Saturday, November 19, 2011

Why Startups Fail Out Of The Gate

The more startups I see, use, and review makes me question the future of things. It would appear to me that we are on the cusp of some serious changes in the culture. Robert Scoble and Sean Parker have both given their critical thoughts of the startup world based on years of experience. From my perspective the startup problems I see are noticeable right away and tend to fall within two main categories.

First, the definition of a startup seems to have become a bit convoluted. It may not have ever been written in stone, but a startup at least meant a company with a specific vision, a business plan, or one that brought an innovative product or thought to market.

Woother is a weather "startup" according to the entry on The Startup Pitch. It plans to be a simple and easy to use weather service that provides accurate weather information on the desktop and on mobile devices. I would categorize this as a project and not a startup. We have many weather websites and apps today, from simple to complex, that are substantially better than this. There is no market for this service which offers no advantage or innovation over the others.

Second, many products or services are brought to market to quickly. I am finding more and more private alpha and beta releases that are not ready for primetime. Even with an early release startups should have a complete product that has been tested and used substantially before any release. These "private" tests that the public can signup for and get in on are essentially public launches. Not only do they use up valuable launch media coverage, they risk bad reviews because of an inferior incomplete product.

Take SphereUp as an example. Looking over the website pages it appears to be an address book management platform that brings in contacts from Gmail, Skype, Yahoo, Salesforce, LinkedIn, Facebook, and more. Apparently all these contacts are blended together into a database that is available on your desktop, the web, and your mobile device. This program/app also acts as a place to initiate conversations with your contacts through different the channels.

I was accepted into the test and was surprised to find there is only a local desktop program that pulls in your contacts from Gmail, Facebook, and Salesforce. The desktop application is nothing special and needs a lot of work. The astonishing thing to me was that the web portal and mobile apps are still in development and the test versions won't be available until next year. This launch should have waited because nothing advertised is working yet. It would have been better to stay behind closed doors until the product was complete.

The lesson here is to slow down and build quality products to completion that are new, or improve upon the current standard, and that have a definitive use case that fills a need. What are your feelings? Share your thoughts in the comments below.