On the 6th of October, 2023, it was reported that Dash, a startup based in Ghana, had shut down.
That’s a few weeks after it was also reported that Payday, a startup based in Nigeria was in the process of being sold.
This makes it important to ask this simple question “Why do startups fail?”
There are a lot of reasons why startups fail, however here are the key reasons why startups fail:
Bad Corporate Governance: Inadequate corporate governance can lead to a lack of accountability within the organization, making it difficult to question poor decision-making, such as excessive CEO salaries.
Cash Burn: Many startups spend more money than they generate in revenue, often due to factors like excessive hiring, extravagant marketing campaigns, and mismanagement of funds.
Toxic Work Environments: Pressure for success and poor leadership styles can create toxic work environments in startups, leading to employee stress, burnout, and talent drain.
Power Tussles: Conflicts and power struggles among co-founders, often due to unclear roles and unequal contributions, can hinder a startup’s growth and even truncate the startup.
Kindly share some other reasons why startups fail in the comment section.