Startup tips

Bring your startup to the next level: top 3 startup challenges analyzed


Founding a startup is not for the faint of heart. Even though the barriers to launching a startup are at their lowest as they were before, 90% of new startups in 2020 have failed. What is most inspiring in this saga about entrepreneurship, is that a community of bright individuals challenges global corporations and proves that anyone with talent and a smart idea can build a successful business. That is truly inspiring and probably is the main reason why I’ve joined an early-stage startup.

Only the strong survive. Turns out, this phrase relates not only to people but also to startups. As a recent startup employee, I’ve observed that a path of a young business idea is somewhat chaotic and definitely not easy.

So how can you bring your startup to the next level? I’ve analyzed the 3 most startup challenges and tried to find a practical solution among millions of advice from seasoned entrepreneurs. Knowing what startup challenges your product faces and how to overcome them, will increase your chances of success.

startup challenges

Problem #1. Lack of idea validation

A successful startup begins with a deep understanding of a problem that shapes product development. And this issue should be relevant to a certain group of people (preferably a big one). Unfortunately, 34% of startups fail because they cannot find a market fit. “Before starting to invest your time and resources into developing an idea into a company, validate your idea and get enough feedback,” says Ammar Akhtar, founder of Finalrentals. That brings us to a question: so how can a founder validate his idea and decide whether it’s worth moving on with it?


Do your research! If after reading various sources you think a particular startup idea will be used by many clients or businesses, here’s how to find the industry specialists and ask them:

  • Specialized Facebook groups

  • Linkedin

  • Specialized platforms – like Indiehackers and Projectium

  • Reddit

  • Discord

Find out the pros and cons of these platforms in our previous article .

startup challenges

Problem #2. Not keeping your focus narrow enough

If you want to be successful, find your highly specialized niche and create a solution that will solve one of its problems. According to the Fortune article, the primary reason why all startups fail is the lack of market need (42%). Profitable niches should be looked for where there is demand but a lack of quality offers.

Many entrepreneurs are struggling to reinvent the bicycle and simply fail to notice that the market is in need of bicycle parts or maintenance services. Usually, the same technology can be used in different scenarios and served ‘under a different sauce’.

“It’s crucial to start focusing and narrowing down from the start. As the project grows, one can spiral down and expand to other niches”, says Hugo Magalhães, the founder of Helppier.


1. Evaluate your passions and skills

Understand what you are passionate about and what are you good at. Or something you hate and want to improve! Hugo Magalhães has been creating user manuals for Siemens and decided to improve that experience. That’s how he created the first demo version of his product. Therefore, asses what you love and what you can do — that’s the first step to finding your niche.

2. Figure out if there’s a market for your niche

Plug in some keywords related to your niche, and see which words and phrases get suggested. Narrow down the suggestions by monthly search volume, competition level, and suggested bid” – Rampton suggests. Consequently, find out if there are potential customers for your potential startup field. No customers — no market!

3. Narrow down your niche

That’s where idea validation comes into play! Register at sources, such as Projectium and Indiehackers, browse Reddit, Facebook or Linkedin groups, and ask other professionals!

4. Check out the competition for yourself

A good sign that this niche is worth pursuing, is when the sites ranking for your keywords are generally smaller or of a low quality.

5. Test your niche

One way to test your niche is to create a landing page that promotes a free info product related to your niche”, advises Rampton. So, test your niche and find out if it is in demand.

Problem # 3. Lack of funding

The financials is always in the first place for any business, and for startups in particular, since the amount of money for starting a project, as a rule, is limited. Having talked with several startup founders, I’ve discovered that almost all young businesses tend to face the problem of lack of finance at one stage or another.

The lack of finance during the early stage can be often is fatal for many startups, preventing them from growth: be it launching new product features or hiring competent specialists.


Statistics says, that the price of launching a venture nowadays is 1000% lower than it used to be twenty years ago. The majority of young tech projects are bootstrapping, so can you.

Many experts and seasoned entrepreneurs recommend that startup founders think about financial management from the very beginning, trying to keep costs as low as possible. Ammar Akhtar recommends to carefully calculate the funds and have enough for at least a year of running a business and having enough to make a living if your business never takes off.

The savings should not be harmful – cutting development costs or salaries of professionals will more often harm a startup than vice versa. But it’s not a sin to save money on the office, for instance. Research illustrates that remote teams are more innovative and are more likely to stay with the employer.

Yerdle’s co-founder and business coach Karl Tashian believes that most startups are not ruined by funding problems, staffing errors, or poor product vision. In order to prevent the death of the company, he suggests, first of all, to understand yourself and be passionate about what you do.

No doubt, a startup is a risky business. Startup challenges might be hard to solve. Though, once everyone said that people cannot fly. The Wright brothers believed in their dream and took the risk of flying on the first plane. Apple, Virgin Atlantic, and Microsoft were also risky ideas at the time. But that’s the point! The entrepreneurial spirit is based on risk. And the one who overcomes the fear – thrives.

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