Like any other growing thing, a startup also has a life cycle. It may require a long time to establish and develop well. No one will know where its life cycle finishes. Basically, there are 6 stages for a startup to establish well. I’m sure, there will be obstacles in developing each phase. In fact, 90% of startups fail in the second year. What are the main reasons for its failure? Let’s have a look into these points:
- 42% of the product is not what market need
- 29% of the company ran out of cash
- 23% of the company hires the wrong team
- 19% of the company gets out-competed
- 17% the product is not user friendly
- 14% lack of marketing strategy
- 13% of the product is in the wrong market
Knowing what are your main problems is essential. It can help you to define things that make your business down. Furthermore, you can check your startup stage.
Stage 1 — Concepting
You just create the concept of your business. You already research your target market and think about your product or service in that market. Research in hand, create a business plan and mission statement. Set goals for your development over the coming years.
Stage 2 — Commitment
You begin to build an MVP. In this stage, you create a prototype, develop a process, and start building a team. You have enough funding, and you’ll try to secure it. Then, you continue to refine your business model.
Stage 3 — Transaction
This happens in the first year of your startup. You will find your fit target audience. You begin to worry about your product and service. Try to gain as many audiences as possible and push the transaction activity. At this stage, focus on growing your customer base and actually attaining the product-market fit you researched earlier.
Stage 4 — Refinement
In the refinement stage, typically year 2, you are receiving — and soliciting — feedback from early adopters. Refinement also means refining your process, making it more efficient. In this stage, you can track and measure your website and social media performance or other data that can analyze your business performance.
Stage 5 — Scaling
Scaling ups startup can be processed in the second or third year. You can grow up your project due to customers’ feedback and market opportunities. Several tips that you can do in scaling your business is to optimize the marketing strategy and support your team.
Stage 6 — Established
This is almost the end of your startup journey. This stage is typically in the three years after. All you need to is retain your existing customer, increase the loyal customer, develop a marketing strategy.
Running a business is like planting a tree. It can’t grow instantly in a short time. It takes several processes. Just enjoy every stage of it and be open to the opportunity and market’s feedback. Sometimes, startup owners close their eyes and don’t listen to the team and customer. They just focus on the product’s development.