You can change the world if you think you are crazy enough to do so.
By its definition, a startup is a young organization established by at least one business visionary to build up a product or service and put it up for sale to the public. A typical startup tends to run on a tight budget, with initial funding from the founders or their friends and families. Needless to say, it’s a path not everyone chooses to be – changing business models, funding problems, staffing and compensation. In the beginning stages, new businesses have next to zero income coming in. As if these weren’t enough, at any of these stages, they fail.
Let’s look at the most common reasons of failure of startups:
Customers – According to CB Insights, 42% of startups fail because they didn’t solve a market need. In other words, there was no customer. Your one and only goal is not that of selling your product/service but to solve a meaningful problem for other people. The most important thing is to make your customer’s life easy by solving their biggest struggles, challenges and frustrations. Something pleasant to-have won’t lead a major business. Mobile phones market their products as the solution to communication needs and not as a technology device.
People/Culture – Having the right people on board is just as important as building the right product/service. After all, a company is as good as the people in it. It is important to have a decent number of people on board, at least one from every function so that there is a combination of people that covers the holy startup triangle: hipster, hacker, hustler (aka designer, engineer, marketeer.) Culture in startups needs to have open communication, creative problem-solving and flat hierarchy.
Funding – Or lack thereof. Many startups find a tough time to look for investors who are ready to invest in their idea. Fundraising in a startup environment is something that needs at least half a year of active prospecting, meetings, calls and visits. The more you are in the daily schedule of raising support, the more exact you are about what you need as an organization and what speculators who are searching for your profile need.
Lack of skills needed for the business – Many founders can’t do what is needed for a business to take off on their own. It is recommended that they should concentrate in industries that value their skills and educational background, besides their professional expertise. On the off chance that you or your co-founders lack the skills or abilities needed to get your company going, be sure to identify those needs early on and read, study, learn and experience theoretical and practical knowledge that can give you the upper hand and prevent your company from crashing.
Do any of these problems resonate with you? Schedule a call with us to understand how a business coach can help your business thrive.