Faisal Hourani, Founder at WebMedic shares the following on Quora Digest:
Over 80% of startups fail because of one reason really.
The startup is built on the wrong assumptions.
The worst part? They don’t even know it’s an assumption.
To the founders, it’s a true fact of life and how dare you challenge it.
Majority of the reasons there are:
• No market need
• Running out of cash
• Pricing/cost issues
• Poor product
• Product mis-timed
• Pivot gone bad
• Failure to pivot
Are related to one main issue:
Startups are built on the wrong assumptions.
Why would you launch a product that has no market need?
Because you didn’t test your offer with potential customers.
Why would you run out of cash or have pricing/cost issues?
Because your assumption on what your customers are willing to pay was wrong.
Why would you have a poor product?
Because you didn’t build it with the Customer in mind, only your ideas.
Why was your product mis-timed?
Because you didn’t get real Customer Feedback or enough of it.
The solution is really simple:
Go out and talk to your customers.
Figure out what works for them and build something they would use, not what you believe they want.
Then why aren’t most startups doing it?
On a high level I think it’s ego, you want to believe you are right and willing to go all in.
If you zoom in I think it’s based on lack of proper education, misguided by all the news on overnight success stories.