Making your startup succeed while so many fail is not for the faint of heart! But success comes easier when you know the dangers. A recent study published by CB Insights covered some of the most common dangers ( Here I discuss their top dangers and add steps to help you move safely through your own early journey.

Reason #1: No market need — 42%

Yikes! How did this happen…

VC Andy Rachleff says he asks every founder:“What do you uniquely offer, that people desperately want?” It’s hard to predict what people want desperately, it’s even harder to predict when they will finally want it.

The key to lowering this risk, is a tight focus on the user (or customer). You should be carefully identifying who is your target audience and who is not. You must examine their unmet needs, their moment of need and their alternatives to your solution. If you are bootstrapping your startup, you may not have the resources for a pivot. So getting it right early can make the difference in realizing your dream.

Reason #2: Ran out of cash — 29%

Missed it by that much


You might find more cash, eventually. But by the time you do, the market has moved on, your target has changed. Much better to adjust for the wind and make your first shot count.

It’s important that you sit down and define your product carefully. You believe powerfully in your idea and you have thoughts about how to accomplish it. But you need to communicate these ideas to investors, partners, employees and more. And you will benefit from hearing other people’s ideas. Get someone to challenge your assumptions, someone to push your boundaries, someone to make you spell it out. The earlier you converge on the right set of product features, the more budget you will have left to improve your product, to service your early customers and to respond to their feedback.

Reason #3: Not the right team — 23%

Finding the goal?

The earlier you choose your team, the less choice you have. People who join nascent startups, especially pre-funding startups, can fall into these categories:

  1. People who are already so committed to solving the problem you are addressing, that they would have created their own startup if you hadn’t found them. If you meet a person who adds energy, honesty and humility to that commitment, pull out all the stops to bring him or her on board.
  2. People who have very few choices. You can find people who will work for equity or low salaries because their other options are limited. But there is nothing about that circumstance that leads you to the right people to make your venture successful.

Avoid rushing into early personnel choices that are likely to leave scars on you and your startup. Once you have the right situation, one that draws the right people, you can make smart hires.

Reason #4: Get out-competed — 19%


It’s hard to overcome a slow start!

For a company that is pre-product there is no competitive vector more critical than speed to market. You can’t learn everything you need from actual users or customers until you put a product in their hands. If your competitor is there first, their lead will be permanent unless they really screw up. Be better, faster, stronger! Don’t count on a stumble by your rival.

Reason #5: User un-friendly product — 17%

How does that work?

Ignoring your users’ needs is a critical weakness. If your product is hard to use, then the problem you are solving had better be life-changing. Otherwise your users will abandon the product before you can learn enough to improve.

Stepping Wide

In conclusion, to avoid the top five dangers to startups:

  1. Focus sharply on the user.
  2. Get early feedback.
  3. Hire deliberately.
  4. Enter the market swiftly.
  5. Design the user experience thoughtfully.

Blue Rocket

A company like Blue Rocket can help with all of these precautions and more. We build first products with proven teams, proven methods and know-how that stretches across hundreds of startups.

We start by sitting down with you and detailing your target audience, your competitive landscape and the difference your solution will make in the lives of your users. As your product workshop continues we encourage you to think more widely than ever. But as we wrap up, we help you to focus on the essence of your idea and the minimum feature set required to test it in the market.

Also, Blue Rocket has learned much about right-sizing your user experience design to your budget, your audience and the problem you are solving. Let us show you what we’ve learned here!

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Blue Rocket is a digital product development company based in San Francisco. Through strategy, design, and engineering, we help great companies build powerful digital experiences — the right way. Email us at