You must have heard about the meteoric rise of certain startups as well as the unfortunate failure of a few. In a world where millennials are out to change the world, and investors are ready to invest in an idea at the drop of a hat, not every startup gets to the unicorn stage. In fact, many startups wear off sooner than they can even hit break-even. However, a few accomplished entrepreneurs like Mr. Neetish Sarda have achieved the unachievable with their sheer brilliance and hard work. Mr. Neetish Sarda is the founder of Smartworks, India’s leading provider of managed office spaces. With his extensive expertise in real estate, construction, and business operations, Mr. Neetish Sarda has created wholly managed and customizable offices. He has set an example for young entrepreneurs to take their startups to the next level. Besides taking inspiration from successful entrepreneurs, individuals trying to make it big in the business world should also learn from the failures of the startups that couldn’t make it big. We have surmised all these factors in the below pointers. Let’s find out why some startups fail and why only a few founders last in the long run.
Lack of Focus- a Few Founders
Many founders start with the idea of solving a specific burning problem, but as competition catches on, they lose focus and branch out into multiple directions, trying to offer a solution for almost everything under the sun. Therefore, it’s important to stay focused on the core objective that the product or service is trying to solve and not offer too many features at the nascent stage. Instead of that, one should focus on the core USP of the product or service, which can prove to be an asset for the company. The metrics and goals should always be kept in check, as most startups fail due to the whimsical nature of spending and lack of transparency. Without proper alignment and transparency, long-term growth is not possible.
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Premature Hiring- a Few Founders
A startup should settle down before starting hiring. Hiring for a big MNC and hiring for something which is at an initial stage is different; the scalability comes into the picture here. The ability to figure out the right candidate in one or two hours of the interview is highly required.
Poor Leadership- a Few Founders
In the long run, a businessperson needs to stick with leading instead of micromanaging. As a business leader, a person shouldn’t get too much into details.
Goals not Aligned
A startup’s objectives and goals should be aligned with SMART principles (Specific, Measurable, Achievable, Relevant, and Timely). A few startups keep short-term objectives. But the majority of startups are not able to sustain as they don’t outline their long-term goals beforehand. Short-term goals are required to achieve monthly or quarterly targets, but if the long-term goals are not in place, the company will stumble.
Lack of Infrastructure
A startup needs to have the right infrastructure. It’s imperative to have suitable office space, IT systems, and other related procedures in place. There should also be systems to communicate and interact with people in the fast-track competitive scenario.
Delay in Funding
A businessperson should stay proactive when it comes to looking for suitable investors.
One needs to have a proper business plan when it comes to raising funds from the investors. It takes time to make the investors understand the business plan. No investor will put money in a venture without understanding the business objectives, strategic plan, value proposition, financials, and returns.
Don’t Over-Customize
If a businessperson wants to scale up the business, they should stop overpromising as it might lead to under-delivering in certain cases.
Scalability Issues
One of the major reasons for startup failures is scalability issues. A rapid expansion does not signal profitability.
Lack of Focus on Marketing
Recent reports from startup failures suggest that there is always a lack of concentration concerning their marketing products or services.
Agility not Rigidity
Strategic decisions taken for the larger good of the organization need to be agile. Unforeseen problems might take place due to changes in the market and aggressive competitors. In such cases, a startup needs to be agile enough to change their course or incorporate new changes as per the market trends.