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Top 10 reasons why Startups fail

Door StarterSquad op 24 november 2014

This top-10 is derived from my personal experience, directly by coaching more than 100 startups and indirectly through my involvement in 300 other startups over the last decade.

  1. Underestimate timelines before the company is making profit (underestimating the marketing & roll-out costs)
  2. Overestimating the market size
  3. Funding problems and cash flow problems
  4. Problems with customer acquisition (“everyone likes it, but nobody buys it”)
  5. No clear pricing and/or revenue model
  6. Not enough experienced sales power in the team
  7. Competition of other products or services
  8. Product / service is not as good as expected
  9. Problems with scaling up and growth
  10. Internal troubles within the management team

1. Underestimate timelines before the company is making profit (underestimating the marketing & roll-out costs)

Lots of startups really think they make profit within 12 months. In all the business plans, I see huge revenues in the first year. In practice, unfortunately, most startups still have a negative cash flow after 3 years.

2. Overestimating the market size

Lots of startups start to calculate…

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