Why startups fail
There are a multitude of reasons why a startup might flop, and it’s tough to know who is qualified enough to give advice on the matter. Well, good news, folks, we’d like to introduce you to one of the top experts on this subject: Paul Graham. Meet the walking, talking venture capitalist/essayist/programmer/jack-of-all-trades who just might fund your idea one day.
Below, we’ve summarized his famous list of 18 startup mistakes.
First, if you’re launching a startup, time is of the essence. Be careful about dragging your feet – delaying the process might stifle morale and raise more questions than it can readily answer. Conversely, it is just as risky to jump the gun. We know you’re excited, but are you ready to pull the trigger? Make sure all your i’s are dotted before you cut the ribbon, or you’ll be scrambling to take care of last-minute details in the view of the public eye.
Does your startup have only one founder? He or she best make a friend or two, and fast – founding teams seem to have a higher likelihood of success. Is your location prime, or are you in the middle of nowhere? If you’re a hop, skip, and a jump from consumers who would be interested in your product, the word of mouth might get stuck in the mud (Hint: We heard Silicon Valley is nice).
And speaking of your target demographic, who are they? If you have a dynamite idea, but you’re not sure yet who will be interested, the harsh reality might be that the perfect group of people you plan to market to could not exist. *Cue eerie music*
Finally, let’s talk money
Rule numero uno: Don’t spend too much. That’s basic stuff. And you’re probably aware of the issues that could arise if you raise too little money to fund your idea. But you might not have considered the harmful effects of raising too much money.
If you round up $800,000 to develop a new low-calorie popcorn, it might go to your head and give you that big-shot feeling that could do an idea in before it even takes off. Money can be a dangerous thing – if you have a voice in the back of your head that is telling you to impress investors, remember that the user comes first.