Top 10 reasons: why do startup fails?

Top 10 reasons: why do startup fails?

“Success is often achieved by those who don’t know that failure is inevitable.” – Coco Chanel

A startup company is an entrepreneurial venture who designed to deliver a new product or service under conditions of extreme uncertainty. Startup basically grow very fast and capture a large market. It is a company working to solve a problem where the solution is not obvious and success is not guaranteed. They face many problems to get success in market . Their are top 10 reasons that startup face failure: 

No market need: This is a top main reason to startup fails: no market need startups should identify the problem of society. The report found out that almost 42 percent cases failed because they were solving interesting problem, but not one which the market needed. They didn’t resolve an important problem the marketing was facing. Therefore, it is important that startups to understand the market needs and get an idea to resolve the problem.

Run out of cash: This is a another most important reason why startup fails. Due to fund crunch almost 29 percent startups are facing failure.they failed to raise fundings or initial investment that supposed to poor planning or allocation of resources based on the startups requirement.

Not being able to build the Right team: A good team can make or Break a startup. Their are 23percent startups who are failed because of the poor teaming this lead to product failure. Running a team has so much complex than a single- person project. So, the startup has to build a good team to give their best for the product.

Failing to pivot/ change direction: The startups are getting attached to their first/intial product , despite of knowing that they are building a wrong product, not able to pivot. This leads to wastage of time, money and resources too. Eventually it leading to failure.
So, their should be have backup plans for their product.

Lack of persistence: If the startup person does not have a strong passion for their product they will not able to persist through the bad times. Lack of faith often leads to discontinuity of the product, which leads to startup failure.

Bad location: The startup being failed to find right location to place their talent and idea. They are not able to get a clear image of suitable location to promote their product. The right place will target the customers most likely to use the startups product.

Not able to monetise, become profitable or innovative to beat competition: Their are several type of startups who have worked out but are still unable to either monetise or reach a profit mode.their investors, who look for profitability and growth. they started becoming restless and these entrepreneurs found it difficult to meet those expectations. So, the startup need to constantly re-innovative and they need to be on their toes to figure what next in order to be ahead of the competition.

Legal challengers: Every startup have to face legal challenges to prompt their product in a market. Unexpected legal issues may arise when startup starts growing into different markets.

Unaware of competitors and changing market conditions: Every startup have figured out everything for product and it helps him to kick off the startup for a sustainable long run business. But there is one more thing which should be addressed regularly and carefully, and that is market condition and competitor’s current performance.startup blindly follow their passion for their product and forget to address these aspect of business so, they have to do good market study along with competitor analysis. It will help startups for their growth by providing product and services.

No guides or consultants: it is great to have a mentor for your startup. Going alone without any guidance will odds you to commit errors that may lead to failure. Experienced coaches can help you in your everyday choices to abstain from tumbling off the bluff.


Author: K Devika

About Author: I believe in my self and I have a faith in my abilities. I have to let people see what I wrote. It will never be perfect, but perfect is overrated.

Pursuing B Com (Hons.)