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3 Major Reasons Why 90% Of the Startups Fail Despite Having Great Ideas
There is no single path which guarantees success and on the other way, all the paths need not necessarily lead to failures. Success or failure – it lies in one’s sheer determination and passion. Among these failed startups, did you ever imagine how many of them had great ideas?
Well, yes, almost half of these failed startups had great ideas. Most of them had already accepted the fact that they had great ideas to start with, it just didn’t work out. Having a clever idea is just not enough to have a successful business. Great timing, intelligence and a hardworking team and a pinch of luck decide whether your business will stay for long or just collapse.
Here, we share the major reasons why most startups fail besides having great ideas.
1) When your idea lacks to serve the market need.
This is one of the major reasons why startups fail, most entrepreneurs have a brilliant idea to start off with, but it solves a problem which people don’t have at all. The market timing may be wrong. Your product could be ahead of the market by many years and your customers feel that they don’t need your product at that particular stage.
A careful survey of failed startups has determined that 42% of them have the product that the market no longer wants.
Solution: If you spend ample amount of time researching about your product, then have the same amount of time for analyzing whether your product is the right one for the right market.
2) When you run out of cash
This accounts for the second major reason for the failure of startups. Almost 29% of the startups fail because they run out of cash. Being your company’s founder you should understand how much money is left and whether that will carry your company to a milestone that could lead to successful financing.
Solution: Plan for the growth and the related cash outlays well in advance so that they do not come in as a surprise to you. Track your cash flow results every month to determine if your management is creating the type of cash flow your business needs.
3) When you are not surrounded by the right team
Good teams are formed when like-minded individuals with a common taste, preference, and attitude come together and work together for a common goal.
A popular American industrialist Henry Ford once said: “Coming together is a beginning, keeping together is progress and working together is a success.”
This statement of Henry Ford can very well highlight the importance of teamwork in the business.
A single discouraging team member can put your business at risk.
Solution: Choose your teammates wisely. Create a healthy competition among your teammates so that ultimately it is your organization which tastes success.
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