What mistakes kill startups?
Yenire leal
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Alexandra Cote@alexandracote
The Content Odyssey Newsletter
Not getting your ICP
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Not pivoting/moving fast enough
- Poor founder/team dynamics. Temet nosce always
- Poor decision making processes. Always know what your goals are, always have a North star and know when you're going off course (no moving goal posts) and always be ready to pivot when something better presents itself.
- Not loving the problem
- Not focusing on building an awesome and relevant product that solves a high volume, high intensity problem
- Not doing your homework for important things like managing finances
- Not valuing team mates/employees and putting them first
- Never planning for the worst
- Living/hiring as if the bubble (free VC money) is never-ending (ties back to valuing employees and being honest with them from the get go)
- Never taking care of yourselves (founder and team). Unhealthy practices like crunch time is a no no.
- Living like an artist (fake Steve Jobs) instead of a methodical iterator (real Steve Jobs)
...
Keep the list going 😉
@yenire_leal I'd say the one oft repeated mistake where I am is the fact that people tend to start-up with the aim to raise VC. The problem being solved solved and the solution they come up with end up being basically cookie cutter companies. When I tell them they're wrong and they should bootstrap, they always think me mad (despite knowing well enough that all their entrepreneur heroes did exactly that in so many cases)
It may be because many startup founders are after easy money; it may also be because it's something the local culture has taught them to believe. However, that mindset leads to ruin. When the goal becomes raising rounds, and no one comes offering checks to them, the team either falls apart, or pivots into a NGO/non-profit that does exactly what they want: grant seeking.
In my mind, the main thing is trying to solve a customer's problem in a wrong way or a non-existing problem. Other staff like marketing and investments will definitely fail if you don't find the real problem that should be solved.
There are many things that can kill a startup but I think the most important is the target audience. Deciding the right target and connecting with them is the way to success for any startup.
Your great copy doesn't make any sense if you send it to the wrong person. It only works when it is reached by the right person.
1. Professionally appealing name for your product and website/domain.
2. Very focussed marketing to reach the right audience.
and keep Sundar pichai happy.
The big 3 mistakes I see over and over:
1. Not getting a buy-in from early testers: this isn't the end, but it's a huge sign you either don't know your target or your product doesn't solve the issue.
2. Focusing on marketing too little: getting traction isn't only for the numbers, is for the data and insights. And getting users early is priceless.
3. Too many rituals: eg: excessive, processes, over-engineering, over-designing. Ask yourself if it looks like work, or it IS work.
Truly, these apply to bigger companies as well, but it's harder to tell and way more expensive if you don't realize.
A few things from the top of my mind:
- Doing too much stuff, focus is mandatory on startups and it is impressive how easy it is to lose it.
- Misalignment between founders, this happens very often and it's really hard to fix if it passes a certain point. We have hired specialists facilitators to realign more than once.
- Not paying the right attention to the customers, it is also easy to get lost on the day to day of work (building features, hiring, etc), demands from stakeholders and so on. But if you are not paying attention to your customers there is a huge chance you are moving in the wrong direction.
- And last, long feedback loops. The most important thing when building a business is to know every idea you have is an hypothesis that needs to be validated as fast as posible.
Make employee pay for coffee.
Lack of managerial skills in founders. I once worked in a great startup: a very talented team and a cool idea. It fell apart because of constant micromanagement and a total lack of communication skills of one of the founders.
A remote working solution.
- Not focusing enough on feasibility, prioritizing "cool ideas" over practical impact.
- Not understanding the market well enough.
- Rushing the launch too much and pushing out products that shouldn't be in production.
- Having no strategy, acting sporadically.
- Not setting up success metrics.
CalmGetaways
Few thoughts from a founder perspective:
- Not moving fast enough to adapt according to the market
- Founder(s) with rigid mindsets. They take themselves way too seriously and when they get proved wrong, it hurts them a lot.
- Not understanding the importance of humility. People respect it when you accept mistakes and take accountability for them.
- Being extremely delusional to a point where you deny reality. One needs to be rooted in reality and face it as it is to take best decisions for the present & future.
GetReminded
From my startup experience, the biggest mistake was to stop fundraising after we raised our 3rd round of Angel investment. Instead we used funds to improve the product and execute GTM plans - but we stopped talking to future prospective investors. That killed the momentum we were building that should have segued into our Seed round.
[BTW, we're not dead yet!]
@tim_nicholas Thanks for your comment, Tim. We must be attentive to these failures, so as not to commit the same in the future.
Not valuing their employees.
- No sales
- Saturated market
- Will to move ahead
- Clarity
It could be any reason to kill a business.
single founders that have the mindset of "I will do it all"
such founders find it hard to delegate work and build a team.
this significantly affects the startup.
NVSTly: Social Investing
Not sticking with your instincts is another, I believe
Poor idea implementation is one of the typical mistakes that destroys startups.
