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The theme this week deals with the creation of a new business and managing that new venture Based on the videos, readings, and your own experience/knowledge, what are the TOP TEN biggest challenges facing an entrepreneur starting a new business (and explain why. for each issue)? L the TEN challenges in order of priority and place an importance factor on each challenge (a number 0-100, with 100 signifying an enormously important challenge) Many students argue that it depends on the type of venture, and if you believe this to be true, then select a specific type of venture, identify it, and answer the question. Same as question #1 except regarding the MANAGING of a new venture.
Expert Answer
Top 10 challenges and the reason for each one are:
- Difficult to find the right Set of people: Because they are ones who will actually drive the start-up and not many of them are willing to work for a small firm.
- Correct Estimation of Break-even point: Because the costing depends on that and an incorrect estimate might result in loss of good amount of money.
- Convincing the Investor: It is a challenge because it is very difficult to convince somebody to spend money on your idea having a very uncertain future.
- Advertising: Not many know the art of advertising and often end up spending money which results in no gain.
- Execution of the plan: many start-ups do make plans but correct execution is not always there and because of this start-ups fail.
- Government Policies: Tough government rules and regulations sometimes pose a challenge in front of start-ups to comply and abide by all the mentioned rules and regulations of conducting a business
- Difficulty in Globalization: Different countries have different business rules and different taxation policy, for a new organization it is tough to agree to each and every condition of each and every country.
- Internal Conflicts: These results in dilution of the team who actually initiated the start-up.
- Tough competition: It poses a challenge as the organization cannot cut down the costs and if the costs are not below par then their product would not sell initially.
- Decision making and managing finances: It is also a major challenge as consensus is often not made and to manage the expenses is sometimes a very big task which many start-ups could not do efficiently.
