We have a lot to learn from Startup Failures than Successes!
It’s daunting, overwhelming, and equally exciting- starting a business. If you consider whether or not to open your own business, there is nothing to lose by learning from experiences coming from Startup Failures. Take a look at these startup failures for an idea of what could happen.
Every entrepreneur has thought about opening their own business at some point in time, and many have even started one. But opening your own company comes with its share of challenges and risks.
Among the things to think about (and to budget for) are learning and training, recruitment, marketing, networking opportunities, staff attitudes, and so on. One of the least discussed things is what happens if your business fails
Startup Failures Types
There are two types of startup failures. The first is an actual company closure (most people associate with bankruptcy), which occurs when a business does not meet its revenue or other financial goals.
The second type of startup failure is more subtle. It’s not necessarily a matter of whether the company has enough capital to stay in business. Rather, it’s a question of whether the company had accomplished what its owner(s) set out to do when they started ( business model, product-market fit, startup founders, startup capital, viable business model),
For many entrepreneurs and business owners, the initial business plan is simply an outline that will change as they learn more about their customers and problems.
The business plan is then adjusted to fit the new reality. But for others, the business plan is more definitive and outlines how the business will operate. The problem with this approach is that starting a company doesn’t mean you are starting to build a real company. In many cases, it’s just an attempt to make a quick buck or “get rich quick.”
The lesson here is that if your venture fails, it won’t necessarily be because of anything. It will be because you failed to meet the fundamental objectives that you set out for yourself.
How to Avoid Critical Startup Failures
1. Not Having A Business Plan
A business plan should include a detailed description of your product/service, who your target market is, where you’re going to sell your products/services, how much money you need to start up, and what you expect to get out of the deal.
2. Not Knowing Your Market
If you don’t know who your potential customers are, you can’t effectively communicate with them. You’ll also lack insight into why they buy what they buy, and what they want. This means you may miss out on valuable insights about your market.
3. Not Having An Exit Strategy
Having a clear exit strategy is critical to any successful business. Without one, you risk wasting all your effort and resources building something that nobody wants.
4. Not Being Able To Scale Up
You can’t grow a small business into a large one without having a strong foundation. Startups often fail due to poor management skills, lack of experience, or lack of funding.
5. Not Having Enough Capital
Capital is required to run a business. Most startups fail because they either don’t have enough capital, or they use it poorly.
6. Not Hiring Properly
Hiring is arguably the most important part of running a business. If you hire the wrong person, you could waste months or years of your life trying to train him/her.
