Why startups fail? The odds are against you!
It is unfortunate that 90% of the startups wind up their business within the first five years of their incorporation. To make matters worse, 45% shut their doors in the first six months. This is because of some costly mistakes that owners make. Here are some marketing tips to get your startup beyond the teething problem.
How to increase the likelihood of your startup success?
I gathered a few statistically proven ideas that will help you to increase the chances of your startup success and avoid failure. Make sure to go over this list before going on this crazy adventure called a startup, it many be the one thing that stands between you and success.
1. Make a product to cover an existing gap in the market
Product that solves existing problem. Do not create products and then create ways to get your target clientele to use them. Where there is no need, they will not buy. According to Forbes magazine, 42% of startups close doors as their products lack the market.Where the startups build products that cover the needs of the target market, many fail to reach the targeted market. If you have good products that the market is not aware of, they are of no use. As put by Gabriel Weinberg, the CEO& Founder of DuckDuckGo, “Most startups don’t fail at building a product, they fail at acquiring customers”.
2. Know when to Scale up
About 74% fail, due to premature scaling .i.e. spending too much on such activities as human resource management and marketing before they set up the preferred business model. It is important to have the business model right at the business plan stage. It’s a crucial point at every startup life cycle and 3/4 fail!
3. Learn Business Management
It is important that entrepreneurs go back to school and learn the loops of financial and business management. Learning can happen as you continue with the venture. However, going to school before engaging in the business is preferable. In fact, 30% of the startups fail because the management lacks the competence and experience to handle the various aspects of hiring, marketing, and finances.
4. Marketing Marketing Marketing
Marketing is essential to the success of any business. You have to identify your trageted audience and channels that you will use to reach to them. Twenty percent of startup failures result from poor sales and marketing strategies.
5. Be flexible and allow your startup to change as the industry changes
There are no perfect management styles, products, or business plans. Ten percent of the startups that go down bounce back because they listen when they are supposed to change are flexible and put in place strategies to help them recover.
6. Two are better than One, Find a co-founder that you trust and appreciate
Bringing two heads together is better than one. You share ideas and liabilities and help move ahead. Eighty percent of successful startups have multiple founders, 48% of whom are aged between 35-44 years and 29% between 26-34 years of age.
7. Remember: Failure is the key to success!
Your last startup failure, actually increases your chance of successes! If you had experience as a founder of another startup, you have 39% chance of success in the current. In fact, 20% of those who fail in the first startup succeed in subsequent ones. 17.6% of first time startups funded by VC are likely to succeed as well as 22.1% of second trials who had failed in their first attempt.