With the growing rate of unemployment, people have been clamouring for the youths to stop seeking jobs and start creating them.
Let’s start with what a startup mean.
A startup is a company designed for rapid growth.
Statistics shows that about 80% of startups end up failing in the first five years of existence. Are you fretting about your own startup?Don’t worry amazons clique has got you covered. We have compiled 13 reasons why companies designed for rapid growth end up failing in their first five years of existence. These reasons includes:
1. Lack of market: The excitement of creating a startup makes a lot of startup owner dismiss the need to identify the market for the goods and services their startup will be providing. A startup without a targeted market eventually fails because there will be no cash flow to keep the startup running.
Is there really need for what your startup is offering???
2. Inappropriate marketing strategy: Marketing helps the startup to sell itself to its target audience. The power of marketing in the growth of a startup can not be underestimated. Startups spend a lot on marketing strategies without thinking about the efficacy of the strategy they are investing so much money and time on.
“Marketing without data is like driving with your eyes closed.” – Dan Zarrella
3. Disregarding consumers opinions: A startup that wants to be successful is tailored towards providing value to a particular set of people. A lot of startups that have failed has done so because they disregarded what the consumer of their good and service have to say and offer.
“Whoever understands the customer best, wins.”- Mike Gospe
4. Location: A lot of startups have failed because they disregarded the power of their location in their growth. Siting a startup in an environment that is not accessible, marketable and does not offer any value to the surrounding people is a recipe for major failure.
5. The wrong team: Startups that are sailing with the wrong team is heading for disaster. Every business heading for success should be founded with the right team to have all the skills needed to move the company forward.
Are you sure your startup has everything you need? You have to have all the right skills in the right proportion.
6. Funding: Startups fold up as a result of funding. Every startup incur overhead running cost that the new startup can not afford in the beginning. At this junction if the startup team cannot source for additional funding that the startup would crash in no time.
7. Underestimating competition: Although your startup needs to do things in a very unique manner however, turning a blind eye to how your competitors seem to be doing better than you are leaves you behind in your world of ideas.
“Competition is always a good thing. It forces us to do our best. A monopoly renders people complacent and satisfied with mediocrity. “-Nancy Pearcey
8. Fixing prices: Startups fail when there is no balance between the price of goods and services and the quality of good and service offered. Some startups are focused on the money they would receive and they forget that quality should precede the want for money. Asking for too much money for substandard service is fraud and asking for too little money may indicate that you are not sure of what you are offering.
9. Losing sight of purpose: Startups fail because they are not true or consistent to their statement of purpose. When a startup is on its growing stage a decline from what the startup has to offer could lead to a downturn of growth.
10. Lack of passion: Starting a startup you are not passionate about is doomed to fail. The success of a startup dies not happen over night, it takes hard work and persistence. The only thing that can keep you moving till your startup becomes a success is your passion for it.
“If you’re passionate about something and you work hard, then I think you will be successful.” —Pierre Omidyar
11. Legalities: The legalities associated with a startup can be the cause of its failure. These could become a cause for failure when the startup begin to spend money and time that could be better spent towards the startup running cost on sorting the legalities surrounding the legalities on the startup development.
12. Forgetting your network: As a startup owner your network are your friends, family and every body you know. How do you want your startup to succeed if you are unwilling to ask and accept help from your network?
Your network is your networth
13. Burn out: Startup owners in the quest to grow their startup put in their all and forget their selves in the process. Startup owner tend to relax at a point which causes a decline in growth and ultimately leads to failure.