Why Do Startups Fail?

One of the greatest things about entrepreneurship is the potential it holds. That is to say, anyone who wants to be an entrepreneur can certainly follow that path. It’s more common than ever now, too: Perhaps 10 or 20 years ago, telling someone I’m an entrepreneur would have been seen as very “other,” it is growing more and more acceptable to people of all generations. 

Overwhelmingly, I think people are breaking free of the pattern of working in the same industry for a few decades or more. Instead of doing the traditional, mindless thing that perhaps generations before did, we’re able to cast out on our own and pursue what brings us joy and what excites us. We’re leaning into the challenge of building something with our bare hands. 

But potential also begets caution. As appealing as starting a company may be to many people, there’s also a romanticization of entrepreneurship which can very quickly create a trap. 

Many people aren’t aware of the fact that most startups fail. They aren’t prepared for how very challenging it is to build something over the course of many years. 

In my experience speaking with other entrepreneurs, they often think that the arc of their company might be relatively quick, and that they'll achieve a certain benchmark of success in as little as a year and a half. Often it takes a considerably longer amount of time than that, and it takes a tremendous amount of work. Just because you've come up with something interesting, or your product is valuable to one group of people somewhere doesn't mean that those people will be able to find you without proper marketing and footwork on your part. 

It’s also not true that money will solve your problems. Many people think having more money or more employees means more success, but neither of these are necessarily the case. Sometimes keeping a leaner team, keeping focused on your primary objectives, and not being able to do everything actually means your company has a greater chance of succeeding. 

But by far the biggest reason I think most startups fail is that the founders aren’t in the business for the right reason.

Maybe their hearts weren’t truly in the process from the onset, or they lose faith in their idea or lose their nerve somewhere along the way. They might lose the ability to keep showing up day after day after day, often with very little payout. No matter how long you are putting in the work, there really are very few days where you make seismic leaps as a company. And in order for your startup to keep going, you have to want to keep going, no matter how grim your day-to-day workload is. 

Whatever success I've accomplished along my journey has simply come from showing up and putting in the work. Maybe for the first three or four years, I was motivating myself with a dark motivational force, which is to say fear, insecurity, and embarrassment. I cared a lot about what other people thought about me, and I didn't want them to view me as a failure. This was unsustainable, and if I had kept continuing to use those negative thoughts as my primary driving force, I would have flamed out like so many other founders of so many other startups.

What keeps me going now is the fact that my company, which was initially an idea in my brain, is now unequivocally and quite objectively coming to life in the world. I'm able to see the humble beginnings of my vision instead of constantly doubting if the idea would work. That motivates me and excites me, and inspires me to keep going and see exactly what this idea could be at its tallest point.

Remembering why you started your company helps, but it will only get you so far. The Hub is obviously very centered on photography and I do love photography, but I actually do so little photography. Instead, my day-to-day is about marketing and legal and accounting — I’m touching base with my employees and fielding customers and completing any number of other tasks all day, every day. 

As the company grows, you will get further at times from the original love, but it’s also possible that love will shift. At The Hub, there is beauty in the fact that we have empowered all these kids who can suddenly be photographers more easily than they could have otherwise.

It’s worth remembering that entrepreneurship isn't necessarily about the reason that you started your company, and is instead about the many puzzles and challenges along the way. And you will be surprised at what you learn about business, and about yourself. It turns out that I love putting together a really good presentation that expresses an idea very well, and that I love the process of building software and working with developers — which is something that I knew nothing about prior to starting my company. The more you can stay open and receptive to these possible new skills, the more you will be motivated to keep going, and to grow.

There are certainly moments where these skills will be challenging, and when you will want to give up. It’s at those moments that it’s worth remembering that the difference between a pivot and failure is all about how you respond to the same roadblock. A pivot is hitting a brick wall at a hundred miles an hour, getting back in the car and going a totally opposite direction. Failure is hitting a brick wall at a hundred miles an hour and stopping because your car is totaled. They both involve crashing into a wall. 

A startup fails when the founder stops. My company is a lot smaller than it has been at its biggest, but I kept going. People that I would have thought were central to the company have left. Contracts have fallen through. Any number of things have happened that could have caused us to fail or stop. But as long as the founder or the founding team is still bought into the idea and still pushing forward, there is a chance for the idea to still bloom. 

As an entrepreneur, you need to foster persistence. You need to learn to fight another day, because success rarely happens overnight, and you’re going to want to still be around as a company when it’s your turn to collect on the work you put in.

So when you hit a brick wall, get back in the car. You will hit a lot of dead ends during your journey, but there is always a way through the maze. Run scenarios in your head: Ask yourself, If I do this and then do that, and then this happens and then we get this lucky break, and then we do that, can we get out of this situation and can we still reach success?

Sometimes you'll go through three or four paths that actually won’t work, but I've never started a thought exercise without finding at least one way out. There's always a way out. There is always a path that you can believe in, even if it takes a couple of lucky breaks to help you see things through to the end of the day, or to the other side. Because the top reason that startups succeed is simple: The founders fundamentally believed they could work their way out of every problem that came their way, so they did.