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May 24, 2012

Why Technology Start Ups Fail: 5 Lesson

Hundreds of tech’s most prominent backers packed into an auditorium at the Computer History Museum in Mountain View, Calif., Friday to hear two-minute pitches from the latest batch of young startups to emerge from business incubator Y Combinator.

More than 400 investors, ranging from big-name venture capitalists such as Battery Ventures and Matrix Partners to smaller angel investors including Ron Conway and Max Levchin, outnumbered the 66 companies giving presentation

Well know “ Start Up” Venture Funding group YCombinator provides seed funding to startups, and works  with business start ups  founders to develop  their ideas and help them deal with investors.  It holds an annual Demo Day where startup founders present their ideas.

Here are some Lessons on how to " 
1.Pick the wrong marketnot make the Mistakes" which other did 
Shoot for the stars. Pick a large market with room for many large winners. Choosing a good market can make up for a lot of operational mistakes. Choosing the wrong market can turn the game of business into a game of roulette in which each chamber has a bullet.
2. Choose the wrong co-founder
The fastest way to ruin a friendship is to start a business with him. Just because you are friends doesn't mean you can work well together. The booby prize for winning a fight with a co-founder? A failed business.
3. Wait too long to launch
Business school classes (so I've heard from friends who spent a small fortune to lose 2 years of their professional lives) talk about finding a "product-market fit." In the real world, we call that building a product or creating a service people will pay for.
The only way to really know if your offering has a future is to actually go to real people and ask them to buy, or use it—soon.
 4.Marginal Niche

Most of the groups that apply to Y Combinator suffer from a common problem: choosing a small, obscure niche in the hope of avoiding competition
5.Choosing the Wrong Platform: The scary thing about platforms is unless you have someone who understands technology.. the economics will probably drive your thoughts, on getting technology outsources.While Tech outsourcing is  a major " cost saver" in the long run.... Unless you have some " who knows and understand your business and lives  and breathes  your vision .