Statistics on business failure rate vary drastically, with some figures claiming as many as 90% of start-ups do not survive, while others say in reality, approximately half of new business ventures fail. There are a huge variety of reasons behind businesses failure, including lack of funding and a lack of research into the viability of the venture.
While there are a typical range of challenges that the majority of startups face, such as building their brand and attracting customers, tech businesses face their own specific set of issues.
Lots of Competition
It is hard to deny that we now live in a world that is dominated by technology, from our leisurely pursuits to our daily working lives. As such, there has been a recent boom in the number of tech start-ups. This means that the market has quickly become saturated, resulting in tech companies facing a lot of tough competition, so businesses must be innovative in order to get ahead.
As a tech company, you may be doing anything from creating industry-leading software to building prototypes. No matter what area your tech business is focussed around, or what product or service you offer, it is likely that most of the work performed is probably done online. As such, it is essential that tech business owners invest in the best cyber security, as an attack could lead to destruction of the enterprise.
If a tech business provides its services in a B2B capacity, it could end up going down a route that can spell disaster: a small client base. While it is fantastic to secure a large client, if all of the company’s work is focussed around that one business, what happens if the client decides to take its business elsewhere? Always try to keep a healthy supply of clients on your books to avoid disaster.
Your business may focus on games programming, but if a client is also looking for someone to build their website and manage their social media, it can be very easy to become enamoured by the potential of extra work. Try not to forget business focus and try not to be swayed into working in areas with which you are not specialist or familiar.
In addition to these tech specific challenges, many tech businesses face one common entrepreneurial issue: finances. How can you boost cash flow so you can reinvest and grow your tech business? What are the best type of investments to make? And how can you best manage your assets? This is where financial services are crucial.
Financial services can help tech businesses in a number of ways, including:
- Providing a designated financial advisor to advise and help your business
- Assist with wealth planning and management
- Provide a specialist broker service for investment purposes
- Assess risk and create plans for a stable future
With tough competition, any tech company must safeguard their financial practices to increase their chances of success. A financial advisor can help you to plan for the future and reduce the pressure, allowing you to focus on core business activities so you can grow your tech business.