What Do Specialists Say About the High Number of Failing Startups?

A startup is every aspiring entrepreneur’s hope. It is a dream project that is so dear to them. The idea of owning and running your own business attracts countless young minds. But not all of these entrepreneurs get to see success.

In fact, a whopping 90% of all startups fail. And 10% of the failing startups collapse in the first year. These statistics are enough to scare people away. But here’s the thing, there are some specific reasons why startups fail. And being aware of these reasons is sure to help a business owner in dealing with them.

So, what are the primary reasons why startups fail? Some people say it is because of the lack of leadership. Yes, good leadership is crucial for any business to succeed. But the failure of a startup is not only because of poor leadership.

Let’s take a look at four primary reasons why startups never get to see success.

Reasons Why Startups Fail

Reasons why Startups fail

Note that there isn’t one reason behind the failure of startups. It is always a mix of factors that contribute to its downfall. So, let’s go through some of these factors in brief!

Lack of Smart Leadership

When we talk about leadership, we often look for strong leadership. But smart and astute leadership is just as crucial for a startup to succeed. In the business world, making the right decisions and the right time is vital.

For example, the founders of Instagram sold their operations to Facebook at the right time. Instagram was growing at a rapid pace, and soon it would need better infrastructure. There was no guarantee the company could handle operations on such a large scale. And the decision to sell its operations was a clever thing to do.

The future of any startup depends on the leaders making the right decision. That’s why it is sometimes not enough to be a firm, strong leader. Instead, the leader of a startup needs to have a bit of flexibility in his decision-making.

Unreasonable Pricing

Pricing is another aspect that some new startups get wrong. The pricing of the products needs to be reasonable. This is even more important for startups. And a lot of startups fail because their products are too expensive.

Now, there’s nothing wrong with rating your products high. But it is always better to look at the nature of the market. Only then should you make pricing decisions. That’s why proper market research is vital for any business to succeed.

Overpriced products also give your competitors a golden opportunity. So, if you run a startup venture, make sure to be careful with the pricing.

Bad Marketing

We all know how important marketing is for any business. And it becomes even more critical in the case of startups. Again, the key is to market the right products to the right people. But, unfortunately, doing it isn’t as simple as it sounds.

Even the most innovative product ideas need good marketing to succeed. But, unfortunately, a lot of startups fail because they fail to market to the right audience. And proper market research is vital in order to create successful marketing campaigns.

There are several good marketing examples to learn from. Many startups have seen incredible success because of their marketing strategies. And their success is a testament to the importance of innovative marketing in today’s business world.

Fear of the Competition

The big names in the industry can be scary for startups. And if the mindset of the leaders isn’t right, the fear of competition can sink a startup. One can take this point as an extension of the earlier leadership point.

No matter which market a startup chooses, there will be competition. One can’t expect running a successful business to be a cakewalk. If you own a startup, you need to have the right mindset. And being petrified of the odds isn’t the right mindset.

Instead, startups should gain motivation from the challenges. In today’s ruthless competition, that’s the spirit one needs to succeed!

Learn From the Failing Startups


Do you own a startup? Then it would be best if you learned from the good examples. But there’s a lot to be learned from those who fail. Don’t forget to take lessons from these reasons why most startups fail. It can help you make it to the 10% of all startups that get to see success!