A great piece at CB Insights. They collected the failure stories of 101 startups and then broke those failures into 20 categories.
Here are the top 10 reasons for failure, as compiled by CB Insights.
What I find interesting is that 8 of the top 10 reasons are marketing related.
- No market need.
- Get outcompeted.
- Pricing, cost issues.
- Poor product.
- Need, lack, business model.
- Poor marketing.
- Ignore customers.
- Product mis-timed.
Across the cultural divide
Tech founders tend to be techies, and techies tend to have a problem with folks of the sales/marketing persuasion. One problem is that many marketing people don’t really understand the technology they are marketing, which means they can’t be full partners to the tech team.
Another problem is that marketing people tend to be well-versed in the arts of persuasion. If the marketer takes a position, especially in regards to technology they don’t appreciate, they can easily steer the startup in the wrong direction.
Plus, every techie has a story where they’ve felt misled by a sales or marketing person, and that anger or regret can bleed into professional relationships in a startup.
Finally, techies rarely have a handle on what to look for in their marketing hires. Based on more than 35 years experience, StorageMojo has a suggestion.
The StorageMojo take
My sympathies are with the engineers when it comes to their feelings about marketing. As I said in the link above:
Theyâ€™d get flayed for every decommit and slip. Theyâ€™d sweat blood figuring out solutions to hundreds of subtle problems.
Then, after 2 to 3 years of effort, theyâ€™d deliver the product to marketing and, all too often, watch their hard work go for naught.
Maybe marketing missed some key features. Didnâ€™t position the product properly. Training failed to equip the field. Mis-pricing. Tougher competition than expected.
That last paragraph captures many of the issues that CB Insights survey did. Which shouldn’t be a surprise.
Startups exist to sell a product. Development is only a means to that end.
Courteous comments welcome, of course. Disclosure: I offer services to help startups with every phase of product development.