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Why Do Some New Businesses Succeed – and Some Fail?

Nobody starts a business expecting – or wanting – to fail. Every single entrepreneur goes into it full of steam and vigor, wanting desperately to succeed. But, so many of them don’t, and the question is – why? Are there essential reasons why some new businesses succeed, while others fail? Here is what research on the subject has found:

Why Some Businesses Fail

  • Entrepreneurs take advice from people that they shouldn’t (not in the business or industry, no real experience, etc.)
  • The entrepreneur lacks focus.
  • The entrepreneur doesn’t have a good mentor.
  • There is no real passion, motivation, or commitment on the entrepreneur’s part.
  • Too much money is raised too quickly.
  • General lack of knowledge in operations, marketing, and finances.
  • The product is poorly researched and poorly executed.
  • There isn’t a market need for the particular service or product.
  • Too much competition in the industry.
  • No real business model for the product or service.
  • Customers are not valued enough.
  • Marketing is subpar.
  • The price of the product or service is too high.

Why Some Businesses Succeed

  • The team is committed to staying the course, and sticks with the pre-determined path.
  • Leaders of the company have general and industry-specific knowledge.
  • Founders want to see a “change” – and are committed to getting it.
  • The leaders know how to formulate healthy and productive mentor relationships.
  • The team learns, listens, and observes everything in their business and in the industry in general.
  • The team has superior persistence and patience.
  • Leaders adjust when necessary – but not continually.
  • Just enough money is raised to take the business to the next level.

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Published on: March 1st, 2017