Why do so many startups fail?



What do you think? What is the main reason behind this?


Top Reasons -

  • Run out of cash
  • No market need
  • Poor product
  • Poor marketing
  • Not a right team


You won’t believe it but actually the real truth why most of the startups fail are for very very simple reasons:

  1. No Planning.
  2. Opening startup because they want to be their own boss.
  3. “Assuming” there’s demand for what they want to offer.
  4. Lack of Research.
  5. And this is the worst of all - Opening a startup because you want to make a lot of money! And not because you want to help people.
  6. Underestimating the amount of work it’ll go into building one.
  7. Opening with the mindset that the startup will be a hit in a matter of few months because this is the age of startups.


Wrong Product in market that lack demand
Bad management team
No proper timing before lauching the product or service
Lack of proper backup if the plan fails
Poor allocation of resources and money
Lack of trust in the project


no proper setup like marketing and branding , good workers . if this Three is there means no one can stop the growth of our business.


I Agree to the points mentioned by you.To have a Start up only to earn money is a big time flop show .Your business will only survive if your a passionate about your work and the project your are working.There will setbacks , you will fail a number of times before you succeed .You will have to work for others , we have consumer if you don’t consider consumer your boss than things will not workout .Even before starting a good research is required whether your service or product will be accepted or not .Start only if you are passionate about it and not with the intention to make money


The main reason for startup failure is due to lack of strategy planning and proper market research.


In the StartUp environment, it is easier to fail than succeed. For every Google, Amazon or Flipkart there are thousands of others who didn’t rise up to the challenge. Most StartUps fail as they commit serious blunders in their early days. Here are some of the common StartUp blunders and how you can avoid them.

  • Long Wait from Idea to Launch

You have a Billion $$ idea and you are looking at creating the perfect product out of it. You go through several rounds of discussions, deliberations and track changes before you agree you have the right product for your customers. But there is a slight problem it has taken a bit longer than you expected and the market has changed or someone else has already come up with something similar.

The Fix

As a StartUp, speed and adaptability are your biggest assets. You don’t need to go through layers of corporate bureaucracy to launch your product and hence should make sure you bring it out before the market shifts dramatically. This doesn’t mean you should compromise on the quality of your offering. But you shouldn’t let things like a proper office, the complete product offering, funding etc. delay your launch.

  • Not Defining Clear Roles for Co-Founders

Startups aren’t born in boardrooms, they aren’t born out of a well-defined process and often born out of nowhere. And when you have a few co-founders not defining roles and titles would spell dooms for the future. Since co-founders are often known to each other (being friends, colleagues or relations) they may avoid this conversation in the early days thinking it to be rude and inappropriate. This often proves to be disastrous.

The Fix

Everybody brings different skills to the table and fixing roles and responsibilities based on those skills is the ideal way to go about right from taking baby steps. The co-founders should clearly define roles and put them on paper as this would save them from ambiguity and disputes in the future.

  • Focusing on Skills and Ignoring Culture While Hiring

The first few steps are the most important ones for any business and hence startups need to hire the right team. It is here that most startups make the mistake of choosing skills over culture. If things work according to plans, there won’t be any problems but if your employees look at the job just from the perspective of employment they would jump the ship at the first signs of rough seas. This often creates a lot of negativity and frustration among other team members and can bring down your idea like a house of cards.

The Fix

Focus on the goals that the individual has and see if this blends with the culture you wish to have in your organisation. Is he/she willing to take the plunge and stick around in bad weather, work longer hours or even go out of a way to get things done? As for skills, it can easily be developed through training if you have the passionate people in your team. The team has to have a singular vision.

  • Seeing Management as Just another Role

It’s your idea, it’s your company and you know how to manage it, right? Wrong! Management isn’t everyone’s cup of tea. While you may be the biggest motivation in your StartUp, that doesn’t necessarily make you the best person(s) to manage the show. Often poor management skills and in-apt corporate governance knowledge tends to put great ideas into a spot of bother. StartUps’ can grow fast and be trying to have an iron grip over the functioning of the company and micromanage every task can kill it.

The Fix

You need the right person to run the company. It pays to hire a seasoned professional who would complement the co-founders in running the business while you work towards refining and redefining your initial idea. Recall how Google co-founders Larry Page and Sergey Brin hired Eric Schmidt in their early days as CEO and you would understand what we are talking about.

  • Raising Huge Sums of Cash Too Early

Every entrepreneur has money on his/her mind. After all this money acts as oxygen for the idea to grow into a product and allows StartUps’ to realize their dream. Problems seep in when you raise too much money, too early from Angels and VCs and aren’t able to show them the promised growth. This is when the Angels and VCs would tighten the grip over management of your company and would alter your dream. They want strong ROI and don’t care much for your idea if it isn’t meeting expected results. Raising too much capital too fast would also require you to part with more equity for a lesser price.

The Fix

In the early days, you must have your complete focus on maturing your idea so that it makes a grand entry into the market and becomes acceptable faster. You should look forward to raising the money to power the wheels of your company instead of bettering your individual lifestyle. In fact, when there are constraints it often sparks out creative ideas and betters your growth story. Make sure the goals of your previous round of funding have been met before you look for new investors.

  • Forgetting the Customers

Recall the first discussion you and your co-founders had. It would invariably be centred on your potential customers and how your products or service would improve their lives. Sadly many StartUps’ tend to shift their focus from customers when they are too engrossed in attracting investments, acquiring other companies or going on a brand building exercise. Customer satisfaction is similar to your foot on the accelerator; the moment it is pulled back your growth slows down.

The Fix

Right from the day you launch your product or service you should always focus on your customers. If an investor’s ideas or suggestions would lead to customer dissatisfaction you should say no to such investments and look for money elsewhere. If customers turn their back on your company there is no way you would be able to create the magic you have been dreaming about.

Let the Team at Veloz Techform help you forge a path to success. Connect with us today and get help in accelerating your success.


Under estimating . everything


The major reason for startups to fail is that most of them are focused on funding and easy money. Instead of focusing on the business, they are searching for ways to get funding quick. They are more interested in the pitch deck and trying to do everything that would make the Pitch-deck look lucrative.

I am a start-up consultant and within 10 minutes of discussing every idea, I definitely get a question. do you think I’ll get funded? when?

This is where the mind set needs to change.