Top 20 Reasons Startups Fail

The Top 20 Reasons Startups Fail

“From lack of product-market fit to disharmony on the team, the reasons for startup failure are abundant.  After analyzing 101 startup failures, the number one reason cited for failure in a whopping 42% of cases was tackling problems that were interesting to solve rather than those that served a market need.” – CB Insights

Excerpt Source:

Last Updated: October 27, 2023

After compiling a very long list of startup failure post-mortems, one of the most frequent requests was to distill down the reasons for failure from all these posts (a tall order, my friend!).

Startups, investors, economic development folks, academics and corporations all wanted some insight into the question:

“Are there a few primary drivers of startup failure?”

So CB Insights gave those post-mortems their special data treatment to see if we could answer this question.

And so, after reading through every single of the 101 postmortems, we’ve learned two things:

  1. There is rarely one reason for a single startup’s failure.
  2. Across all these startup failures, the reasons are quite diverse.

Once we sifted through all these post-mortems, we identified the 20 most frequently cited reasons for failure.

Since many startups offered multiple reasons for their failure, you’ll see that the chart highlighting the top 20 reasons doesn’t add up to 100% (it far exceeds it). Following the chart are an explanation of each reason and relevant examples from the postmortems…

[read the full article at]

P.S. If you are a startup founder or entrepreneur, and the above makes sense to you (or if you’ve read it carefully and burned these lessons into your brain, or you’re well on your way to bringing your Big Idea to market), but you’re burning a lot of time looking for useful, affordable startup resources, look no further.

As a startup marketing agency, we here at HypeLife Brands have compiled this handy list of the Top 30(ish) Most Useful Resources for Startups.

The list includes tools and resources we use every day for our clients (seriously), so if you’re still bootstrapping your way along, you’ll find this list immensely helpful. It’ll also save you HOURS — well, DAYS — of hunting, searching, trying, failing, and so on. The list includes affordable startup business insurance, stock photography resources, easy-to-use social proof for startups and their websites, awesomely affordable digital telecommunications options (no, you don’t need a $5,000 PBX system to get going), and more.

Plus, we’re constantly updating it as we find sweet new tools and useful resources. Sound good? Check it out, and thank us later. 😉