Everyone has a dream of establishing their start-up and achieving success in a few years. Take Bill Gates, Steve Jobs, or Mark Zuckerberg, for example. Their success stories are an inspiration for everyone. However, things aren't always smooth sailing from the start. According to research, almost 21.5% of the start-ups fail in the first year.
University start-ups are no exception. But, unfortunately, the growing demand for innovation in education does not guarantee success, especially when competing with hundreds of other start-ups in the market.
Thus, if you figure out the common reasons behind the failure of university start-ups beforehand, you can avoid making the same mistake.
Why Do University Start-ups Fail?
Many researchers and professionals have worked together to figure out why some university start-ups fail to achieve success. According to the survey results, there seemed to be six recurring reasons behind this phenomenon. These are:
1. Inadequate funds
Most start-ups don't have a massive amount of capital to begin with. With the help of investors, you can manage to tide through the initial months. However, the problem arises if you fail to secure more funds in the upcoming months. In such cases, the investors might doubt the success of your start-up and pull out from further investments.
2. Location challenges
A common mistake that many entrepreneurs make is to have unrealistic expectations of growth without any plan. A university start-up needs to have a local demand before it can grow into a more successful venture. Therefore, unless you can secure a good foundation in your local area, you cannot expect to gain the funds to move to a larger scale.
3. No unity among the team
Infighting among the team members is often the most common cause of failure. Many people are involved in a start-up, such as the management, investors, university, government and others. Unless everyone shares one common goal, it is impossible to work together as a team.
4. Flawed business plans
A business plan is one of the essential factors that determine the success of a university start-up. Unfortunately, entrepreneurs who are too excited about grand plans and possibilities to come up with a proper business plan will have to face a rude awakening.
A business plan helps you understand the start-up's current situation, what challenges you might face in the upcoming days, the competition in the market, and various crucial information that can make or break your venture. If you wish to see the start-up succeed in the future, a business plan can help you a long way.
5. No online presence
If you want people to hear about your university start-up, then having a website is a must. With the widespread use of the internet worldwide, an online presence is crucial, especially if you want to give off a legitimate feel. If people search the name of your start-up and nothing comes up in the search results, they're bound to be suspicious.
6. Management failure
Failure on the management level has caused many educational start-ups to fail over the years. Incompetent management with no experience with start-ups will be unable to recognise issues like the need for capital, equipment upgradation, hiring new employees, etc.
An educational start-up needs to have strong management that is familiar with the market and the struggles of start-ups to recognise concerning issues immediately. Once you have such a team behind your back, you can ensure better chances of survival in the competitive market.
Prior research is the key to the survival of any start-up. Having a good idea about the common problems you can face allows you to develop possible solutions beforehand.