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Startups That Failed Before They Took Off

Smruthi Kishore

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Silicon Valley is where startups go to become sweeping success stories. However, there is a flip side to the magic of Silicon Valley. Startups not only rise, they also fail. As the weekend comes on us, here is looking at startups that failed before they could take off the right way!

1. Blackberry 

Before the iPhone became what it is today, the Blackberry was the phone everyone wanted to own. Not only was it a device, it was a cult. However, before the “crackheads” (as they were unoficially called) could change the world with this device, something went wrong. Research in Motion (RIM) as Blackberry was formally called, failed to keep up with the changing pace of the world. RIM refused to change its technology and stuck to the traditional forms, without moving up the ladder like the iPhone. What started off as a bang fizzled down to a sale of only 4 million devices annually by the year 2016. Now, out of production and out of business, Blackberry is but a mere shadow of its former self. However, despite the failure of the device, Blackberry did set in motion a smartphone revolution like never before!

2. AOL 

The failure of AOL (America Online) was a disastrous event that still surprises people. Not only did the service give detailed information in a quick manner, its instant messaging service was also arguably the best in the world at the point. However, the email service refused to grow with the world and accepted defeat with the quick growth of Gmail and Yahoo. Incidentally, Gmail’s “You’ve Got Mail” notification clinched the email platform’s presence in the world with complete surety.

3. My Space 

Back in the day, My Space was were stars were born and musicians were launched. In fact, it was given the title of being among the top 50 best websites in the year 2006. However, Facebook came, saw and conquered and My Space was left crawling in the dust like a helpless animal.

4. Kodak 

Kodak was the inventor of the traditional form of photography in the 20th century. Steve Sasson, the man who invented the first digital camera in the year 1975, was actually asked by his supervisors to not do anything. They did not see the value of digital photography and this one reason inevitably resulted in Kodak’s halt to world domination in the form of pictures!

5. Nokia 

If the Blackberry refused to grow with touch technology, Nokia refused to look at data as the next big thing. While other smartphone companies circled towards this change, Nokia shrunk away and refused to accept this form of growth. This caused Nokia to develop a mess of an operating system with a bad user experience that just was not a fit for an always expanding market and thus, failure was but very obvious.

Every company has to start some where. Every company has to grow and fall and failures comes as a part of the parcel. If you think we missed any startups, please comment and let us know!

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Starbucks Success Story

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Starbucks Success Story

Coming from a poor working class family- Howard D. Schultz, the CEO of Starbucks transformed his life by establishing his company into the world’s biggest coffeehouse company.

Schultz was born on July 19, 1953, in Brooklyn, New York, in a poor family. His father was a former US Army trooper and then a truck driver.

His childhood was spent around poverty, Schultz lived in a neighbourhood with low-income families. Schultz witnessed his father struggling for money. At the age of seven, his father injured his leg at work and had no medical insurance, so the financial strain on the family left Howard scarred with terrible memories of his childhood.  “I saw my father losing his sense of dignity and self-respect. I am sure that this was caused mostly by the fact that he has been treated as an ordinary working man.” – Howard Schultz recalls.

In high school, Howard played football that earned him an athletic scholarship for Northern Michigan University.

Upon starting college, Schultz realised he did not want to play football and chose to major in communications. To pay for school he took out student loans, worked as a bartender and also sold his blood for money a couple of times.

After graduation, the future entrepreneur spent three years working as a sales manager at Xerox, then joined Hamamaplast a Swedish company.

The company sold various home appliances that included selling coffee machines to Starbucks.

Starbucks caught Howard’s attention when it placed an order for a large number of coffee machines, this led him to fly to Seattle to meet the owners, Gerald Baldwin and Gordon Bowker.

After a year of constant persuasion, the Starbucks owners hired Howard as the director of retail operations and marketing. At the time there were only three Starbucks stores.

The trip that changed Starbucks and Schultz’s career was his trip to Milan to attend an international housewares show. While exploring the place he came across small coffee shops, where the owners developed personal relationships with their customers, even calling them by their given names while serving them cappuccinos and cafe lattes.

 

In 1985, Howard quit Starbucks as his Italian based coffee experience idea was rejected by the two founders. He then went on to create his own coffee company called ‘Il Giornale’ Italian for ‘The Daily.’

Howard Schultz remarks, “Only those who go by unexplored roads, creating new industries and new products, can build a strong, long-lasting company and inspire others to achieve great results.”

Over $1.6 million was required to get Il Giornale up and running. Schultz describes his struggle “In the course of the year I spent trying to raise money, I spoke to 242 people, and 217 of them said no,” he wrote. “Try to imagine how disheartening it can be to hear that many times why your idea is not worth investing in. … It was a very humbling time.”

He spent two years replicating the coffee culture he had experienced in Italy, at Il Giornale. In August 1987, Starbucks was purchased by Il Giornale for $ 3.8 million.

Starbucks became a public company in the year 1992. In June of the same year Starbucks sold its shares on the New York Stock Exchange for $ 14 a share, the price rose up to $ 33 in just one day.

To retain the quality and to give customers perfect coffee, in 2008, Schultz closed over 7,100 Starbucks stores to retrain the baristas on how to make the perfect espresso. The next two years the company did a massive turnaround, in 2010 the profits tripled from $ 315 million to $ 945 million.

Starbucks now has an annual sales of over $16 billion. Schultz net worth also rose to $ 3 billion. Once Schultz said, “I cannot offer you any specific secret recipe for success, the perfect plan, how to reach the pinnacle of success in the business. But my own experience suggests that starting from scratch and achieving much more than what I dream about is quite possible”.Starbucks now has an annual sales of over $ 16 billion. Schultz’s net worth also rose to $ 3 billion.  

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The Alibaba Success Story

Smruthi Kishore

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In 1999, towards the end of the dot.com frenzy, a group of 18 people led by Jack Ma started Alibaba in a small apartment in Hangzhou, China. Nineteen years after its inception, this wholesale online marketplace is now the world’s largest e commerce platform, running on par with the likes of Google, Amazon and PayPal! What makes Alibaba’s journey to success so inspiring is how the e commerce platform reached to the top in less than two decades!

Jack Ma learnt of the internet when he went to the United States in the early 1990s. Unlike the United States, China still had not embraced the internet revolution. When Jack Ma returned, he decided to tap into the uncharted waters of the world wide web with the idea that was Alibaba. With an initial investment of $ 5 million and 17 co founders, Jack Ma launched Alibaba’s  online retail platform!

The launch of Alibaba’s online retail platforms – Alibaba.com (B2B) and 1688.com (B2C) – was fortunately timed; the consumer internet boom had only just arrived in China and the local market was not as direly affected by the dot-com crash as its American counterpart. Other future e commerce markets such as India had barely even begun exploring the sector.

With a funding of $ 21 billion from SoftBank, the 21st century began on a very positive note for this steadily rising  e commerce platform. Post this investment, the money kept pouring in! A year after this influx of cash, Alibaba launched Taobao.com, the Chinese version of eBay! Looking at the positive response received, Jack Ma ventured into other areas like an instant messaging tool called Aliwangwang and third party online payments platform Alipay. These three businesses would eventually evolve into the ‘iron triangle’ of e commerce, logistics, and finance upon which the Alibaba Group of today is built.

Having secured a funding of $ 25 billion,  Alibaba was declared the largest and the most profitable e commerce platform in the world by the year 2016. With a market value of $ 231 billion, there was no stopping this company! One of the major reasons for this stupendous growth structure has been credited to the informal employee beneficial policy at Alibaba. The conglomerate has also been very active in shaping and bolstering China’s entrepreneur ecosystem  while launching several projects to better China’s rural areas. In 2010, Alibaba announced that it would contribute 0.3 percent of its annual revenue to environmental awareness and conservation efforts around the world – resulting in a $ 4.71 billion turnover. The firm has also set up an independently funded group called the Alibaba Foundation, that tackles social issues. From being a lost and broke boy in China to being a massive success overnight, Jack Ma has truly come a long way!

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How Online Marketing Can Be Used To Promote Your Business

Startup Admin

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First, you need an idea, then you define a target demographic and finally, you make sure your product is of selling value! Once you have all your formative ducks in a row, its time to think of a marketing strategy. In a world that is leaning towards the digital side of life, there is so much one can do to grow a new business. If you are still wondering about how to grow your business the digital way, then these strategies might just help you!

1. Social media 

In this digital world, social media just cannot be ignored. This is where all the “magic” is happening. A rule of thumb to follow for social media is to be authentic and true to you as well as to your brand. Your audience can smell pretense a mile away and the moment they detect signs of false promises, your brand is negatively affected. To create a direct contact with your audience, make sure you reply to messages as often as possible. By doing this, you are building a loyal audience for yourself and letting people know that you are open to feedback! Social media is tricky and done right, it can help your business grow in leaps and bounds!

2. Leverage influencers 

Influencers are the new flavour in the field of online marketing. If you are looking at a way to increase the online presence of your brand without taking years to build your audience, then influencers are the way to go! Find the right influencer in your niche so that you target the right audience. It is not just about spreading your message. It is about spreading your message to the right consumer base. If you can do this properly, then you can reach a sizable audience for not much money invested when you think about the potential profit it can return.

3. Be different 

“Be you. Everyone is already taken.” How many times have you heard this and why does it ring so true? Simple answer? It is! Everyone is already taken, why do you want to sing the same old tune over and over again? With social media being social media, there us the chance of being different by being you. Be original and quirky and uniquely represent your business through advertising and marketing. Show everyone not only why your business is awesome, but why it is head-and-shoulders above everyone else.

The world is constantly growing and with change, comes innovation and creation. No matter what marketing strategy you use, if you do not have an effective sales funnel and optimize your conversions, you will just be throwing money away.

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