Why your startup isn’t making any profit

Why your startup isn’t making any profit

When you first start pitching your business idea to the world, there is no worse feeling than someone telling you they don’t think it will work.

Since that is your deepest fear, when someone articulates it, as someone invariably will, it will rip to your very core.

It happened a lot when I was starting out. To feel better, I would tell myself that they were idiots who just didn’t understand my industry as well as I did. Any success they had in business was probably down to luck.

In short, I would come up with any number of increasingly creative justifications that would allow me to restore my fragile ego.

More than a decade later and on the other side of half a dozen businesses – some successful, some not so much – I find myself biting my tongue when I get pitched new businesses. It turns out that some of those ‘idiots’ I met early on may have been able to see the red flags in my model, regardless of the industry they were in or the luck they had been on the receiving end of.

Here are some of those red flags in the five areas of a business that may keep you from ever profiting.

The pitch

You may know your own pitch, but your business will get nowhere if other people do not understand what you are talking about. Never throw in jargon that people won’t get, especially if your product is one of the first of its kind.

A common mistake: Talking a lot about what will happen to your business in the future, but nothing about the results your actual clients are getting right now.

Remedy: The average person is more clever than you think. Just because you keep the language simple, doesn’t mean you need to present it in a boring or condescending way.

Content marketing

Everyone these days is talking about content marketing, about positioning themselves as thought leaders and helping to educate their market.

A common mistake: Thinking that you are above content marketing, and that one day journalists will be tripping over themselves to write about you and you’ll have all the credibility you need, so there’s no reason to invest in doing their work for them now.

Remedy: Early in your business, it’s best to share your ideas. Nine times out of ten, your product needs help speaking for itself; providing content that complement your business goals and services can help shape your company’s stance in the industry. Who knows, you might even win over some new customers who discover you through your blogs.

Product ecosystem

Starting out, you may face the dilemma of whether to expand your offerings, or stick to one product and one product only.

A common mistake: You have one product or service. Refuse to deviate from that. Once it becomes a household name, you might start to add new products to the mix, but for now just keep focused. If the market isn’t buying enough of it then it’s clearly because the market are idiots.

Remedy: There’s a reason 99 percent of successful businesses have multiple product lines. Before completely ruling out this option, think about whether this will improve your company growth and offer your customers options. You want to retain customers by giving them what they didn’t know they needed.


So many businesses fail to realize how much can come from personal appearances and marketing outreach.

A common mistake: You see your competitors out there shamelessly talking about their business on stage or pandering to the media to get their opinions on the latest topic. Sure, it might drive products sales and revenue for them, but you signed up to be an entrepreneur, not some talking head.

Remedy: Don’t wait for people to come to you or hope that they’ll just magically find you by the good grace of Google. Follow up, put in work, contact your sources and know when to be persistent about making your name heard.


Oftentimes, new companies can use a helping hand from established businesses by partnering up.

A common mistake: Shoot for the stars – and stars only. Thinking that if you could just partner with Google, David Beckham and Mastercard, this thing would be through the roof! Maybe they are not returning calls right now, but that day will come.

Remedy: Just as you need partners, there are other people who want to partner with you. Don’t underestimate the power of teaming up with small companies and growing together – this includes your co-founders and early employees!

I feel obliged to say at this point I have ticked all of these five boxes of mistakes on many occasions, it is easy to do. I also may have been guilty of acting slightly petulant when people tried to point out these small errors in my approach.

However, should you be looking to keep your business small and unprofitable, then by all means, continue to make your mistakes. Fudge your pitch, keep your knowledge to yourself, only have one product, stay out of sight in your industry and finally do everything in isolation. These are the best ways to stay unprofitable.

But if you are like anyone else trying to make a buck off this whole entrepreneurship thing, it’s time to lower your ego, reflect on your strategy and determine your next best course of actions.

This article originally appeared at: Thenextweb.com and published at: https://www.linkedin.com/pulse/20141105235347-454748-why-your-startup-isn-t-making-any-profit/

About Callum Laing

I bring together small, profitable, owner operated businesses from around the world into a fast growing publicly limited company. This gives the business owners access to bigger contracts, liquid stock, unlimited partnership opportunities whilst still keeping full control and autonomy over their business.

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