Why Do Many Startup Businesses Fail? Here's Why

Most startups fail. According to CB Insights, one of the biggest reasons is lack of funding or inability to generate capital gains.

38% of startups fail due to lack of money. Furthermore, the main reason behind the failure of startups is the lack of market need (35%).

Reasons for startup failure include:

1. Lack of funding (38%)
2. No market need (35%)
3. Losing in competition (20%)
4. Flawed business model (19%)
5. Policy or legal issues (18%)
6. Pricing (15%)
7. Wrong team (14%)
8. Poor timing/marketing (10%)
9. Poor product quality (8%)
10. Disharmony between team and investors (7%)
11. Failed pivot (6%)
12. Burnout (5%)

Based on data from the Indonesian Ministry of Communication and Informatics (Kemenkominfo), there are currently 1,300 startups in Indonesia participating in the National Movement of 1000 Startups program. However, only 10 percent have survived to this day.

According to Kemenkominfo, startup failures in Indonesia are caused by managerial factors, such as lack of experience and vision from the founders and lack of focus in running the business.

(read: DANA Becomes Indonesia's Newest Unicorn, This is its Valuation According to CB Insights)