Why do 9 out of 10 start-ups fail? A question of interest to Christine Christian; Chairman of Kirwood Capital, Director of FlexiGroup Limited, Victorian Managed Insurance Authority, ME Bank and Lonsec Fiscal Group, Deputy President and Board Member at State Library of Victoria and Co-Founder of New-York based Powerlinx Inc.
What drives success in start-ups?
In her presentation, Christine draws on her vast corporate and philanthropic background to explore what have been the success factors for new start-ups from her experience. Christine discusses key elements such as the skills you must develop to succeed, the importance of timing, the strength of an idea, funding for success and the execution for start-ups. Christine presents from her perspective as a co-investor in start-ups over the last 5 years where she has made 11 start-up investments.
Why do so many start-ups fail?
Together with some co-investors, Christine commissioned research using Dunn and Bradstreet data to conduct regression analysis of what drives success in start-ups. What is the biggest predictor of likely success among the common elements? E.g. strength of idea, timing, leadership, strength of the team, amount of working capital, execution, marketing etc.
Timing, timing, timing
Her answer may surprise you. Christine presents statistical evidence that timing is the biggest predictor of start-up success, although all the elements remain important. That is, to attract investors, start-ups need to bring something different to a market at a moment in time that is attractive and accessible to consumers and can be enabled by smart technology.
Watch Christine’s presentation below:
This blog is part of the LBS Innovation Series, developed by Dr Mark Cloney, Professor of Practice in Economics in the La Trobe Business School. The series was developed after the successful National Innovation Forum organised by La Trobe Business School, NORTH Link and Deloitte Consulting P/L.
More blogs in the LBS Innovation Series:
- LBS Innovation Series: Introduction
- LBS Innovation Series: Universities’ engagement with industry
- LBS Innovation Series: A start-up science story
- LBS Innovation Series: Think big or go home
- LBS Innovation Series: Welcome to the 4th Industrial Revolution
- LBS Innovation Series: How can universities strengthen firms’ innovative ability?
- LBS Innovation Series: Melbourne Innovation Centre – A case study in innovation