#20 Reasons why Startups fail

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When you choose a life of an entrepreneur, you have signed up for a life full of challenges. Chances are you will fail much more times than you expected. Even so, shying away from attempting, solely for the fear of failure would be the ultimate loss of all.

As necessary it is to know the mantra of success; it is equally important to know what the primary red alerts are in the brave world of entrepreneurship.

CB Insights, a tech market intelligence platform released a report this year that discussed the top 20 reasons why startups fail. The report candidly mentioned that in their research, they found out that there is no one particular reason behind the failure of any startup. Besides, the reasons were far and varied. However, they sifted and consolidated the data to come up with some solid conclusions.

Top 20 reasons behind Startup failure

#1 No Market Need – Creating a product that may be revolutionary, but is not solving a need that is dire and so people do not want to pay for it.

#2 Ran out of Cash – Obviously, you need oxygen to survive.

#3 Not the right Team – Team is the spine of every organization, and if the teammates are not compatible with each other, the project is sure to doom.

#4 Get Outcompeted – Never forget there are others in the race too. Non-performance is not accepted anywhere.

#5 Pricing/Cost Issue – Solving a need is good, but, it will make sense when you can do this at a profit.

#6 A User-unfriendly product – Would anyone like to buy a solution that turns out to be a challenge indeed. Keep it simple is the rule to adhere.

#7 No Business Model – Creating a product without finding out who the target audience is and how to approach them is quirky.

#8 Poor Marketing – No matter how good the product is, its credibility will be proved only when it is used. A marketing strategy is crucial.

#9 Ignore Customers – Not paying heed to customer’s requirement is not a mistake but a crime.

#10 Product Mis-timed – Developing a product way too ahead of its time, when the market is not ready to validate it, can cause all your efforts to go in vain.

#11 Lose Focus – Your startup is no less than your baby. It demands your 100% focus.

#12 Disharmony in team/investors – Stressful environment in the workplace could be very detrimental.

#13 Pivot gone bad – When the central idea/logic behind your concept is wronged, there is no point in going ahead anymore.

#14 Lack Passion – Bootcamping is a cumbersome process. You might just get too tired to feel passionate enough.

#15 Bad location – This happens way too often and brings other unwanted overheads in the picture.

#16 No Financing/Investor interest – Suddenly the investors lose interest in your product, and you have no choice but to shut your shop

#17 Legal Challenges – There could be copyright or intellectual property issues. Also government approvals, permissions, etc. turn out to be a tough nut to crack.

#18 Don’t use network/advisors – Make the optimum use of all your connections. Take guidance when you are not sure.

#19 Burn-out – Your baby is going to keep you on toes. You might just burn out all your energy to continue.

#20 Failure to Pivot – Not pivoting away fast and sticking to a wrong decision or wrong hire can turn out to be expensive



This article is written by the Crowdfunders Editorial Team. In Asia, Crowdfunders.Asia is a leading portal on providing news related to crowdfunding, start-up, property and business. It is operated byCoAssets.com. CoAssets is South East Asia’s first listed and largest real estate crowdfunding platform. If you have any Crowdfunding news or stories to share, please [email protected]


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