According to the most recent startups statistics, about 90% of startups fail within the first year acrossall industries.
70% of startups fail within the second to fifth year in the business. Startups don’t stay startups as soon asthey find that product that can launch them. Reasons range from customer demand, not enough cash and a weak founding team. Until then, startups should be very careful working on shaky ground. Big brands such as Google and Amazon started as startups and have been known to have humble beginnings. If you haveyour own startup right now, this article will be listing some of the most common mistakes of startups that can jeopardize their future.
According to CB Insights, the top reason for startup failure is due to misreading market demand which constitutes about 42% of the cases. As we mentioned in our article, Five Questions To Ask When Launching an MVP., understanding your market and their customer journey is important. This can give you an idea om how will you be part of their lives and what problems can you solve for them. Problems that they are aware of or problems that they may not be aware of yet.
Research can also show if the market size is big enough to get returns or not. Depending on your objective, this can give you an idea of where to invest and what market to cater to.
Even if you are using a no-code platform, you should constantly check if you are on the right track by setting up a feedback system from current or prospective customers.
When your business starts to get steam, you might be tempted to get a bigger office, hire more people and invest in more things. STOP! This can leave you stuck with a spacious office, overstaffed, and no funds to go around.
Keep your staff and resources lean as long as possible. This gives time for the product and business to grow while keeping finances out of the way. There’s no point in investing resources until your product has traction and everything is working. Sometimes, rushing to build a team can even be fatal to businesses and can cause bigger problems. Choose cost-friendly options like working with no-code first so you can realize your vision at a lean staff.
Evaluate a tipping point that doesn’t exhaust your team and assets to make sure that you can keep the lights on the place.
Startups usually think that once a product is groomed to launch then everything will take care of itself. A business plan includes operational costs, ROI, and product plans that can keep the company afloat. On the other hand, a marketing plan includes promotions and brand management that should target awareness and trial for the product. This also includes competitor monitoring that can gauge your product’s performance and provide insights.
Marketing may be deemed as a mere expense but it brings the people to your product. The right strategy and messaging are key to getting your product at the forefront of your target market.
Find the sweet spot for your launch period. Launch too late and you already have others with the same idea that you product will not stand out. Launch too quickly and you have a haphazard product in your hands.
Research and development SHOULD take time but also be aware of how to sell your product at the time of its launch. We have discussed MVPs and how they can help your business HERE. One of the key things we mentioned is that MVPs are all about making it viable to the customer while making room for improvement. It should be able to serve while being able to gather data so it can be iterated and innovate. Working with a no-code agency can help you launch your MVP app, software or website faster than regular coding. This can give you a chance to collect data and iterate until it becomes the product you want without being shoddy.
Creating, innovating and earning is the fun part of setting up a business. However, the paperwork and legalities are the things that matter. As much as possible, invest in making and reviewing contracts. For every partnership and NDAs, make sure to have everything in writing. Have a proper bookkeeping process as well to manage your numbers and have a correct analysis.
As a startup founder, there is one thing that you should do - don’t be afraid to try. If you have a hunch that seems right and can be a game-changer, then see if it’s worth the risk. Just make sure that your bottom line is always covered so you won’t risk bankruptcy .Enjoy the process of discovering and just go to work until you make it.
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