Reasons for startup failure even after successful app development

App Development: Indian startups have grown exponentially over the past decade. India is said to have the third-largest startup ecosystem after the United States and China. Hence, Indian startups still continue to attract a lot of foreign investors to put their funds in.

Looking at the successful startup stories, Indian startups stand out with their profit and popularity like Flipkart, Inmobi, Swiggy, ByJU’s, Ola, and many more. Also, if you look around, technology has become the base for any startup to be called a startup. India soley has about 9300 tech startups. Digitalization has also led to many tier 2 and tier 3 cities to participate in the process of innovation and development. Startup India initiative by the Government of India has also led to build startups and nurture them.

Through this initiative, the Government plans to empower startup ventures to boost entrepreneurship, economic growth and standardized employment across the nation. The Government’s action plan to accelerate the growth of startups throughout India and across rural and urban areas including promoting entrepreneurship among the women and underprivileged classes. Startup India will focus on minimizing hindrances and promoting faster growth by handholding, funding, incentives and industry-academia support.

According to Gartner, less than 0.01 percent of all consumer mobile apps will become financially successful throughout 2018—yet apps continue to be a common development goal and product focus for new and aspiring entrepreneurs. The three common reasons for startups to fail is that the use of apps brings expensive in the development phase, the manpower required. Google Play or Apple store offers a customer plentiful of free apps.

Of all the strategies followed by the successful startups the four key principles all startups follow are providing quality time to the startup, focusing on the sales and development, and obviously start to hire the right resources. These steps obviously lead the startups forward but, after taking all the necessary steps, many startups still die down or break at some point or the other. There might be many reasons for startups to not succeed in the epitome of their success. Indian startup founders sometimes become completely clueless about why their startup is not succeeding and they tend to take wrong steps in frustration and loss of funds. Of the many known plans taken forward to initiate ahead, there are few basic and simple things missed in the earlier stages.

1. Confusing a business idea to startup – App Development

reasons for startup failure even after successful app development
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Many times, founders mistake a business idea to be startup innovation. This generally happens when the founders are not done market research or even have not understood their plan to start a startup. The idea of a startup is generally seen as a profit-making platform. Many youngsters also want to establish a business because they are very frustrated with their office environment and hence, a business idea becomes a startup and they start calling themselves as Entrepreneurs.

2. No Market Research

These days many startups start their organizations on the basis of the basic or initial funding they own by themselves or from their family. These startups take shape from the office workstations or from college canteens without much understanding of the market needs. The founders often assume their idea to top the market as they would do primary research in their college or office or among friends. The market research in such cases is even to a negligible level. In the beginning, though the startup gains popularity due to word of mouth, it does not succeed further due to a lack of in-depth market understanding.

3. Hurried Decisions to move forward

Startups tend to hurry up the process of growth once they see their first line of profit. The hurried decision to start investments on the things which was earlier planned for later stages actually takes place in the first and second quarter in itself. The profit margins though at positive stress to further push and get more development work done. But, it also stops the founders from thinking of future goals. They get a restricted current mode of work and become very money minded.

4. Relationship with the Co-Founder – App Development

Relationships are always crucial for human beings. And more so, when it comes to founder and Co-founders relationship in a startup, their healthy relationship adds up to the wealth of the organization. If the founders of a startup only work on the basis of agreeing to disagree with the concept and actually don’t pay much attention to the time and effort each of them individually put on the work done. Then the workplace becomes ineffective and inefficient. The founders who are aligned to each other on crucial decisions, can neither move ahead as individuals nor motivate their teams with half baked ideas to lead forward.

5. Lack of Funds

Any startup or business runs with a basic interest to earn profits. Once the profits maximize and the demands increase, then there is a clash. Many founders start using their company funds for personal usage without keeping track of the same. It would start with ordering lunches, to flight tickets and lead to almost bankruptcy. In such a situation, the startup loses its concentration of making profits and drops down to ensure that at least the startup runs without any cliche. However, such situations are very rare, until backed by an investor without returns and then fails.

6. Taking “Ignorance is bliss” too seriously!

It is absolutely crucial for a startup to know who they are standing in the market. Who are the national and international champions of the field they are getting into? They don’t take the competition seriously and hence, the other players in the market understand the gap and climb over the available space.

7. Being Eaten up by a Bigger Fish

The lack of knowledge in many startups ends up in a very sad note. The negligence and untimely attitude to their company leads them to be eaten up by a bigger competitor. This means, if a startup is willing to sell off the idea or innovation after a certain amount of growth, it works fine for that startup. However, your startup is your idea, your passion and when someone takes it away from you, a genuine startup surely will feel disabled.

8. Understanding the app features – App Development

Many founders don’t have an in-depth understanding of the app they work on. They are much dependent on app developers to do a greater job. However, the app developer including the UI and UX developer can’t envision the app as the founders and that leads to chaos. Also, the dependency might lead to app developers overpowering the founders and moving ahead to create their own apps copying the founder’s ideas. Hence, when you are choosing the developers for your startup, you should ensure that you bring only trustable employees onboard.

9. Lack of marketing tools

Many startups think that the app generation is the epitome of startup development. And keep neglecting the free available tools to aware, promote and collaborate with their target audience. This leads to lesser reach and more expenditure on app development. The branding of the brand is the soul of the app. The brand value should define the core values and distinguish your brand from others in the market. The other important thing is to keep SEO ready so that the app gets ample opportunity to grow. And this aspect is mostly avoided by app developers.

10. Content generation for the app

Content is one of the vital aspects of any organization. And once there is a new app, the basic technical details should be led down properly. It can’t be done for the heck of it. Most of the users want to know what they are about to use. With tech-savvy startups, the customers and users have also gained technical and technology knowledge to understand the app. A good content expert is an essential position that every startup should have filled. Investing in content can help the company reach a wider audience in the best possible way.

11. Being stealth for long

Startups are after app development either hurry up or keep quiet to ensure some traction and then approach investors outside. However, staying stealth for longer can lead to a dying startup. So, stakeholder inputs are really crucial at the right time to make the startup reach their goals. The founder should be able to differentiate between a piece of good advice and great advice from the stakeholders.

12. Team Issues

Once the founder has decided to develop an app with a particular group and (s)he is confident of it. The lack of preparedness for team breakdown or any team member moving out will absolutely impact the further process. The founder should always be ready for challenges that might arise from the team. This might be foreseen challenges or challenges that just come out of the blue. The founder should have the mindset to set everything correct.

13. No Plan B

In any kind of business or startup, we should always have a way out. If plan A fails, then at the very stage Plan B should be able to accommodate and run the show. This ensures that you are not forced to shut the office and go home when something is not just working for you at a particular point in time.

Every startup takes some time to understand the nuances of the strategy led out. But, the startups should abide by a few core principles to be successful startups. Let us discuss such principals in detail to make things clear

1. Quality Time

If a single founder, then you’re the most important part of the startup. If you’re solo, that means that for all intents and purposes, you are the company. Here, your health is the company’s health and your failure is the startup’s failure. The founders believe that the co-founders and employees align towards slagging the company. However, working late with no proper sleep, and coming in early the next morning doesn’t just affect your output, it affects the company’s output. Eating based on taste instead of energy output doesn’t just affect your focus, it affects the startup’s focus as well. The actual business comes from profitability, revenue, churn and growth, the tools that a founder uses to measure business impact founders and startup health. For example, if you want to eat junk on Saturday night and indulge in the gym on Sunday, prepare your business plan accordingly. But, it’s crucial to take care of a healthy startup.


2. Sales and Development

Accept what you are doing wrong. It is a common practice among founders to try to outsource tasks as they can shed their load and get some quick help, like offloading their app generation work, shedding loads of finances and accounts. This puts a lot of pressure on the current person in charge who neither has the depth nor the bandwidth to work with passion. This CFO now has to work full time doing what only took a small part of another person’s time. It is pivotal for a founder to stay focused. Sell only what you can build, and build only what you can sell. I see this sales-first focus over and over in fast-growing early-stage companies. Sales is one of the key factors observed in every startup without question.

3. Equilibrium

Founder should not sit idle at the office or a shared space, just being the owner of the startup. You need to be engaged and get your job done. Running full speed for six months only to quit from lack of sales or funding is much worse than running at partial speed for 12 months. Pat your own back, when you earn more profits and motivate the team, stabilize the startup, and eventually balance out personal finances too.

4. The Vision:

Founders are stuck after a certain point, that’s the time to decide the value proposition. For example, if a founder is completely focused on fundraising or an accelerator, then rather than wasting any time on a pitch deck, focus on sales and development in the first place. More than anything, remember to never give up. Don’t forget why you decided to start a company, what your goals are, and what’s at stake. As the founder, it is your responsibility that you always focus on the vision of the startup to make it big!

If a founder keeps these pointers in mind every time they face a challenge or revisit these points when they feel that they are lagging behind, then they can certainly avoid major damages to the startup. In-fact doing a rain check every now and then for the company is a healthy habit in the long run. There is no doubt that technology is a key factor in helping startups reach newer heights. However, founders should be aware of the fact that technology is not the only factor that is responsible for the startup to become a unicorn!

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