A common mistake made by startups is launching a company in an industry in which the founders know little or nothing about.

I find this happens often in the healthcare and financial industries.

The size and growth of those markets make it attractive to pursue but without a deep knowledge of how those industries work, is a recipe for disaster.

The first issue is regulatory. Both industries are highly regulated and impacts greatly what you can and cannot do.

The second issue is the current company landscape – a basic understanding of who does what in the industry is important.

The third issue is your contacts working in the space.  Who do you know that can help you as a customer, advisor, or employee? This becomes particularly important when you go to sell your product.

Before launching in a new industry, make sure you know the regulatory landscape and how it impacts your startup.

Build a network in the industry of partners and other contacts who can help you.

Finally, build a core group of people who can help you build or advise your startup.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

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Thank you for joining your host Hall T. Martin with the Startup Funding Espresso — your daily shot of startup funding and investing.

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Disclaimer:
Hall T Martin is the director of Investor Connect, which is a 501(c)(3) nonprofit dedicated to the education of investors for early-stage funding. All opinions expressed by Hall and podcast guests are solely their own opinions and do not reflect the opinion of Investor Connect. This podcast is for informational purposes only and should not be relied upon for the basis of investment decisions.