In large organizations and industries the concept of “paying your dues” is well understood as the process of doing entry-level tasks or overcoming a series of professional challenges before attaining a certain level of success. In the startup world, however, there may be no better way of proving you’ve paid your dues than by failing – and wearing that failure as proudly on your sleeve as possible.

Even if a startup goes out of business, for example, it’s assumed that those involved in it learned valuable lessons which they can bring to their next venture. Understanding – and surviving – major risks can be a proof point in getting VCs to invest their money in the right idea, particularly if a founder’s previous failure exposed them to a new opportunity in a similar sector. In no other community does the notion that failure comes before triumph carry such resonance.

It would be a huge mistake, however, for entrepreneurs to treat all kinds of failures the same. There is a big difference between an instructive failure, for example, and one that’s symptomatic of a poor way of working. Those are the failures that individuals can take with them from one startup to another – with disastrous results. Make sure the following aren’t among the failures you find yourself discussing with investors or anyone else:

1. Fixing Something Not Broken

While some startups are broad enough in scope to serve almost anyone, others are laser-focused on a specific niche. The only thing in common with those that die out is that they fail to offer a product or service that anyone actually needs. To some extent, startups may feel they need to get out in market with a product (or even a minimum viable product/prototype) to test the waters, but that’s not the only answer. Make the most of the tools available to you:

  • Analytics: As early as possible, start looking for predictive trends in customer behaviour – not only whether and when they buy but how quickly they put products and services into action, troubleshooting and other interactions. If the overall result is negative, it may not be too late to pivot the startup into something more valuable.
  • CRM: If you’re already launched and offering multiple products, CRM data can indicate where cross-sell and upsell opportunities exist. If you’re developing new features or a bundle of some kind, this is the information on which to base your decision.
  • Customer service apps: The best ideas can come directly from customer complaints, whether it’s features they wished they had, a faster way to perform an action or entirely new categories. By all means resolve their issues, but don’t forget to capture their insights.

2. Becoming Known Only As A Quirky Name

Startups don’t have the luxury of slugging it out for years in obscurity as their large enterprise predecessors might have done. Instead, they often have to come out of the gate prepared to serve a global market without having anything close to global reach. Poor marketing – or an utter lack of marketing – can doom startups to a miserable form of failure. The best entrepreneurs make sure their message is clear, compelling and consistent before they launch anything.

On the other hand, good marketing doesn’t begin and end with hiring a marketing specialist or team. It means being savvy and tactical about how you’ll disseminate content and drive demand. This is just a sample starting point:

  • Prioritize and build around the most optimal channels: Startups can’t be everywhere at once. Even if you believe in the concept of omni-channel marketing, develop a plan based on the areas your audience is most likely to search for information (online, via social media or at events) and harness marketing automation to track the results of your work across each of these touchpoints.
  • Develop a clean-data policy: Startup employees can have some mess on their desktops, but there shouldn’t be anything in their email database or other repository other than current, specific information with customer and prospect contact details, purchase history or trends and so on. This will be the foundation for everything you do. If it’s not where it needs to be, there are tools available to scrub it appropriately.
  • Set your monitoring and management work free: Working at a startup often means long hours, but they shouldn’t all be spent at the office. Consider how mobile apps might allow you to optimize marketing functions so you don’t get bogged down later on.

3. Running Out Of Money

It probably seems incredible when you’re struggling to get seed funding that anyone could burn through so much cash that they have to close their doors prematurely. It’s a fact of life in Silicon Valley and far beyond it, however. In most cases it’s not a matter of overspending on things like product development. It’s a failure to drive enough revenue to provide a sustainable, long-term future.

The only way for startups to avoid this kind of failure is to create an agile sales strategy that can shift and adapt based on market conditions:

  • Set pre-emptive thresholds for cost of user acquisition and churn: Getting customers is expensive. Keeping customers is expensive too. Looking at the resources you have available, provide the best estimate of what you’ll need to devote to these activities and how you’ll cope if those thresholds are broken. In some cases it might mean setting a reduced target on the volume of customers and more on your share of wallet within major customers.
  • Strike an in-person/online ratio for customer contact: In many cases new prospects, particularly large organizations, will be best served by a face-to-face meeting. There will be occasions, however, when a startup simply can’t travel the entire world pursuing opportunities. Get fluent as quickly as possible in selling via video, social media and other channels that boost productivity while ensuring customers have a good experience.
  • Lead with an account-based approach: More than ever, companies are buying in teams rather than individually. As much as startups might imagine a single executive making a decision and cutting a cheque, there will often be layers of consultation and approval. Organize your CRM and your team’s efforts accordingly.

Failure is a fact of life among startups, but if you follow the advice above, even entrepreneurs that start all over again at some point are at least more likely to have the sort of failure they can be proud of.

Looking for more advice related to startups? Read our post “The Difference In Sales Enablement For Startups” for tips on how to engage staff and boost sales.