In today’s world there are many entrepreneurs coming from different walks of life with good ideas, who have set up their own businesses and dare to dream. However, having a successful startup involves a lot more than simple courage and it is there where most entrepreneurs fail to meet the required criteria.
“Don’t worry about failure; you only have to be right once.” - Drew Houston
The following points can act as your guide helping you navigate your journey as an entrepreneur.
1. Concept/product lacks a purpose
“Chase the vision, not the money; the money will end up following you.” - Tony Hsieh, CEO Zappos.
Before launching a business, market research is extremely important. Remember, your product might not be completely new, but it has to offer something through its features which were lacking in everything else that was present in the market till now. Knowing your competitors, their products, their weaknesses - thus helps you in creating a USP for your own product.
2. No proper business plan
Having a full-fledged business plan is a prerequisite of starting a business in today’s world. A regular plan will include lists of short term as well as long term goals, a SWOT analysis, your potential markets, target audience, market penetration, market strategies, detailing of finances, organizational hierarchies and customer feedback. All these features of a business plan help you navigate your business journey in the future, and not having this navigator to guide you through might make it difficult to survive. Don’t know how to develop a Business Plan? Read the notes below.
3. Lack of talent attraction and retention
Your company is only as good as people who work in it. Attracting talented people and making them stay on board throughout the course of your journey is a difficult task, and one, which needs all the leadership skills one can acquire. You need to put together a talented team and keep it together, even if it is a small one. It might involve making some hard decisions, and many times, this is where entrepreneurs give up.
4. Not future proof and scalable
In today’s age and the world, technology is the keyword. Your business needs to be future centric as well as scalable. These two things decide the fate of your idea in the coming years. Sometimes an idea works well in a small, incubatory sample, however, it does not take well to large sample sizes, which is something you need to figure out before taking your business big.
5. Poor financial planning and execution
When you are new in the field, you are expected to spend money on different things, however, the keyword is significance. You need to plan your expenditure as per your company’s priorities and stick to the plan. This requires being good with money and a little bit of financial intelligence. As a general rule, make sure all your expenses are towards the growth of the company and avoid luxury spending.
6. Lack of perseverance
Probably the most important of business skills is to be perseverant - to keep at it even when the going gets tough. However, it is important to learn from your failures. When you have established that something does not work, keep your ego aside and change the course for the betterment of the business. Similarly, do not let failures get to you too easily.
Thus, a failed startup is by no means an indication of never trying again. It all boils down to learning from your past mistakes and doing it better the next time until you finally succeed!
So, these are some of the reasons why Startups fail. Give me your thoughts and maybe other reasons that you believe lead to the demise of new companies.
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