Fri 12 May 2017 11:05

Why Startups Fail: The Most Common Mistakes

A huge number of new ideas that lead to creation of new businesses appear in the world yearly, monthly, weekly and even daily. A very large part of these ideas becomes a basis for creation of startups.

There are really a lot of them – today startup it is one of the main trends of the modern business world. But there is some of the poison in the honey: according to statistical studies of various companies, 80 to 90% of startups fail. Business experts say that the majority of founders of new companies and products make very similar mistakes. And if you manage to avoid these mistakes, your startup will have a much greater chance of success than products of your competitors. So, what is wrong?

Only you like it

Every creator of a new service or a product, of course, loves it. The majority of  the experts in the field of business relations and development think that this love can lead to a number of incorrect decisions. First, assuming the product as a great one, developers are often unable to assess objectively how that product or service is being demanded in the market. The common thought is: "What's wrong with them?", and if you have such a thought, check if you are doing everything right. Sometimes the price is too high because you evaluate your product by yourself as a good and competitive (the reality may vary of this thought). Sometimes people don't need or want this product and service in this type and style, in this way of work etc. It is very important to understand this moment as soon as possible – the more you spend on it the more disappointing result you'll have. If you create a startup and all your efforts don't work in 12 months, it is better to choose your plan.

PodioBox: How to Run a Perfect Startup Pitching Contest

You do it by yourself

When you check out any of the startup-questionnaires you can find online, there is a high possibility that you see a question like "how many founders does your startup have?". It is very difficult to create and successfully sell the startup that has only one founder and only one person who does everything by himself. Of course, there are exceptions, but there is a very small number of them. Investors are much more willing to give their money for new startups if they find out that they were found by several people and there is a team working with it. If you already have a team, there is another problem – you don't want (or don't know how) to delegate some part of work to other people. You want to control everything and think that you can do it all better than others. But if you want your startup to develop, you should delegate – or you will bury yourself under tons of impossible tasks.

Is Your Business A Startup?

You think they should buy it now

Don't underestimate time. Young and ambitious startup leaders may think that they can sell their product or service very fast – we've made a great thing, why no one wants to invest money in it? But if we talk about reality, it is reasonable to know that a sale process may take months and sometimes even years. You should plan your business project remembering about this fact. If you really plan to sell it in two months, you may appear in a serious trouble with money and employees in the beginning on the third month from the start. Every sales process has its life circle and has several stairs you should climb. Especially if you are trying to sell your startup to a big investor which has several managers, top-managers, HRs and other staff that you should talk before you have a possibility to meet him.

You spend too little or too much

Since most startups are funded by their owners and business partners, and often also by their friends and relatives, money is a very serious issue. There are two opposing errors. The first is to spend too much, and the second is to spend too little on the development of your project. In the first case you risk to overestimate your product and efforts. You invest huge sums in large-scale advertising, hire a great team, pay big money for all this expecting the investor will pay it back. But in reality even a very interesting project may not suit the investor and the public - and nothing happens. You will lose money. In the second case, trying to do everything independently and at a very low amount, refusing the services of professionals, not paying for any advertising, you also risk - no one will know about you, your product won't look serious (for example, if it doesn't have a website or a well-made presentation). Make small steps – check out your real money and compare it to your expectations.

You think small

The biggest mistake a startup can make – is to think small. If you don't believe in your product, in the success of your service, in the professionalism of your team and yourself, in the probability that the investor will give money for your work, the chances to fail are significantly increased. You will not be able to avoid competition. You will not be able to refuse risk. There is no guarantee that you will not fail. But there is one guarantee of absolute failure – it's 100% if you are not going to do anything. If you are constantly afraid to fail - you fail. Practice positive thinking, reinforce positive and high-quality work, go ahead, develop the necessary communications. 

Don't try to work perfect – just work hard. And nothing will stop you on the way to your success. 

Good luck!

© Assiomatica SA

Why Startups Fail: The Most Common Mistakes

Why Startups Fail: The Most Common Mistakes

Posted on 2017-May-12

There are really a lot of them – today startup it is one of the main trends of the modern business world. But there is some of the poison in the honey: according to statistical studies of various companies, 80 to 90% of startups fail. Business experts say that the majority of founders of new companies and products make very similar mistakes. And if you manage to avoid these mistakes, your startup will have a much greater chance of success than products of your competitors. So, what is wrong?

Only you like it

Every creator of a new service or a product, of course, loves it. The majority of  the experts in the field of business relations and development think that this love can lead to a number of incorrect decisions. First, assuming the product as a great one, developers are often unable to assess objectively how that product or service is being demanded in the market. The common thought is: "What's wrong with them?", and if you have such a thought, check if you are doing everything right. Sometimes the price is too high because you evaluate your product by yourself as a good and competitive (the reality may vary of this thought). Sometimes people don't need or want this product and service in this type and style, in this way of work etc. It is very important to understand this moment as soon as possible – the more you spend on it the more disappointing result you'll have. If you create a startup and all your efforts don't work in 12 months, it is better to choose your plan.

PodioBox: How to Run a Perfect Startup Pitching Contest

You do it by yourself

When you check out any of the startup-questionnaires you can find online, there is a high possibility that you see a question like "how many founders does your startup have?". It is very difficult to create and successfully sell the startup that has only one founder and only one person who does everything by himself. Of course, there are exceptions, but there is a very small number of them. Investors are much more willing to give their money for new startups if they find out that they were found by several people and there is a team working with it. If you already have a team, there is another problem – you don't want (or don't know how) to delegate some part of work to other people. You want to control everything and think that you can do it all better than others. But if you want your startup to develop, you should delegate – or you will bury yourself under tons of impossible tasks.

Is Your Business A Startup?

You think they should buy it now

Don't underestimate time. Young and ambitious startup leaders may think that they can sell their product or service very fast – we've made a great thing, why no one wants to invest money in it? But if we talk about reality, it is reasonable to know that a sale process may take months and sometimes even years. You should plan your business project remembering about this fact. If you really plan to sell it in two months, you may appear in a serious trouble with money and employees in the beginning on the third month from the start. Every sales process has its life circle and has several stairs you should climb. Especially if you are trying to sell your startup to a big investor which has several managers, top-managers, HRs and other staff that you should talk before you have a possibility to meet him.

You spend too little or too much

Since most startups are funded by their owners and business partners, and often also by their friends and relatives, money is a very serious issue. There are two opposing errors. The first is to spend too much, and the second is to spend too little on the development of your project. In the first case you risk to overestimate your product and efforts. You invest huge sums in large-scale advertising, hire a great team, pay big money for all this expecting the investor will pay it back. But in reality even a very interesting project may not suit the investor and the public - and nothing happens. You will lose money. In the second case, trying to do everything independently and at a very low amount, refusing the services of professionals, not paying for any advertising, you also risk - no one will know about you, your product won't look serious (for example, if it doesn't have a website or a well-made presentation). Make small steps – check out your real money and compare it to your expectations.

You think small

The biggest mistake a startup can make – is to think small. If you don't believe in your product, in the success of your service, in the professionalism of your team and yourself, in the probability that the investor will give money for your work, the chances to fail are significantly increased. You will not be able to avoid competition. You will not be able to refuse risk. There is no guarantee that you will not fail. But there is one guarantee of absolute failure – it's 100% if you are not going to do anything. If you are constantly afraid to fail - you fail. Practice positive thinking, reinforce positive and high-quality work, go ahead, develop the necessary communications. 

Don't try to work perfect – just work hard. And nothing will stop you on the way to your success. 

Good luck!

© Assiomatica SA