5 Reasons why startups fail
Only 10% of startups succeed which means that 90% of them are going to fail. So why is it that difficult to build a startup? Throughout my journey at Health at Home, I got the opportunity to dive into the startup ecosystem that gets me listing down the various problems that startups face and if nothing is done, they are most likely to fail.
1. Too much hard work. Many of them do not payoff
Many of the things that you are going to try out will not bear any fruit. You are going to try out different prototyping, business modeling, customer acquisition method, etc. When these plans fail, you got to redo and try different things. Most importantly is not to give up. Giving up is the express ticket to startup failure.
2. Most of the first people who hear you are going to reject you.
The first potential customer that you sell to may be skeptical of your business because nobody has ever used it. The first investor that you pitch to may not have the confidence to invest in you because of several reasons; whether your product does not seem right for the market, your product is too unique that it is for a new market segment that never exists or maybe it is just a bad idea? Perhaps both your sales and investor pitch are too complex to understand for these people to buy or invest in your startup.
3. Nothing is prepared for you
Nothing is prepared for you unless you work for it. When you want to build any platform, you have got to go through all the chores of design, programming, business planning, processes and operations. Nobody loves to write long-winded terms and conditions. No individual in the right mind enjoys building FAQs content on their business. All the factors that I described above are important pieces of the business that startup founders should not neglect.
4. Hard to align the early employees with the company
Hiring is probably one of the toughest processes of building a company. Startup founders want or I say need to hire the right people. Luring individuals with competitive salaries are not enough. A startup is not able to appease everyone with fancy employee benefits that big companies can offer. Startups need people who not only love the company, they need to love what they are doing. That is what motivates these individuals to come to work each day and grow with the company. Having people to come and go every few months will disrupt the operations and growth of the company. So, hiring is super IMPORTANT!
5. Got to handle tons of surprises
There are many external factors that are beyond the control of the startup. Building a startup from scratch is already so much work. The situation gets worse when the economy becomes unfavorable or new regulation kicks in that affects the business. Startup founders have to always be on their toes all the time, be able to learn, adapt and react to the obstacles that they face.
To sum up this write up for aspiring startup founders out there, the startup scene goes beyond the glamour of pitching for fund-raisings. Operating the startup, managing customers’ expectations, improving the product, nurturing employees and being adaptable are the aspects that many startups neglect which caused them to fail in every part of the business one by one. When you see that your company is facing such a problem, try to improve the situation before it gets worse. Thank you for reading!