CFP Update: June 2016
CB Insights recently analyzed the post-mortem reports of 101 startups to determine the top 20 causes of startup death. The leading cause by an overwhelming margin was no market need for the product. We call this the "solution looking for a problem" or the "Field of Dreams" approach to building products and companies - build it and they will come. This only works if your name is Ray Kinsella. The best way to prevent the "no market need" cause of death is to use a systematic approach to customer development, the cornerstone of the Cedar Fork Partners method of helping companies find product market fit.
- Search - Find customers who have the problem you want to solve
- Satisfy - Get early adopter customers to pay you with time or dollars
- Sell - Get more customers beyond the early adopters to buy
- Scale - Build a team to support and accelerate customer growth
Here are the top 5 reasons for startup death based on CB Insights data: