Why online businesses fail

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  • 1 They failed to make money

    Many online business fail after failing to make money or finding a way to generate revenue out of their online business.

  • 2 They ran out of money

    Many online businesses fail after they run out of money. If the investors or the owners are not willing to put more money in the business and the business ran out of money then they might shut down the business.

  • 3 Tough competition

    A business could fail to keep up with the competition and so fail. A famous example is how Facebook took over Myspace and Friendster.

  • 4 The business never gained traction

    Some online businesses are shut down when they fail to get enough traction. If the business failed to attract a certain number of customers in a certain amount of time then it might be shut down.

  • 5 Failing to adapt to changes

    Many internet businesses might die as a result of failing to adapt to the technological changes that happen. If, for example, a business failed to adapt to a new trend then it might die. 

  • 6 Wrong market research

    Sometimes an online business can fail after the owners realize that their product or service wasn't really needed. Poor market research can lead to products that people don't really want.

  • 7 Failure to get investors

    Many internet businesses fail as a result of failing to get the right investors. Many e-businesses require a lot of money to survive and if no investor provided this money then the business might fail.

  • 8 Giving up too early

    Some business owners have the get rich quick mentality. They assume that an internet business is a type of business that should make them rich fast. This is why they might give up early.

  • 9 No strong differentiation

    An online business can fail if the products or the services it offers aren't very different than the ones in the market. Without proper differentiation, a business can hardly survive in a crowded market.

  • 10 Hiring the wrong people

    One of the key elements of a business' success is having the right team on board. If the business has no problems but the team it could still fail. See top reasons businesses fail.

  • 11 Poor marketing

    Even a business with a good product can fail if the marketing is poor. Some businesses fail because they don't manage to reach the right customers.

  • 12 Failing to keep customers

    Some businesses succeed initially but fail to keep their customers or their users and so end up failing.