Is It Time You Gave Up On Your Startup?
- Written by News Company
If there is one thing every first-time entrepreneur has in common it’s emotion. They know they’re dealing with a business, but because it’s their first attempt it can be hard to push emotion aside and think with a strictly business brain. This makes it even harder to take a deep breath, bite the bullet and put your failing startup out of its misery. But you might have to.
Over 90% of all startups fail. The odds were never in your favor. It doesn’t matter if you survived the tough first year or you made it to the hugely impressive five-year mark, most startups fail. So instead of clinging on and wasting your time, it might make sense to look up the definition of company liquidationt, apply for bankruptcy and put your talent and effort into something new, using what you learned to improve your chances the next time around.
Think of it like poker. The best players aren’t the ones that can bluff well, they’re the ones who know when they have a great hand and know when they don’t. They’re the ones who know when to fold, giving themselves a better chance to win on their next hand. Like we said above, it’s not easy. Blood, sweat, tears, sleepless nights, anxiety attacks, money - it all gets thrown at a startup. But it might make financial sense to give up on this one, not to mention strategic sense too.
The trouble is knowing when you have a lost cause on your hand because the signs aren’t always easy to read. So, without further ado, here are things to look out for when determining whether to stick or fold.
- The Value Of Your Business Has Gone
Nothing lasts forever. Nothing. So if you’ve noticed your business doesn’t hold the same value in the eyes of your customers or target audience, you need to accept your startup won’t be able to bring in the profit margin you had once hoped for. The only businesses that survive are the ones that offer people something of value, something that will improve their lives or something that will help them solve a problem. If yours no longer does this, you need to call it quits and find something that does. These are the three things that influence a buyer’s decision to part with their cash.
- Risks Have Gotten Much Too High
When you enter into the world of entrepreneurship, you’re signing a deal with yourself to shoulder a whole bunch of risks. It’s what makes this such a thrilling way to work. You’ve left the security of employment behind, put your savings into your idea, put your work-life balance to the back of your mind and forgone the chance to go on bi-annual vacations - and most of the time it’s worth it because the rewards could be huge. If, however, the risks now trump the potential rewards, it’s time to hang up the boots. It’s that feeling in your gut that this is no longer fun, it’s scary. It’s seeing money flood out and no way to turn it around. Don’t dig a hole any deeper than it has to be. Debt and lawsuits are things you want to avoid at all costs.
- No Light At The End Of The Tunnel
When you start a business, you know deep down this is a long-term project. It’s why you set a long-term goal with lots of short-term milestones to guide you. You might have said you want to reach this mark by year X or you might have made a plan to sell-up when you managed to achieve this or that. But sometimes that isn’t possible and all you are faced with is dead-ends and closed roads. When that starts to happen and you exhausted all attempts to turn a profit, it could be time to close up shop. In fact, we urge you to close up shop. Money spent fighting for a lost cause is time you could be putting into something new.
- You Just Weren’t Quick Enough