61–70 of 77 posts
Are these really "mistakes" or are they just the random process of value discovery, which naturally involves a lot of failures. Finding product-market fit is not something you can engineer with perfect foresight. You raise money, you build something, and then you have a limited time to see whether your hypothesis about the market was correct. Often, if not most of the time, you fail to get the fit you need in order t…
Hey HN. Founder of Failory here. Thanks so much for the positive & constructive feedback on the post. We aim to keep publishing more of these researches in order to make it possible to learn from other startups' failures. If you have any comments or feedback, you can drop me an email at nico[at]failory.com.
Do you have a breakdown of "Common Reasons For Startup Failure" by total funding amount bracket? Is there a trend?
Are these really "mistakes" or are they just the random process of value discovery, which naturally involves a lot of failures. Finding product-market fit is not something you can engineer with perfect foresight. You raise money, you build something, and then you have a limited time to see whether your hypothesis about the market was correct. Often, if not most of the time, you fail to get the fit you need in order t…
> You raise money, you build something, and then you have a limited time to see whether your hypothesis about the market was correct. Or, you get to know an industry, see a need, design a solution, bounce your ideas off people in the industry, do some mock-ups to get some initial acceptance of the idea, ask if they'd pay for it, and if/when all that comes together, then start to build. If you cannot build it with you…
These retrospective analyses, while intriguing to read, should be taken as more descriptive than prescriptive. When you talk to someone who actually succeeded at something, they'll talk about platitudes like working hard, product market fit, iterating, listening to customers, raising a lot of money or not raising too much money, and so on. Many people go so far as to try to emulate the behaviors of their "hero" (Jobs…
I have worked for some companies that were total failures and some that were global successes. Having been through the failures first, I was excited to see how the magic worked at a massively successful company, but to be honest the differences are more subtle than anyone would believe. The big successes were happy to do things that had been disastrous at other companies in my experience, and did not pay much attenti…
Google firing all of its managers early on in its existence is a great example of this.
Earlier quoted context omitted.
> You raise money, you build something, and then you have a limited time to see whether your hypothesis about the market was correct. Or, you get to know an industry, see a need, design a solution, bounce your ideas off people in the industry, do some mock-ups to get some initial acceptance of the idea, ask if they'd pay for it, and if/when all that comes together, then start to build. If you cannot build it with you…
Works well if your startup is filling in a niche within an existing industry. Does not work well if your startup is creating a new industry. There is a reason why the failure rate for the latter situation is abysmal. But that is also the reason why the returns are so large and sought-after for that situation.
Earlier quoted context omitted.
Random process of value discovery? This is entitled Software developers assuming they can jump into a completely different domain and instantly succeed. Sales? Fundraising? Business development? Operations? Logistics? Recruiting? Psh those losers make half of what I make I can do all their jobs at once no problem! Oh wait this is hard and I’m not good at it I’m going to wonderful journey my butt back to a cushy ad co…
I think you totally misread the comment. The process of value discovery involves all the business, ops, marketing, etc people you're talking about (they would be hired with capital or equity). No one is saying they can do it on their own.
Earlier quoted context omitted.
I have worked for some companies that were total failures and some that were global successes. Having been through the failures first, I was excited to see how the magic worked at a massively successful company, but to be honest the differences are more subtle than anyone would believe. The big successes were happy to do things that had been disastrous at other companies in my experience, and did not pay much attenti…
Andy Rachleff, known for his articulation of product/market fit, says a company with a lock on product/market fit can do almost everything else wrong and still succeed. Google firing all of its managers early on in its existence is a great example of this.
Earlier quoted context omitted.
I think you totally misread the comment. The process of value discovery involves all the business, ops, marketing, etc people you're talking about (they would be hired with capital or equity). No one is saying they can do it on their own.
Startups that have good business, ops, marketing, etc people don’t fail in the first place.
I remember digging into the source material used in this article, and contacting the founder, not Nico, but the other gentleman, can't remember his name, an amicable friendly chap. Anyway, I said to him, that a lot of the founders, although I respect their transparency and willingness to talk about unfortunately failing, they appear blinkered to the reasons for their failure. I won't mention the founders reply. Looki…
Really confused by the last paragraph, what's a bad decision? Are you saying 1. focus on growth, automation and selling in person Or 2. focus on retention, learning, and automating sales Both of which seem inconsistent?
I am saying, and I will elaborate:
1. Focusing on growth instead of retention in the early stages and certainly before PMF or at least strong indications of PMF, is a bad decision.
2. Focusing on automation and attempts at operational efficiencies when it comes to marketing and sales, again before PMF or at least strong indications of PMF is a bad decision.
When it comes to growth, automation and attempts at operational efficiencies, you do that when there are strong signals. You don't cut out selling in person, till you have an acceptable closing rate. Even then, I would still recommend frequent selling in person to learn more until there are diminishing returns.
Instead, you'll find an inordinate number of founders attempting to attain double-digit growth while there is triple digit churn. Automation of certain things like scraping lead lists, when the lists are nothing more than dump lists.
Hacking things out, when what they should learn is discarded because the process towards the end-goal cuts out what they need to learn, take on-board and become intrinsic.
Throwing up websites that are clones of well established competitors. Parroting without any deep understanding of why those things are on the site, of why those things need to be said. Oblivious to why they themselves are not in a position to say those things.
I would really like to say more on this. I would call it a pet-peeve, but I got a zoo full of them. If you want to carry on the discussion in private, happy to do so, but for now, I got work to do.
Cheers, Ace.
Earlier quoted context omitted.
Works well if your startup is filling in a niche within an existing industry. Does not work well if your startup is creating a new industry. There is a reason why the failure rate for the latter situation is abysmal. But that is also the reason why the returns are so large and sought-after for that situation.
Why doesn't this work for new industries?