The 'Startup Genome' Study Looks at Why New Ventures Fail

 - Jun 27, 2012
According to this infographic by the 'Startup Genome,' only one in 12 entrepreneurs are able to launch a successful business. In order to properly conduct and sustain a company, there are five essential dimensions, which include, funding, business model, customers, product and team. As the chart above depicts, those who commit premature scaling, are most likely to fail.

Companies that do scale prematurely are classified as inconsistent, whereas companies who scale properly are classified as consistent. For example, those who scale prematurely are more likely to have a 50 percent larger workforce then needed, and a 50 percent reduced team after scaling. Inconsistent startups are also more likely to have three times more money in their efficient stage, and 18 times less money after scaling. It is wise for evolving entrepreneurs to plan efficiently before diving in to avoid failure.