Why do most of the startups, whether launched by an IITian or not, fail miserably? Which ones really became successful? What are the reasons behind this?
This was an interesting question that came from an online forum. Those who study startups agree that over 90 percent of startups are bound to fail. Check out our listing of recently failed startups Response from our editor follows:
This is an interesting multi-part question. So let us look at the individual questions
- Question: Why do most of the startups fail miserably?
Empirical data indicates that 90–95 percent of startups fail. Startups fail for varying reasons including
- Ideation or lack of ideation – Idea is great, but ahead of time, Field-of-dreams – Entrepreneurs hope that they will build it, and customers will come. Some entrepreneurs are in a rush to get a “product” out without checking on the viability of their Minimum viable product (MVP)
- Lack of resources to sustain a business – Many startups fail when they run out of resources.
- Lack of a plan or business model. Startup or not, a venture needs to sustain itself
- Founders lose motivation, energy or interest. This happens more than most of us realize. Why? Because sustaining a startup is a marathon, and not a quick sprint.
- Some founders don’t want their baby to grow up into a business (ref: )
- Question: Which ones really became successful? What are the reasons behind this?
Facebook, Google, Microsoft, and even HP and most other multi-billion dollar companies we love and admire started as startups.
The reasons for success are as varied as one can imagine – Vision, great idea that came to market just-in-time, hard work, and some serendipity (luck?)
Googled Image of Garage where HP started as a “startup”
- Why do startups “launched by an IITian ” fail too?
The question assumes, perhaps rightly, that IITian bring drive and intellect to a startup. However, a startup is successful (or fails miserably) due to various factors.
Sheer intellect and drive of the founder is just one of the ingredients. So if one discounts this factor, even startups launched by IITian might fail for the same reasons as other startups.