5 reasons why startups fail

From market research to funding, today we will dismantle the top 5 reasons for startup failure. At HEMEX we have seen many cases in our years of experience in this field. For this reason, we hope to give you some hints to look out for while navigating the ever-changing startup ecosystem.

Launching a new venture is not all about the founder title, the “be your own boss,” or the power is in your thoughts philosophy. The real truth is that starting a business is a lot harder than most people think and entails mastering and successfully handling different issues simultaneously. Legal, financing, intellectual property, sales and marketing, human resources, and a very long list! It can be literally a roller coaster.

Besides, most startups don’t succeed. Guy Kawasaki said it himself; Ideas are easy, implementation is hard. There are different studies with different data, but the consensus everywhere is that most startups fail. More than two-thirds of the startups never deliver a positive return to investors[1], just under 50% of startups make it to their fifth year[2], and the statistics go, unfortunately, so on.

Nevertheless, nothing could be further from our intention than to discourage you. There are ways to work it out. Moreover, at HEMEX, we are committed to guiding promising startups through every step of their journey. That’s why, as startup experts, we believe it is important to consider the big picture and don’t underestimate the ecosystem once you start dancing with it.

Therefore, here are our top 5 reasons why we think startups could be in danger of failing:

  1. No market – No buying customer 

A more throughout market research needs to be done. It is essential for the future success of your business idea as you needs to understand the market need for the technology.

  1. Issues within the team – Not the right team

Make sure you have the right people on board. You need brilliant people who are motivated and dedicated to bringing your product/technology further.

  1. Not enough focus – Having too many things in the pipeline

Focus on one solution in greater detail first. It’s important to set priorities to decide whether something is worth pursuing or not.

  1. Strong competition – Get outcompeted

Once an idea gets market validation, there may be other entrants in the market. One needs to make sure not to ignore the competition.

  1. Eventually, not getting the funding

As a result, of the reasons mentioned above and many more, the startups eventually don’t get the funding and will find themselves in trouble finding the funds.

If you are unsure you might be stocked on any of the points mentioned before, be aware! If you feel like you need help, contact us right now! We can help you get out of any of these rabbit holes.

And we will make sure that together we have a hell of a ride on your start-up’s roller coaster!

Let’s speak today



Sources: [1] Harvard Business Review, [2] Review 42

Background photo by Daria Nepriakhina 🇺🇦 on Unsplash


HEMEX is committed to changing the future of healthcare by guiding the most promising European startups through each and every step to bring innovative pharmaceuticals, medical devices, and in vitro diagnostics to the market. Headquartered close to the thriving Basel global Life Sciences hub, the goal at HEMEX is to ensure startups have access to a wide range of tailored products, practical solutions, and fundraising support. This empowers the next generation of transformative discoveries to grow into successful and sustainable businesses, and drive change in both human and animal healthcare. For more information, visit https://hemex.ch/