6 failure causes.
Starting a business is harder than it seems
The majority of startups is bound to fail. This is due to the high risks and loads of factors they have to consider. That’s why, it’s necessary to be aware of others’ mistakes in order to avoid them and increase your chances. If you haven’t read the examples of failed startups or the first part, be sure to check them out!
1. The Lack Of Business Model 17% startups encounter this problem. The founders of failure projects consider a business model critical. If a company has only one channel, investors are not likely to invest in it. The only one income source may even ruin the startup. Therefore, it’s better to integrate several sources in order to be more reliable.
2. Weak Marketing This factors is also frequently underestimated by project founders. It’s very important to understand your audience, be able to interest them, and turn into your clients. Many founders, particularly, if they like creating a product, allocate little time for its promotion. It’s a crucial mistake, though. If no one knows about your product, it doesn’t matter how revolutionary it is. 14% failures resulted from poor marketing.
3. Ignoring The Client One more easy way to fail the project is not listening to users’ reviews. Many startups either don’t collect them or simply ignore. No matter if the product seems the best to its creators. It’s important that your customers think so. A company has to consider clients’ opinion and adapt to their needs.
4. Untimely Product Release There are two extremes — a product can be released too early or too late. In the first case, the solution may be not fully prepared. However, the team craving to outpace the competitors launches the product to the market. Eventually, users are not satisfied with the bad quality. Returning disappointed clients is very hard. On the contrary, there are companies that strive to refine the product as much as possible. In the end, they can lose time and the opportunity to gain a firm foothold in the market.
5. Focus Lose It was included in 13% failure cases. The founders often switch into other projects or personal issues. In this case, neither brand new idea nor good funding will help you. In order to reach success, the founders have to be maximally concentrated on the startup.
6. Disagreement With The Team or Investors
Even though the creators possess necessary skills to launch MVP, the startup may fail. One of the causes is disagreements inside the team. It can concern the role distribution, running the business, or developing the product. The same problem can be with investors. They can act differently. Some of them hardly interfere in the startup development. Whereas others control every single step and persuade you to make a certain decision. Disagreements are the failure cause in 13% cases.
Which cause do you consider the crucial one?
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