The document discusses 10 common reasons why startups fail, including founders not properly validating their business idea by solving customer pain points, underestimating the market size, lacking passion for their product, and not having the necessary skills or ability to recruit the right team. It also notes that conflicts between co-founders over vision, goals, commitment levels can cause 65% of startups to fail. The document provides tips for avoiding these pitfalls and increasing the chances of startup success.

1. 10 Common Reasons Why
Startups Fail?

2. 1. Most Founders think their idea is so excellent that they
should immediately build the product, show it to the
customers, and money will start coming in.
2. In truth, people are unwilling to try a startup's product,
because most of them fail to address their pain points.
People will only try products if it promises to solve their
problems which haven't been done by others.
3. Don’t start a company until you have the solution to the
identified pain points for which many people are eager to
pay to make their life simple.
1. Inability to discover unsolved client torment

3. 2. Wrong/ No Estimation of Market Size
1. Before starting any startup, it is very important to gauge the
market size estimates and potential.
2. Wrong or no market estimation can hamper your startup
progress and you may lose out on many important aspects
and startup valuation being one of them.
3. Right market estimation helps company define its mission,
vision, customer size, action plan and growth trajectories.

4. 3. Customer Insights & Segmentation
1. Segmentation process allows us to divide identified market
into different customer segments and help us to decide
which potential customer segments the company will focus
on.
2. Market segmentation allows a business to precisely reach a
consumer with specific needs and wants.
3. In the long run, startups grow fast because they are able to
use their resources more effectively and make better
strategic decisions to address the customer needs.

5. 4. Hesitance to get input on Prototypes
1. Many founders are hesitant to show their product to anyone else, Because,
a. They’re scared of someone stealing their idea and creating a similar product with a head
start
b. They’re anxious about the possibility that unless it's perfect no one would want to buy it
c. They want to amaze their peers
2. To avoid this issue, create a prototype which is inexpensive and get
feedback on it which can be useful inputs to improve your product because
failing to receive a feedback can lead to failure for the startup.
3. Prototype & Feedback process should be continued until your potential
customers demand your product.

6. 5.Lack of Passion for the Product
1. Don’t start an organization if your essential inspiration is to
make profit. Because to be effective, it takes around 80 hours
a week with next to no compensation to make your startup
fruitful.
2. It is unrealistic to work very hard and be effective unless you
trust that your life's goal is to improve potential clients off by
giving them your organization's product.
3. To be successful, direct start-up at taking care of an issue
that you think about profoundly.

7. 6. Founders don’t have at Least one of the skills necessary skills
1. Founders are not able to do the thing that needs most to get off
the ground. For example, the founder of a tech start-up does not
know how to code which is needed the most to get the company
off the ground & create a world-class product that will attract
customers.
2. Entrepreneurs increase their chances of success if they deal in
the industry that needs the skills or prior experience, domain
knowledge, they possess and are passionate about the same

8. 7.Ignoring the rate at which they burn cash-Ignoring Bootstrapping
1. Don’t start a company if you don’t have the required patience to
watch pennies in the early stages. Many entrepreneurs believe
that they will create a perfect product & amaze the world.
2. It’s a myth that start-ups easily raise funds & its believed that
they’ll be able to the same, which leads to the ignorance of the
rate at which they burn cash assuming that they would reload
their cash reserves when the investor will write them hefty
cheques.
3. Good entrepreneurs spend just on fundamentals & believe in
continuous networking to meet the investors so that they’re well
equipped with cash reserves much before they run out of cash.

9. 8.Difficulty in raising the necessary capital
1. Even if your idea or product is very good, It may take
many rejections to succeed.
2. To avoid money run out, entrepreneur should not waste
time in chasing the wrong group of potential investors or
present the wrong information that would get the
investors to invest
3. The capital raising approach is directly related to the
company’s development. Raising capital for the company
is like a full-time job which should be on track much
before the cash runs out.

10. 9. Inability to induct a “Crack Team”
1. A leader who cannot recruit the right team and motivate
them will result in the failure of the start-up as the
success of the organization depends on the team’s
ability to perform.
2. Its difficult to learn how to become a good leader. Also,
the skills needed to get an organization to 10 employees
are unique in relation to what a 100-man or 1,000-man
organization requires.
3. A good leader has the charisma & a reputation to induce
a convincing vision for the organization & select the right
team who understands this vision.

11. 10.Misalignments between co-founders
According to the research of a Harvard Business School
professor Noam Wasserman, 65% of startups fail because of
conflicts between the co founders.
These conflicts are results of;
1. Difference of vision, goals & values amongst the
cofounders
2. Level of emotional ownership for the company is not the
same.
3. Ego clashes
4. Difference in the commitment level of the cofounders

12. Build Grow
Remain
Competitive
M&A
Advisory
Agnostic to:
• Life cycle
• Size
• Scale
• Structure
• Vertical and
• Location
VISION: “We extend our insights, knowledge and experience for building and growing businesses
profitably”
D’Essence Consulting is a Management Consulting, Business Strategy and M&AAdvisory firm based in Mumbai since 1998
About D’Essence

13. What Do We Do? How Can We Assist You?
“We help our clients to capitalize on market dynamics and changing business landscapes to build into a
healthy entity ready to take on the future and unlock its market potential”
1. Validating your Business Idea
2. Enrolling Co-Founders and
Start Up Team
3. Learning to Boot Strap
4. Firming up the Business
Idea- Finalising the Business
Model
5. Firming up the Revenue
Model
6. Meeting Potential Investors-
Angels, Seed Funds
7. Analyzing Term Sheets and
Accepting an Investor`s Offer,
8. Scale Up and Execution
9. Opening Doors and Lead
Generation
Business Consulting
Services
Start-Up Consulting
Services
1. Market Sizing
2. Domain Report
3. Feasibility Study
4. Entry Strategy
5. JV’s
6. Strategic Alliances
7. Partners
8. Market Mapping
9. Product Competitive Analysis
10. Start-ups
India Entry Strategy
& Market Mapping
Investment
Services
1. M&AAdvisory
2. Target Search
3. Private Equity
4. Assistance in Due
5. Diligence
6. Valuation
7. Creation of
Investment Package
8. Post Merger
Integration
1. Corporate Strategy
2. Business Plans
3. Growth Strategy
4. Turnaround Strategy
5. Business & Revenue Modeling
6. Internal and External Audit of
operations
7. Improving efficiencies
8. Training
9. Marketing Strategy
10. Exit Strategy
11. Dashboards
12. Industry Reports
13. Benchmarking Studies
14. White Papers

14. “We are led by high energy experienced individuals having operating expertise and deep domain knowledge across verticals. People at D’Essence are driven by
accountability and performance”
Profile of Chief Consultant
Chandni Sahgal
PROFESSIONAL EXPERIENCE
1. Pritish Nandy Communications - CEO
2. MTV - General Manager India and VP Southeast Asia
3. Times of India, Times FM - Vice President
4. Cyanamid India - Marketing Services Manager
5. Novartis (Ciba-Geigy) - Assistant Manager Sales &
Distribution
6. Eicher Motors ltd. - Executive Finance and Projects
EDUCATION AND TRAINING
1. BITS Pilani. MMS (Honours)
2. Ciba-Geigy Japan-General Managers Training Kit
3. University of Toronto, Canada Fisher Graduate
Fellowship –Media & International Business
4. London School of Economics- Chevening Gurukul
Scholarship in Leadership and Excellence
5. Start-up Fellowship 2012 Leadership Program
MEMBERSHIPS
1. Institute of Management Consultants of
India (IMCI)
2. The Indus Entrepreneurs (TIE)
3. Indian Merchants Chamber (IMC)
4. Executive Forum
5. Consulting Base
6. Richmond Group- is UK's leading consortium
of independent certified management
consultants
D’Essence Team
Profile of Finance Consultant
Rajesh Chheda
1. Rajesh Chheda is a Chartered
Accountant and commerce graduate
with more than 10 years of financial
experience.
2. He handles the financial aspects of
the M&A transactions and also
handles the treasury and accounts
of he company.
3. He has wide experience of due
diligence related activities. He has
been with D’Essence for more than
nine years and has worked on
assignments covering various
industries.

15. Contact Us
D’Essence Consulting
303, Aar Pee Center,
11th Road, Gufic Compound,
MIDC, Andheri (E)
Mumbai- 400093
For further queries:
Chandni Sahgal
+91 9820075332
chandni@dessenceconsulting.com
URL:
www.dessenceconsulting.com www.mentorvilla.com www.businessplanvilla.com