Top 10 Reasons for Startup Failure


A startup is a company or venture which offers the variety of products and services that are not being offered by any of the company in the market. Starting a new venture is difficult, due to this 90% startups fails. But we should learn from every failure. Now we’ll focus on some reasons why startup fails and their solutions.

#1 Absence of Market

Thie most important cause of startup failure is the absence of a market. Every business needs a market to grow and sustain among the big giants, but in case of a startup, there is no market need. Every market has problems that are not solved but it’s an opportunity for someone who can solve these problems by their startup. Sometimes our market timing is not good and we didn’t get funding. Finding the solution to an unsolved problem is not so easy that’s why startup fails.


We should first discuss our product idea with people in the market and also should do some research about the industries.

#2 Insufficient Funds

Most of the startups fail because at some stage they are not able to raise funds for their venture. Money is very essential need to run a healthy business. If a startup is running out of cash then the company can’t able to give salaries to employees and also the company bills. Every entrepreneur should be aware of KPIs (Key Performance Indicator), using KPIs they’ll get investments.


The company should keep tracking the account details and for how much time the company can sustain, and the company also need to save some amount of capital in case of less cash.

#3 Poor Marketing

A startup can fail if the marketing is not done incorrect manner. Marketing is important for every small and big business or organization. Nowadays marketing is done in different ways like Digital Marketing in which marketing is done on the web platforms like Facebook, Instagram, Youtube and many more. In today’s world without marketing, your business cant’ survives.


Marketing should be done before the completion of the product. The employee that works in the marketing department has to take care of the customers also. If you have little knowledge of marketing hire an agency.

#4 Wrong Team or Management

To run a business, we need a strong team that will manage each and every single department like sales department, accounts department, marketing department etc. Wrong team selection can cause failure of a company. Because of wrong team employee doesn’t focus on the product development and it creates a bad impact on your business.


Make sure that your team communicates on each aspect with every team member and management is capable of taking its own decisions.

#5 Bad Product

Startup fails due to the poor quality of products. Many Businesses doesn’t focus on the product and this leads low quality in the product. For example – If a person wants to buy a smartphone with good camera but the shopkeeper has given the product of low quality then the customer will be dissatisfied with the product and will never come back again.


#6 Overconfidence

Confidence is good in business but overconfidence can cause too much harm to your business or startup. Sometimes the owner gets overexcited and overconfident due to his/her massive growth and sales. Because of overconfidence person can’t give there 100% to the company, they think that everything is fine but it’s a myth. In beginning, they spend lots of time on their ideas but soon they give up on those ideas due to overconfidence.

#7 Price Issue

Price is the money according to which we buy or sell products and services. Price is the main factor in every business, without the price we can’t sell any product. When we think to launch our product in the market than we first discuss the pricing of the product, right pricing can gain the sales and demand of our product. If we are demanding higher cost for a cheaper product then no one will buy our product. Sometimes the owner raises the price to 2 times and this leads to the decrease in the demand of a product.

#8 Wrong Business Model

It is the model or planning of business that how business operates. In a business model, we plan for every single requirement like operations, sources of revenues like investors, customer needs, different products that can be offered to customers. There are so many companies which focus on business models again and again for the betterment of the startup or venture. If your business model is wrong then your company will be closed soon. The business model contains many steps like identifying the audience, strategy of demand generation, working capital model etc.

#9 Ignoring Customers

This is the reason by which businesses lose customer relationships. Ignoring the customers after selling a product or after given a service is not good at all. In business, customer feedback is so important to know the real face of our product and services. Before feedback customers should be satisfied with our service and product. We don’t focus on customer reviews and opinions, and can’t talk with our customers about our product. Many startups do not focus on customer feedback that the customer is satisfied or not, they only focus on the sales. So many companies have the position in the market but don’t have the good customer feedback.

#10 Wrong Priorities

When we focus on too many things and want every work to be done at the same time then we lose focus in startups. Sometimes people get distracted which leads to loss of resources and money. Another cause of losing focus is the Micro Management. In general, micromanagement is the management where a manager closely looks at the work of his employees which leads to lack of freedom in the company.


Please enter your comment!
Please enter your name here