Death of Startups: The Autopsy

Apr 25, 2013

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Posted In : General Marketing

THE DEATH OF A STARTUP

dead startup

Dashed Hopes and Dreams

How excited is an entrepreneur when he/she first gets started? Its a wonderland of possibilities for most and the hopes and dreams feel almost tangible as the entrepreneur contemplates their potential.

Hidden deep inside of each small business and the dreams of each entrepreneur is a code that, if followed, can produce dramatic results and realization of wonderful dreams. What is that code? What is it about the code, that the majority of businesses miss?

The Facts

  • At least 85% and maybe as high as 98% of new small businesses fail before they hit the five year mark
  • 70% of small businesses go broke before their 10th anniversary, according to the Small Business Administration

The Reason

The pundants will say that the reason for that failure is under capitalization and poor fiscal management. However, every successful marketing mind I have ever read disagrees in the most fundamental way.


Peter Drucker – Father of Management Theory and Business Consulting

“Because the purpose of business is to create a customer, the business enterprise has two–and only two–basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business.”

Michael Gerber – Father of Small Business Consulting

“Most entrepreneurs are merely technicians with an entrepreneurial seizure. Most entrepreneurs fail because you are working IN your business rather than ON your business.”

“The greatest business people I’ve met are determined to get it right no matter what the cost.”

“The true start-up of a business is what happens before you start-up.

“Contrary to popular belief, my experience has shown me that the people who are exceptionally good in business aren’t so because of what they know but because of their insatiable need to know more.

Dan Kennedy – Marketer and multi-millionaire

“I can point you to businesses that have failed with enough money to do everything they needed to do ten times over. And some management consultants will tell you its poor management ability. I suggest to you what it is in most cases is that the business owner decided that once he or she was in business they didn’t have to sell.


The Deeper Autopsy

By thinking of your current business, you need a barometer and a compass for guiding you to the next step of navigating the code for small business success.

We have worked with hundreds of start ups and small businesses over the past 7 years. We have so many case studies we could be shared but what we have found is that the primary reasons for small business and start up deaths include:

  1. Lack of Strategy: A model to operate from makes all the difference in the world. Most marketing gurus and small business gurus preach the idea of spending more time planning and envisioning so that execution is more efficient.
  2. Bright shiny objects: Lack of focus on strategy and plan previously developed and committed to.
  3. Lack of Research: Failure to conduct and operate from market research that reveals that their is a market and that you understand that market.
  4. Target Market: Failure to target, reach or connect with the target audience.
  5. Lack of Lead Flow: Failure to execute in a way that creates consistent and predictable lead flow is one of the main causes for small business failure. You must have enough people to talk to inside of your target audience.
  6. Lack of Systems: Systems through software or otherwise are key to the success and scalability and therefore the profitability of the small business sector.

Your Trajectory

By thinking of your current leads and the rate of which those leads turn into customers, you can accurately predict your potential upside in your business and its current trajectory. As an example, if you have more leads than you can handle, that is great to know. If you have a lack of leads but you close nearly every person that you talk to, that would be great feedback.


Model for Small Business/StartUps

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  • 5 Factor Diagnosis – With this diagnosis, we use our revolutionary marketing process to diagnose your current marketing and put a finite measurement to where you need to go from this very moment.
  • Free Initial Strategy – This service catapults Innovation Simple as a definite leader and provider of value in the marketing space. This approach and strategy session is un-duplicated in the marketing space for small business. Apply for a free strategy session by requesting a quote.



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