Why some startups fail?

  • 10th Sep'20
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Startups grow very quickly however they also fail very often. Most of the business owners think that they will create a really great product but only an idea cannot ensure an effective and successful project realization. Did you wonder what number of new startups fail? Unfortunately, according to Startup Genome Report Extra, 90% of startups fail.

Below we will discuss common challenges for the new startup entrepreneurs and how consulting solutions for IT startups can assist to avoid them.

 

Challenges for Entrepreneurs

 

There are a few common challenges for entrepreneurs:

1. Lack of budget - Startups need to make sure of how to secure the investment. Sometimes it’s not a matter of how great your idea or thought is – without investments all businesses can come to a failure. Thus, you need to make a working Proof of Concept (PoC) or possibly a decent strategy to introduce it to investors.

2. Focus on creating a product without a focus on customers - The entrepreneur directs all his eagerness on the product building process and doesn’t check the input and consider about end-users. This resembles the following stages: a founder has a thought and builds the solution; founder attempts to sell a product; product is not purchased; entrepreneur loses cash; and at the end startup dies.

You should focus on the end-clients demands and take account of their opinion. Additionally, you should discover your intended target audience and focus on their input.

3. Scalability - Startups are developing quickly. This is a worry for both the business and the team. Quick growth needs high scalability or adaptability. Practically, you need to employ new individuals, expand the in-house team, prepare new work environments, rent a bigger office – it’s laborious and at times hard to execute. What’s the solution? You might hire a remote team or an MSP. Thus, you will have qualified employees without growing the in-house team.

 

How to avoid the failure of a startup?

 

Startups are facing a limited budget and absence of implementation strategy. Indeed, even the ideal thought needs a technical foundation, hence entrepreneurs in every case need a very much experienced team. In this situation, referring to the MSP or hiring a dedicated development team might be a solution. You will get experienced specialists without hiring them in-house. 

Fortunately, these days working with remote teams is not a problem. MSP can provide you with the technical foundation you need. You can receive Proof of Concept for your future investors, MVP for your future clients and, sometimes, an End-to-End development for product release and progressing scaling. Thus, you will have a solid implementation of your idea and also the support of experienced MSP.

Sources/References:

*Note: The content published above was made in collaboration with our members.

About the author:

Nikhil Jacob, OpenGrowth Content Team

Nikhil is a Content Marketer by Profession. He has recently launched his content house where he offer Content solutions to all the industries, bloggers, startups, agencies, and brands to skyrocket their content marketing campaign.


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