2 Popular Problems That Lead to Startup Failure

Getting a startup off the ground is a real challenge. Keeping it running can be even more so. If you are concerned about your new company’s position in a competitive field, you should read through these two popular causes of failure: poor marketing and burning through money.


Poor Marketing

Statistically, one of the top reasons for startup failure is a poor marketing plan — approximately 14% of failures could be blamed on this issue. Many companies don’t invest a lot of attention or resources into their marketing plans, often assuming that their products or services will advertise themselves.

Even if your company is offering a product that’s completely revolutionary in the field, you should still make sure that it’s marketed properly. An amazing product isn’t worth much praise if no one purchases it.


Make sure that your company has a professional marketing team. You need to have a functioning website and social media platform that customers can easily access. And you need to have some sort of advertising campaign to get the product’s image out there because “word of mouth” isn’t enough.

If you want a greater guarantee that your efforts are working well, you can turn to a digital marketing analysis, reporting and insights dashboard like Morphio. The platform Morphio can expertly track online responses to marketing campaigns, finding changes in your website traffic and your competitors’SEO. If you have certain goals in mind regarding your customer audiences or ROI, you can set KPIs and watch your company’s growth using AI.

Morphio will do more than collect significant metadata. They will use the metadata to form lucrative insights about your company, pointing out vulnerabilities that need to be fixed and successes that can be further utilized. The dashboard will help youimprove your digital marketing intelligence and establish a strong online performance while freeing up your hard-working employees for other engaging responsibilities and tasks.


Burning through the Entire Budget

Spending too much funding on inappropriate resources is a surprisingly common reason for failure. One recent example was the used car startupBeepi — they had gained $149 million in funding and managed to blow through it in a short time. Company executives had incredibly high salaries. Some of the office furnishings were unnecessarily luxurious, including a sofa valued at approximately $10,000.

Instead of creating a sustainable budget for salaries and office equipment, Beepi spent more money than they could make. After a large investor pulled out, the company had to lay off the entirety of its staff.


Burning through money doesn’t just lead to trouble with investors — it causes trouble with their employees. The company Fresco News had difficulties with their budgeting practices and had to delay payments for their staff members regularly. Not prioritizing their staff payments resulted in high turnover rates and a poor reputation.

Knowing the causes of failure for previous businesses shouldn’t discourage you from pushing forward with your own. If anything, it should encourage you to create a better business. By learning from the mistakes of other companies, you can help yours gain long-term success.