Strong founders are a good start when starting a small business
Recent reports from the HSBC Global Small Business Confidence Monitor suggest a strong investment outlook for SMEs over the next few months. This might mean that it's a good time for Canadians entrepreneurs to consider business formation.
Still, a weak founding team is one of the leading causes of failure for new companies, and it could turn investors away, according to Business Insider.
Startup expert Simeon Simeonov told Venture Hacks that entrepreneurs often make the mistake of bringing in too many founders because they find individuals who meet the specific goals of their original business plans.
This is linked to another common mistake of entrepreneurs: maintaining an arrogant belief that their initial business plans will be a recipe for success.
Small- and medium-sized enterprises' agendas will likely evolve as entrepreneurs continue the incorporation process. Thus, co-founders who fill a specific niche might be rendered useless.
To avoid this problem, Simeonov suggests that entrepreneurs start by bringing in partners with general experience and hold off on hiring specialists.
Building a strong founding team could help future SME owners bring in investor's funds and maybe save some of their own. According to the HSBC Global Small Business Confidence Monitor, 59 percent of Canadian SME owners say they will invest in their own companies this year.
