In a blog that we found online, it is mentioned that 35% of startups fail. We wanted to test this out so we made a survey ourselves.
This survey was sent out to 300 people of whom 165 answered. Out of those 165 people, 50% had said their startup had failed.
Know your market – is there a great need for your product or service? This is vital information – 20% of people wish that when they had done a hardware startup, they had fully understood the potential in their product by doing more extensive market research.
66% of people found sourcing prototypes to be confusing/difficult. This is an astounding statistic given a hardware prototype is essential for a hardware startup and without this a hardware startup would not thrive or even survive.
A further 20% of startups failed due to prototyping. This is why an extensive amount of research is needed to find suitable manufacturers for your hardware prototype.
Know your Sector
In this survey we found the sector that was targeted most in the tech industry was the IOT sector, which secured 1/3rd of the votes on the startups sector of operation. The Enterprise and the Consumer sector joined second for 20%, robotics 3rd with 13.3% with health and Wearable joined last with 6.7%.
This is not surprising IOT (internet of things) has been a hot topic over the past few years and has an ever-growing amount of applications, from the Smart watch to the smart water bottle.
Knowing your sector early on is crucial to the startup process, it allows for extensive research in to your market.
A startup accelerator is a fixed-term, cohort-based program that includes mentorship and educational components and culminates in a public pitch event or demo day.
Not all startups need to use an accelerator to thrive in business but it certainly does help. 53% of startups surveyed had taken part in an accelerator.
Find out more about accelerators here
40% of startups failed due to team issues – know who you are getting into business with and ensure that they are as committed as you are to this business.
Almost 40% of startups had 0% females on the team. Whereas only 7% of teams were made up of a female majority.
A lot needs to be considered when deciding on starting a business in the hardware sector – your sub-sector, whether or not you will take part in an accelerator, your team, your market and prototyping your product. Don’t let this discourage you.
When asked if they would have done anything differently, people responded as so:
“Tighten up lead times!”
“Cut out dead weight early on.”
“Find a company with smarter co-founders that had done it before.”
“I would have been more careful about my prototype manufacturer.”
78% of people admitted they would do it all over again. So as the saying goes, if at first you don’t succeed…etc.