Why Startups Fail ?


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A number of startups come up each year. After a year in operation, only a few of them survive. In this article, we take a look at some of the common reasons why a number of startups might not have survived !

Living in Isolation

The internet world is moving very fast. A number of changes in technology and industry are happening each day.A lot of entrepreneurs tell us that one of the reasons they see a lot of scale and success early on is because they listen to their customers and use the feedback to build new features into the product. “Listening” is an art that is very crucial while building a company.Listening to your customers, investors, team and competitors is very very important when building and scaling a startup.

Most entrepreneurs start off with a good intent. To listen to every one and seek advice from as many people as they can. However, a number of times, when you are extremely focused on building something, you end up loosing sight of how things around you are changing. Isolation from current pulse of the industry is what makes a lot of startups shut down as fast as they start.

The Team

A good team is one of the most crucial points that every VC looks at when investing in a startup. And rightly so ! A good team can make or break the future of the company. By a good team one does not only mean a team with strong background but a team whose skills complement each other in the best possible way and also jells well in terms of temperaments of each member of the team. Most of the times, teams start off very strong by some extremely talented people coming together to form a team. However, the team fails to work well together leading to the failure of the company.


Money runs the world they say and it sure is true when it comes to the world of startups ! You might not need a lot of money to start your company but you will sure need a lot of money to scale the company. A lot of bootstrapped companies do very well too and you might not always require external funding to scale your company.

A number of companies, some big and some small, have been muscled out by competition just because the competition had more money to scale quicker and bigger. Making sure that your finances are planned is a very important step in making sure that your startup is a success.

Not solving the complete problem

The success of a company depends on the completeness of the product. If you really have to capture the market, you have to build a complete ecosystem that will solve the complete problem. If you do not fill in all the gaps, someone else will develop a system that will and will make you obsolete in the market that you discovered.

Not Planning

Even in the world of startups where things are changing every second with the blink of an eye, planning for the long term is important. Although the road to the destination might take a lot of twists and turns along the way, having a plan to reach the goal is extremely important. A lot of times, we speak to startup founders who do not think or plan for the long term and in turn completely miss out on seeing the problems that might arise in the future leaving them completely unaware of the situation when it arrives and turning their company obsolete.