10 reasons why so many startups fail, according to startup founders
Why do so many startups fail?
To help you better understand the ways startups can fail, we’ve asked this question to entrepreneurs and business leaders. From lack of specialist knowledge to resistance to change, startups can fail in a number of ways. Read here to learn more about how your startup can avoid failure.
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Here are 10 reasons startups can fail and ways to avoid those missteps:
- Be ready to rotate
- The good moment
- Be a real expert
- Determine the needs of your market
- Develop a presence on social networks
- Follow an established pattern
- Plan and stay adaptable
- Stay passionate about your startup
- Make a convincing valuable accessory
- Be thoroughly
Be ready to rotate
One of the common reasons a startup fails is when leadership resists change and the need to pivot. As an eyelash extension supplier, I had to change my business model during the pandemic. It was around this time that I started my eyelash extension online training courses. This strategy not only generated additional revenue, but it also created a new kind of customer journey in my business that made my students loyal brand ambassadors.
Vanessa Molica, The eyelash professional
The good moment
So many startups fail because of timing. Curricula’s founding story has been slower than most startups, and that’s good for me because we took our time to make sure everything was going well. It was an honest journey fueled by hard work and the focus desired to change the norm. I can’t describe how excited I get every time we sign a new client because it’s a new opportunity to protect another organization. We clearly have an echo in the cybersecurity industry which is in desperate need of change. We know we’re on to something really important now.
Nick Santora, Programs
Be a real expert
I believe that many startups fail because the founders and the management team were not true experts in their fields. Many entrepreneurs learn to look for ‘gaps’ in the market, regardless of that market, but the problem here is that without a solid enough understanding of the industry, you cannot accurately diagnose a gap or create a product or service. to answer them perfectly. The best advice I can give you is that if you want to enter a new market you have to be the best at it – otherwise you are doomed to failure.
Brett Farmiloé, Markers
Determine the needs of your market
One of the causes of startup failure is a lack of research. It is crucial that you know what your customers want. It’s easy to enter the market thinking you have a great service or product to offer, but you have to remember that there has to be a need. With that said, do extensive research in your market to find out how to meet the needs of your potential customers.
Derin Oyekan, Paper reel
Develop a presence on social networks
I designed, planned and launched my business during the COVID-19 pandemic alongside my business partner as we both worked remotely. Startups generally fail because they lack the money to fund themselves. We have developed a loyal consumer base through social media outreach, with over 300 interested buyers signing up to our pre-launch mailing list. Broadcasting on social media is a free marketing strategy that businesses can develop so that the funding doesn’t go over the marketing budget.
Ashwinn Krishnaswamy, Oklahoma smokes
Follow an established pattern
Many startups fail because they attempt to enter competitive markets on the assumption that disrupting an industry will automatically mean dominating it. Aiming to be an industry’s new “Uber” is no guarantee of success. Completely changing consumer habits is harder than it looks, and reinventing business systems from the bottom up is time consuming and expensive.
Not all businesses need to be revolutionary to be successful. There is no shame in following an established business model and changing steadily or offering a high quality, yet world-changing, product or service. A modest success is always a success. Better to profit from a simple and straightforward idea than to go bankrupt on the moon.
Michel Alexis, Team building
Plan and stay adaptable
Many startups fail because they miscalculate their projections initially using a model, don’t make a plan to begin with, or don’t scale well. Generally, these three issues can be detrimental to a new startup. When you have a viable business model, you need to execute it accordingly and have the resources to achieve your goal.
Overestimating your profits and not allowing time for things to take off can leave you with scarce resources in the end. Others fail because they can’t handle the constant stream of ups and downs even after successfully overcoming market challenges. The market is constantly changing, adaptability is essential, and businesses that allow room for adjustment and openness will eventually be successful.
Brandon Werber, Airvet
Stay passionate about your startup
Startup founders and their teams really need to care about the importance of the product or service and how it can add value to people’s lives. They also have to put a lot of effort into finding ways to connect with their customers. If money is the only goal and the owner doesn’t feel a sense of connection with invaluable meaning behind the startup, it may become obvious to others. If customers feel a sense of dishonesty from a startup owner, it will leave a permanent negative impression.
Mike Pasley, Famous IRL
Make a convincing valuable accessory
One of the main reasons startups fail is due to marketing issues. There isn’t a compelling enough value proposition or compelling event to get the buyer to actually commit to buying. It could also be that the market timing is wrong and you are either too far into the future or stuck in the past.
Guy Bar, Hyfit
Running a startup takes a lot of time and dedication. Entrepreneurs who run startups need to be thorough; in fact, many start-up businesses fail due to a lack of time devoted to the business. Another reason startups fail is that they give up too quickly. The truth is, not every trial or business failure should be viewed as a complete downside. A savvy entrepreneur will choose to learn from these experiences and refine their business strategies in the future.
Marie Berry, Cosmos Vita