Top 10 reasons why start-ups fail
By Kukil Bora, SiliconIndia | 7 Comments
Bangalore: Have you ever wondered what makes entrepreneurs a rare breed? It's because very few start-ups actually triumph in their endeavor. According to a research done by the U.S. Bureau of Labor Statistics, nearly six in ten businesses shut down within the first four years of operation. This is surely abstemious for anyone tempted to invest their time and personal savings into launching a new business. So what are the factors that turn out to be the obstacles in keeping a new business afloat in the perilous waters of the entrepreneurial sea? Mentioning below are the top ten reasons that, if not avoided, can sink a start-up. 1. Ignoring customer feedbackFor most start-ups, tunnel vision and not gathering user feedback are fatal flaws. If you ignore your users, it will be a tried and true way to fail. Listening to your customers, and more important, acting on the feedback they give is one of the best ways to transform a struggling business into a successful one. Customers are ultimately the ones responsible for the company's paycheck. By listening to their needs and desires, you can tailor your product and service to better meet their demands. 2. Poor managementIn most cases, new business owners don't have relevant business and management expertise in key areas like finance, purchasing, selling, production, and hiring and managing employees. It can soon lead them to a disaster. Poor management also results in poor strategic thinking. To avoid that there should be a regular study, planning and controlling of all the operations of a start-up. A successful manager is the key element in a successful company, because he or she is responsible for creating a work climate that encourages productivity.