5 Ultimate Reasons Why Most Startups Fail Within 3 Years Of Operation :A Beginners Guide

 According to Raphael Matu, Economist, financial advisor and an entrepreneur,many people get into business without a clarity about their objectives and as a result, about 80% of startups fail before they manage to get to their 3rd Anniversary.




Based on his research,here are the 5 ultimate reasons as to why most businesses fail:


  1. Lack of resilience -most individuals get into business with a wrong mentality, hoping for their business to realize gains after a short period of operation.The reality is quiet contrary,it is important for every business owner to remain resilient for a stipulated period of time before he can realize gains.Some can take upto a year before they make their first profits but it's really crucial to remember that,just like a job ,a business is also difficult to start and operate, it's theirfore your responsibility to choose your difficult.
  2. Getting into a wrong business -most individuals get into business for wrong reasons,just because your friend is operating the same kind of business profitably in the same locality doesn't quaranteed you success as a startup, always consider your dreams,goals, objectives and aspirations before indulging in any kind of business.
  3. Importance of Capital in business -it is not really a recommendation for a small scale business owner to indulge himself in bank loans with an aim of using the amount raised to scale his business.Reason being, their is no assurance that the business will perform according to the way he had protected it should be before borrowing the money.After a short period of time,most businesses owners get their businesses owned by banks or completely dissolved due to bankruptcy.It is theirfore advisable for every startup to raise Capital using recommended, user-friendly ways such as through his own savings,contributions from friends and relatives or sale of some high income owned assets, acquiring a loan as a startup is really not a recommendation because of it's potential stratagem.
  4. Inability to set clear goals and objectives --it really tried that most people get into business to make profits.It's really mind blowing if someone convince you today that he is getting into a certain business with a main focus of making losses.This is really unusual,of course you will tend to ask yourself questions like, "Indeed their is something wrong to this person's Medulla Oblongata",everyone wants to make money alright.This is where we now get it wrong,if we are so preoccupied with making money,we tend to loose focus on our main objective as a business.It is really fundamental for every startup to focus on solving a particular need or problem objectively,then money will just pour into your pockets automatically.
  5. Commandment of exit-Every business owner must have a clear exit Strategy, ability to liquidate his business into money with an appropriate timing,you should always follow the big players in the game, entering when they are doing so or exiting when they are also exiting.


#business #discipline #entrepreneurship #resilience #Goals #aspirations #BusinessObjectives


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