time efficiently, try:

• Creating a goal list
• Write a practical to-do list with solutions
• Delegating small tasks to others
• Work out what needs to be completed immediately
• Be open to new, more efficient ways of working

Bad market research can ruin a successful business

You need to know what your customers want. So many companies fail because they don't adapt to market research and appeal to their customer base. Whether you are offering a product or service, it has to appeal to your target market. Success is based on what your customers think.

When you're starting your business, the only way you will be able to grow your business and be successful is if you have a steady stream of customers. Whatever you're selling needs to appeal to them. Conducting market research to create a marketing strategy should be a priority. You need to find out what your customers want, not what you think they want.

Facing the challenge:

Gather more information about your demographic and learn how much customers pay on average in your industry. Look at competitors and find what sets your solutions apart. The more information you have, the better your offering will be. You will need to dedicate funds to marketing research.

Overcoming rejection and staying motivated

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Failure is a part of any business venture. If you are entering the business world for the first time, chances are, things will go wrong. It's crucial to ensure you stay focused, ignore critics, and forge ahead. Facing criticism head-on and overcoming challenges when you have a setback will help you become resilient and, in the long run, will help you succeed.

But it can be hard to stay motivated in the face of rejection. Many entrepreneurs struggle to distinguish between constructive feedback and criticism or rejection. Take time to work out who is trying to provide feedback to help you succeed and who is simply passing judgement. Listen to one, ignore the other. Finding ways to overcome rejection and improve your small business will eventually lead to business growth.

Facing the challenge:

Think about whose opinion matters to you. If you would go to someone for advice, their opinion should be considered. If you wouldn't go to someone for advice, ignore their criticism. Instead, try to take feedback well and if you are rejected, ask why and what could turn the no into a yes; you might be very close to success with just a few small solutions.

Adapting your business makes for business success

Sometimes, things don't go to plan. When you start out as a new, young entrepreneur, you will have big dreams and have probably spent a lot of time refining your business model and your strategy and plan. You might even check out what other entrepreneurs are doing to check your business against theirs.

Having a plan is a good thing, but as your environment changes, you should be able to change (but remember about staying focused). The market changes fast, so you need to adapt and react to prepare for a better future like other “successful” business owners. Remember, success leaves clues. So the creative ability to respond to situations and realise your original plan won't work is essential.

Facing the challenge:

Think about the things you are not willing to sacrifice. This could be your time, commitment to the environment or ethical standard. Write it down to make sure you stick to it. Remember that anything not on that list is up for debate. If in self-doubt, ask other people for advice on what needs to be changed.

Changing your daily habits makes you a better business owner

It can be hard to get out of the employee mindset. But when you are the boss, you need to act like one. And this is more than just a job. This means changing your daily routine to cultivate healthy habits that will set you up for success. The small things you do every day will help you develop a solid mindset to lead your company rather than acting like any other team member.

Taking care of yourself is as important as taking care of your business. Cultivating a routine that allows you to have a healthy body and mind will help you stay focused as your business grows. How can you give your company 100% if you're running on empty? You need to deal with stress to overcome challenges.

Facing the challenge:

Good habits to develop include:

• Waking up early
• Setting goals
• Creating a work-life balance
• Developing a network of inspirational individuals
• Exercise Regularly
• Healthy diet

Failure to consider success could prevent future growth

While entrepreneurs face many challenges, most are prepared and research what to do when things go wrong. However, very few research what to do when things go right. If your business is profitable, you need to prepare for business growth. A profitable business will naturally gain a larger customer base, require more resources and team members, marketing will become easier, services grow, and your business will take on a life of its own.

You need to prepare for success. You should be aware of your next steps, or you might find you are the reason preventing your business from growing. It's a nice problem to have, but it's still a problem.

Facing the challenge:

Think about long term goals and consider what your next move will be once you've achieved your first goal. Have a plan for growth once you've reached a basic level of success. Once your business is off the ground, you should re-aim, refocus and push for an even greater future.

The challenges of Entrepreneurship

Being an entrepreneur isn't for everybody. It sounds like a dream and can provide a great source of income and a good work-life balance. But it's hard work, comes with a lot of self-doubts and, especially in the beginning, can feel like one problem after another.

It can be mentally challenging to become a business owner, and there is a lot to plan, change and consider before getting started. One of the key lessons of entrepreneurship is knowing when to ask for help. Whether it's a team member, friend, family or a business coach for entrepreneurs, just because you're launching your own business doesn't mean you have to do it alone.