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8 Mistakes That Kill Startups

Top 8 Mistakes That Kill

Let us look at some mistakes that kill startups

News: About three-quarters of venture-backed startup firms in the U.S. don’t return investors’ capital, according to recent research by Shikhar Ghosh, a senior lecturer at Harvard Business School. This information made me think and I have tried to summarize the main reasons for flawed-startups below in order to caution the young and growing entrepreneurs.

8 reasons for startup failure expleined

1. An Unscalable Idea

Understand that a Technology-driven idea with more mass appeal is what potential investors are looking for. If your business is not easily scalable across a wide market, higher margins cannot be reaped for the kind of money invested. It is always better that your product or service is appealing to all types of clients in the market.


Don’t bother if the business idea you are about to launch already exists in the market; let yours be unique and new. Think different is what I would suggest. WhatsApp is one great example for unique contribution to the android market, don’t you think so?

Make sure you are clearly differentiated from the others (e.g., better product, better value, different target client) and that your plan is SECURE against future market entrants who may try to imitate you after your initial success.


‘One thing at a time’ will be the mantra for startups where entrepreneurs have to concentrate on launching a single product at any given time. This will also help in giving clarity to those who work under you. Don’t try to be a jack-of-all-trades, but end up being a master-of-none without a laser-sharp focus to start.

4. Catch Hold of Investors even at an Early Stage:

First try to send feelers to whom you think as potential investors through the right channels. Say, you are a builder and trying to launch your first project. How will you make money rolling in to keep your project going? Either you go for bank loans – no bank will offer you big loans without proper recommendation, fund-flow projection  and collaterals or you need to pitch-in this idea to known circles to popularize your product and raise seed money by way of advance.

What I’m trying to highlight is that you need to bring in some initial investment which will help to keep the wheels rolling.

5. No Passion or Persistence

Your passion should be infectious enough to attract the right kind of investors. Not all are lucky like Matteo Achilli, the 20 year Italian student, who is about to launch a new social networking site in the lines of LinkedIn, called ‘EGOMNIA”.

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Tech giants like Microsoft and Google have already geared up themselves to support this lad in areas of marketing and cloud computing.

We should appreciate Matteo for his passion to create a networking site where job seeking professionals will be ranked and then directly connected to the employers. His persistence has paid off and he has been termed as “Italy’s Mark Zuckerberg”.

6. Failing to Form a Well-Oiled Team:

Let your team be like-minded persons with same objectives and working for a cause. Investors never will want to back-up a single individual, but a well-oiled team. Be courageous to put forward your ideas in an authentic manner. After all it is your own brain-child. If you don’t believe in it, who is going to?

7. Not Going for the Right Mentors:

Be surrounded by people who have already tested and tasted success in the market. Experience is like a seasoned teacher having solutions for all your questions.

8. Capture and not at an early stage:

Angel investors are people who are still doing serious business in the market and have the know-how of the market nuances. They are also ready to invest substantial amount in projects that seem to be worth the risk. On top of all this, you get to enjoy their mentorship all along the construction of your startup business.

In contrary, venture capitalists are private limited firms whose financial cap is very huge and they look for projects which are already up and running. Here you have the pressure of repayment and no mentorship.  Whether you are investing in your own business, or raising capital from outside investors, you need a clear roadmap.

Also See Popular LinkedIn Post: Top 5 Quotes on Passion and Persistence to Keep You Going