Burned out Work-life balance is not something that start-up founders often get, so the risk of burning out is high. Burnout was given as a reason for failure 5% of the time. The ability to cut your losses where necessary and redirect your efforts when you see a dead end — or lack passion for a domain — was deemed important to succeeding and avoiding burnout, as was having a solid, diverse, and driven team so that responsibilities can be shared. What can make conversations about burnout difficult, especially in Silicon Valley, is the widespread belief that building a successful company will always involve some degree of possibly hazardous overwork. As former Uber board member and CEO of Thrive Global Arianna Huffington puts it:“The prevalent view of start-up founders in Silicon Valley is a delusion that in order to succeed, in order to build a high-growth company, you need to burn out.” Amid the pandemic, burnout became even more prevalent among tech workers: 68% of tech employees said they felt more burned out working from home, according to a survey by Blind. Various founders have spoken up about how damaging burnout can be. Former Zenefits CEO Parker Conrad said,“I think people are unprepared for how hard and awful it is going to be to start a company. I certainly was.” Didn’t use network /advisors We often hear about startup entrepreneurs lamenting their lack of network or investor connections so we were surprised to see that one of the reasons for failure was entrepreneurs who said they did not properly utilize their own network. As Kiko wrote, “Get your investors involved. Your investors are there to help you. Get them involved from the start, and don’t be afraid to ask for help. I think we made the mistake early on of trying to do (and know) everything ourselves, perhaps out of insecurity over being so new to the business world. This is a mistake.” No Financing /investor Interest Tying to the more common reason of running out of cash, a number ofstartup founders explicitly cited a lack of investor interest either at the seed follow-on stage (the Series A Crunch) or at all. Bad locations The reason start-ups prosper in some hubs is probably the same as it is for any industry: that’s where the experts are. Location was an issue in a couple different ways. The first was that there must be congruence between your start-up’s concept and location. Location also played a role in failure for remote teams. The key being that if your team is working remotely, make sure you find effective communication methods; else lack of teamwork and planning could lead to failure. Lack passion There are many good ideas out there in the world, but 9% of start-up fail due to lack of passion, post-mortem founders found that a lack of passion for a domain and a lack of knowledge of a domain were key reasons for failure no matter how good an idea is. Sacrificing users to(supposed)profit/Ignore Customer When I said at the beginning that if you make something users want, you’ll be fine, you may have noticed I didn’t mention anything about having the right business model. That’s not because making money is unimportant. I’m not suggesting that founders start companies with no chance of making money in the hope of unloading them before they tank. The reason we tell founders not to worry about the business model initially is that making something people want is so much harder. I don’t know why it’s so hard to make something people want. It seems like it should be straightforward. But you can tell it must be hard by how few startups do it. Because making something people want is so much harder than making money from it, you should leave business models for later, just as you’d leave some trivial but messy feature for version 2. In version 1, solve the core problem. And the core problem in a startup is how to create wealth (= how much people want something x the number who want it), not how to convert that wealth into money. The companies that win are the ones that put users first. Google, for example. They made search work, then worried about how to make money from it. And yet some startup founders still think it’s irresponsible not to focus on the business model from the beginning. They’re often encouraged in this by investors whose experience comes from less malleable industries. It is irresponsible not to think about business models. It’s just ten times more irresponsible not to think about the product. Loose Focus Getting sidetracked by distracting projects, personal issues, and/or general loss of focus was mentioned 13% as a contributor to failure. As My Favorites wrote on the end of their startup experience, “Ultimately when we came back from SXSW, we all started losing interest, the team was all wondering where this was eventually going, 6 and I was wondering if I even wanted to run a startup, have investors, have the responsibility of employees and answering to a board of investors.” Pivot gone bad The startup was one of the highest-profile competitors to top electric skateboard company Boosted, and last year announced plans to enter the electric scooter market — a push that seems to have doomed Inboard. Founder (and now-former CEO) Ryan Evans told The Verge his team had locked down ‘a very large order’ from ‘one of the largest European scooter operators,’ which explains why the company quickly pivoted away from trying to sell its first e-scooter directly to consumers earlier this year. But Evans said the development timeline for Inboard’s e-scooter ‘outstretched’ its financial runway.” After investors refused to inject more funds, the company was forced to shut down. For Frances Dewing, the founder of Rubica, a last-ditch attempt to save her cybersecurity startup from failure amid Covid-19 led her to pivot from focusing on consumers and small businesses to larger companies. In the end, the new direction
