Why tech start-ups fail?

Why tech start-ups fail?
In general, Start-ups have been created with a great vision and emotions to convert a tiny organization to larger one catering customers worldwide. However, only a few start-up success stories are inspiring while countless start-ups fail in no time. So why the start-up fails? Here are a few common reasons for tech start-up failure.

Lack of domain knowledge

Tech Start-up focuses on the development of web or mobile solution cater to the specific customer segment. Many times core team do not have enough knowledge about end-user needs or target market. This leads towards creating a wrong product roadmap just on the basis of assumption and hence the final solution is disastrous. In the initial phase, it is very difficult or even rare sometimes to hire an expert with detailed knowledge of the domain.

Recommendation

  • Start development with whatever known using an existing team/resources
  • Emphasis on iterative development (1-4 weeks)
  • Demonstrate enhancement to end users at the end of every iteration
  • Get feedback from at least 3-5 different users and take their opinions about features, usability experience, performance, and design
  • Plan next iterations basis on end-user feedback

Slower and in-frequent product delivery

Start-up mindset is having lots of ideas and excitement to deliver them quickly without proper research of end users’ need. Excitement creates improper planning, wrong pressure among the team and that leads to poor quality product. In the competitive era, Product-delivery with constant speed is a new strategic weapon and a key differentiator in business success.

Recommendation

  • Achieve the high level of Automation through DevOps
  • Bring agility among team members
  • Iterative planning
  • Focus on high business value features. Remember that only 20% of features are being used frequently

Technical debt

Technical debt is a term which reflects that extra work arises because of improper implementation of code by the team instead of choosing the best solution. Few reasons behind technical debts are Lack of skills, Extreme delivery pressure, Understanding gap and Lack of collaboration

Recommendation

  • Automatic code monitoring for Coding standard, Cyclomatic complexity, Code duplication
  • Implement test automation
  • Stick to Iterative planning & no change within it (1-4 weeks)
  • Emphasis on refactoring of code on regular basis & make it as a part of Definition of Done

Time to Market

Time to market is a critical factor for start-up success. Focusing on value creation from the Day 1 is crucial for any start-up.

Recommendation

  • Focus on high business value features. Remember that only 20% of features are being used frequently. Put your money and energy toward making them perfect
  • Implement DevOps to accelerate idea to production at least 30x faster

Ignoring the actual Customer need

A good product idea and a strong technical team are not a guarantee of a sustainable business. To meet end-user need should be the key objective of any start-up. Many times start-up founders think that they know what the customer wants or expects, so they only focus on their passion to build the product and the end user only gets it in their way not like what they want.

Recommendation

  • Regular interaction with end users at the end of every iteration
  • Get feedback from at least 3-5 different users and take their opinions about features, usability experience, performance, and design
  • Plan next iterations based on end-user feedback

Too much emphasis on raising money

Raising money is a very time-consuming job. It is a full-time job top of building your business. Start-up founders should ask this question to themselves, Is it really worth to spend your time and attention on raising money from the beginning of startup? Focusing too much on raising money can take away your focus from what really matters to your business.

Recommendation

  • Focus on value creation

Quickscrum is one of the fastest growing companies focusing on agile tools – Scrum, Kanban, and DevOps Implementation. Talk to our experts to implement Agile and DevOps for better collaboration and productivity.

 

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