Why Startups Fail ? || Startup Fail in India || Reasons Why Startup Fail in India

Why Startups Fail ? || Startup Fail in India || Reasons Why Startup Fail in India

Since the beginning of this year, we have all only heard success stories of Indian companies. We often overlook the firms that promised and projected market disruption but ultimately failed to make an impact and shut down because we are so taken aback by the sheer number of unicorn Indian startups. If the situation had been thus favorable, this statistic demonstrating how challenging it is to maintain a startup’s success would not exist.

Making something that no one wants

Most firms fail because the goods they produce are either unpopular or offer no actual advantages to users.

Do consumers comprehend how your offering satisfies their needs? Does it save them time, make their lives easier, or lift their spirits? What is the function of your offering?

Your product has no genuine value if it doesn’t address any of the aforementioned problems. Every major brand in existence today is aware of this. As an entrepreneur, you should concentrate on either finding a solution to a problem or improving one that already exists.

Know who your target market is right off the off, including their interests, lifestyle choices, hobbies, values, and other characteristics. Startups that miss this phase typically fail within the first several years.

7 Reasons Why 50% Start-Up Fails Within 5 Years - StartupGoWhere

Bad Hires

A startup’s staff quality has a significant impact on the health and profitability of the business. Before the company even gets off the ground, a leader without the necessary expertise in building a strong team could damage the reputation.

A bad hire will cost the business time and money, but it will also take a toll on productivity and reputation due to the compounding effects of hiring, dismissing, and rehiring.

According to a survey, 60% of poor employees have a detrimental impact on the productivity of the rest of the team. Additionally, 39% of companies claim that a poor hire decreased production.

Therefore, pay close attention to the hiring process to maintain your startup on the growth path.


Many ardent business owners fight to add more features to their new goods and services in the hopes that doing so will increase the solution’s attractiveness to a larger spectrum of customers. The product will get more difficult and less usable if more features are added. The art of focus involves focusing on what the bulk of your clients considers to be the most crucial task. The danger of burnout is high for startup founders since work-life balance is uncommon. Burnout was indicated as a reason for failure 5% of the time.

The Top Reasons Startups Fail [Infographic]

Poor Sales and Marketing Execution

Many business owners find sales and marketing to be mysterious. Because of this, the vast majority of founders simply concentrate on creating the product. They pay no attention and disregard the marketing and sales facets of the company. Founders usually look for investors or consultants who can connect them with clients or help them hire a great salesperson when they are forced to think about sales. The founders have high hopes for these unidentified, well-connected salespeople, who they believe will show up, perform their art of persuasion, and resolve the sales issue. Therefore, as a founder, you must assemble a knowledgeable sales team. Your startups will be successful if they have good products and a strong sales and marketing team.

Discordant Co-Founders

While operating a firm alone is challenging, doing so with a non-compatible co-founder is a sure-fire recipe for failure.

Co-founders that are incompatible cause unresolved conflicts that worsen over time, ruining their relationships and making co-founder breakups tough. This leads to commercial failure as well.

Therefore, for a firm to succeed, it needs a compatible co-founder. However, selecting the ideal co-founder can be as challenging as selecting a spouse. Pick a co-founder who has a similar vision to yours, is upbeat emotionally, has distinct operational abilities from yours, and has a complementary temperament.

Why Do Most Startups Fail? Top Reasons for Startup Failure | LITSLINK Blog

A lack of creativity

77% of venture capitalists believe that Indian entrepreneurs lack innovation or distinctive business models, according to a survey. According to a survey by the IBM Institute for Business Value, the main reason why 91% of firms fail during the first five years is a lack of innovation. Despite having the third-largest startup ecosystem in the world, India lacks meta-level startups like the well-known Google, Facebook, and Twitter. Instead of developing their startup models, Indian companies are renowned for copying established international startups.

According to a list of the 50 most innovative companies in the world, startups like ChaiPoint, Ola, Saathi, and Swiggy would be among the most inventive in India.

5 Reasons Why Startups Fail and How to Prevent It | RubyGarage Blog

Lack of resources

The bike-rental business Tazzo closed its doors in 2018. According to one of its fundraising partners, the cause was a bad product-market fit, which caused funds to stop coming in. The firm closed its doors despite having raised a substantial sum of money due to the absence of a successful business plan. There are countless startup ideas out there. But it takes money to make ideas a reality. Those who succeed in getting investment require successful and scalable business concepts to expand their startups. One of the main causes of startup failure is a lack of capital.

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