Why do startups fail?
Half of the UK‘s entrepreneurial ventures fail to make it past 5 years, and more than half in the US. That’s a scary figure, particularly if you’re thinking about embarking on your own startup adventure. What are the reasons these startups are failing and can you avoid the same fate?
Technorian have compiled their below infographic based on their excellent study: Startup Ideas – 56 Reasons why businesses fail (The Ultimate Guide to Avoid Failure). They also went to some of the most brilliant business minds to understand how to avoid the identified pitfalls and give your startup the best chance for success.
As part of the study, they realised that the 56 most common reasons that companies fail can be divided into 9 categories. These are as follows:
- Human Resource Management
- Product Launch
- Marketing Sales
- Operations Management
It’s essential to keep the above areas in mind when thinking about your own venture. Have you set up realistic plans focussing on them all? It’s all well and good being worried about financials, but that’s only one category out of 9, as to why startups fail.
For example, how much thought have you given to leadership structures and even your own leadership skills? It can all get lost in the hectic pace of a startup but great leadership takes careful honing and it can be a worry when you’re hiring new people for your company. How are they going to affect your business?
Take a read through the infographic below and take in the advice from market leading experts. Make sure you’re prepared for the worst in all of these areas and you’re setting yourself up for the best chance of success!