There are quite a many Startup companies like SunEdison, Gozoomo, Picturelife, Electroloom, Talentpad etc., who kickstarted their companies with huge investments, and after a period started declining and failed to mark their presence in a highly competitive world. There are as many as 2000 Startup companies raising every year and to our shock, 9 out of 10 Startup companies fail in the consumer market.

Here, we give you an inception on why these Tech Startups fail.

1) Lack of skill or ability

  • Having an idea in the brain doesn’t really mean that you start your own company. First, analyze whether that idea is really enough to execute further plans.

  • Sufficient competitive analysis must be carried out.

  • Value bracket must be identified.

  • Calculate whether your idea is marker worthy

  • Stick to the handful resources you have.

  • Analyze if your product will be unique for customers.

  • Experienced and efficient employees must be on board.

2) Poor cash flow

  • Diminished finances and poor cash flow play a pivotal role in the failure of Tech Startups.

  • 6 out of 10 Startups run out of cash after setting up a Startup and they eventually seek funding help which further affects the company.

  • Inadequate administration, scanty finances, and deficiency in sales and finances are the major reasons why companies run out of money.

3) Inadequate marketing

  • The heart of your business success lies in its marketing. Profit or loss of your business depends on successful marketing.

  • A successful marketing can be expensive too. Many think marketing does not play many roles in business.

  • One must be aware of website developments, public relations, print and broadcast advertising and the use of as many available resources to promote your product.

4) Lack of administrative experience

  • Proper management is a key to a successful business. Proper management requires experience. Challenges like personnel management, crafting and executing company’s strategy need experience.

  • An experienced management team is clever to discover tactics that ensure company’s success in the marketplace.

5) Marketplace Stagnation

  • The business industry is a fast moving place. What is in demand today becomes out of date within no time. This is the major issue why tech Startups fail

  • The time taken to diminish is almost less than the time taken for the business to get established.

  • By the time a Startup get suitable funding and start their business, they enter the market only to realize there is already tough competition existing.

6)  Poor IT Infrastructure

  • When it is about tech Startup companies, these cannot survive without an IT setup and support system.

  • Startups need entire infrastructures such as powerful servers, connections, computers, and workstations for employees.

  • Because of these sophisticated networks, many tech Startups outsource certain sections of their work.

    The tech industry is one of the hardest nuts to crack. If you think of planning a Startup, think wisely before investing the right amount in the right place.

Leave a Reply

Your email address will not be published.