Why Do Startups Fail?

Posted by on Nov 9, 2011 in Business Models, Featured | 8 comments

The economy is bad.  I mean, let’s face it, financially things have surely almost never been worse on a global scale than they are right this minute, and it’s no wonder investors are hanging back watching the markets for signs of an upward trend before they get brave again.  You might think that in this uncertain climate, only a fool would think of launching a new tech startup now.  And if he did, the startup would be en epic fail.  This is not necessarily true, though – and the real reason startups are failing is the same reason they failed during the boom.  

People want to blame the lack of success among startups on the conservative and watchful attitudes of investors, but the truth is there’s still plenty of startup money out there.  In fact, many angel capital investors are aggressively seeking new firms to promote and help grow, not because they are afraid of the economic future, but to improve it.  Directv packages provide financial market programming around the clock, featuring the opinions of leading market analysts who take note of that fact.  What’s really behind the failures of startups has less to do with getting them off the ground than it does with keeping the momentum forward-facing as the startup progresses through the stages needed to see it through the critical early years.