Advice to Startup Founders: Prepare to Fail

#News(General) [ via IoTGroup ]

For as long as technology startups have been spectacularly on the rise many more have been spectacularly in decline.The startups that we consider successes are in many cases born out of defeat: Slack for example started as a gaming company making a multiplayer game that few people wanted to play.

People problems.Product problems.How should startup founders avoid these many threats?

The venture capitalist Lak Ananth offers unconventional advice: Don’t avoid failure.Ananth is a managing partner of the venture capital firm Next47.His new book Anticipate Failure suggests that startups fall short for seven common reasons: problems with the product with the technology with the team timing business model customers or execution.Ananth uses these frameworks to analyze some of the more salient startup flops in recent years including Quibi the Essential Phone and Bird scooters.Bird for example captured the right market interest with simple technology.

But its business model faced some fundamental problems: Its founders had failed to account for the cost of maintaining the scooters.What originally looked like a profit of $2 a day on each scooter Ananth writes turned out to be a loss of $6 a day on each.(Ananth says nothing of startups like Uber which continue to bleed money.)Andreessen Horowitz partner Andrew Chen argues that the line between success and failure often comes down to getting “all the right users and content on the same network at the same time.” Launch too early or target the wrong people and failure is likely.His new book The Cold Start Problem explores how these network effects could be the difference between your startup being the next Instagram or the next Hipstamatic.Like Ananth Chen is a venture capitalist.He also worked on the growth team at Uber a startup he studies at length in the book.On its face the concept of network effects is simple: The more users who join an app like Uber the more money there is to lure drivers.But in reality most

Read More..
AutoTextExtraction by Working BoT using SmartNews 1.03976957683 Build 04 April 2020