Crucial Factors that will Make or Break a Startup

What do you think affects the Growth or Failure of a Startup?

Startup culture is on its heights at present. More than 100 startups are launched in the market every month with the motive to improve our lives and enhance our lifestyle. Unfortunately, the success rate is less than 10%. We can state this based on a collaborative survey report by the IBM Institute for Business Value and Oxford Economics, where it is mentioned “Despite India’s entrepreneurial strength, as many as 90% of startups fail within the first five years”. As per the report, the lack of innovation has been the main reason for the failure of an Indian startup.

The fate of the rest of such new businesses shut down because of the different factors like Team, Business Model, Business Financials, etc. Starting up something takes a lot of efforts and there are a lot of minor factors at play, that should be checked beforehand. These include knowledge of Market Conditions, Cash Funding, Legal understanding, Target Customers, New Technology, etc.

After studying the various factors involved in any startup irrespective of its audience and the type it is, here are few pointers that can either take your startup to the next level or bury down the ground.

Team: The team members of your startup play a significant role in any startup. Most of the startups fail because of the clashes among the core members. These clashes can be there because of any reason, it could either the difference of Business ideologies, or because of the vision, etc. You should make sure that you and your team should share a clear vision and goal for your startup else your startup could turn out as a nightmare for you. Every startup, irrespective of its size, has witnessed the bad and good times but the ones who survived in the market are the unity of their team. Along with this, the members of your team should work as the same energy level in the same direction else the chances of survival in the market is very less.

Financials: Financial security is another major area where startup suffers a lot. Initially, most of the startups are either backed by some angel investors, seed funds or investment of founders. The funds available to them against the business they are trying to build are very less, so the use of money should be done in a smart manner else it could be disastrous for you in the long run. The fixed costs associated with your startup should be minimal as much as you can. It includes rents, interests, etc. With the help of co-working spaces presently, a startup can minimize its fixed costs significantly.

Business Model: Your business model should be unique, It should not be copied, nor it should have any loopholes. Along with this, you should be flexible with your model too depending on the need and demand of the audience. Mostly, startups start with an idea but as time passes they keep on evolving and making changes in themselves depending upon the need of their customers. Along with this, you should be entirely convinced with your business model and the product or services you are offering to persuade others like the investors, prospective clients, etc.