Cracking the code: Why some great startups fail and good stories win

I've helped both launch, grow and even sell businesses over the past years, from introducing new divisions, launching product lines to getting startups off the ground.

And yes! The startup world is full of ambition, caffeine, late nights and big dreams. I know, I have been there several times to support launches, help drive growth and build market share.

Yet despite this energy, the reality is sobering: 90% of startups fail and nearly two-thirds don’t survive past 10 years (Investopedia, The Guardian).

But here's the good news: startup failure isn’t random. It follows patterns, clear, documented ones. And within these patterns lies opportunity. The more we understand why startups fail, the better we can build the foundation for lasting success.

Core reasons behind startup failure

Several major studies have investigated startup failure, including CB Insights' renowned post-mortem analysis. These are the most cited reasons:

• No market need – 42%

  Startups create products no one actually wants. Passion doesn’t equal demand.

• Ran out of cash – 29%

  Poor financial planning or premature scaling eats up capital before real traction occurs.

• Team issues – ~23%

  A lack of alignment, skill gaps or co-founder conflict derails progress.

• Strong competition – ~19%

  Failing to differentiate or respond to rivals quickly leads to irrelevance.

• Pricing and cost issues – 18%

  Products are either too expensive for the value offered or underpriced and unsustainable.

• Poor product – 17%

  A lack of polish, usability or functionality turns early users away.

• Poor marketing – 14%

  Even great products fail if no one hears about them or doesn’t understand why they matter.

• Ignoring customers – 14%

  Founders build in a bubble, disconnected from actual user needs.

Sources: CB Insights, Reddit, StartupDevKit, Silicon Digest, Wired

These categories aren’t isolated, they overlap. And if you look closely, many of them lead back to one central problem: a failure to communicate value effectively.

And there is a consistent message in each of these numbers, it’s often all about MARKETING. 

Marketing isn’t just about pretty pictures or clever slogans, it’s the engine behind your business strategy. It shapes how you define your product, how you price it, how you differentiate from competitors and how well you understand and respond to your market. 

It's the voice of your customer inside your company. Great marketing inspires your team, sharpens your focus and drives the decisions that matter. It’s not a cost center, it’s one of the smartest investments you can make. Yet many startups ignore it completely, hell bent on the idea that “they will manage it themselves,” and "will just pop a few posts on social and that should do it."

The marketing-centric problem few startups want to admit

Ask most founders why their startup didn’t scale and you’ll often hear: “The product just didn’t stick” or “We couldn’t raise another round.” But often, the underlying issue was:

• People didn’t understand the product.

• The story didn’t inspire.

• The pricing didn’t match perceived value.

• There was no consistent brand or positioning.

  
  

In short: they didn’t connect.

A Reddit entrepreneur put it bluntly:

“90% of SaaS companies fail… because they don’t effectively communicate their value to users.”

Even “no market need” the #1 reason for failure is usually a sign that a startup didn’t test or market its idea properly early on. Ideas aren't validated through code, they're validated through conversation.

Story, brand, vision: The “unsexy” keys to survival

Startups often pour their energy into code, features, product-market fit, but overlook their story. That’s a costly mistake.

The startups that break through aren’t always the ones with the best tech. They're the ones that can explain why their product matters clearly, quickly and emotionally. They're the ones that resonate. That’s what storytelling, branding, and mission alignment do.

The best startups:

1. Solve a specific, real-world problem.

2. Explain that problem simply and powerfully.

3. Connect it to a larger purpose or emotional driver.

   
   

You don’t need a million-dollar campaign. You need a coherent message, repeated consistently, in a voice that builds trust.

How to build for success: A marketing-driven blueprint

If a lack of marketing is often the silent killer and therefore your greatest underused weapon. Here’s how to leverage it to build smarter:

1. Start with market discovery

Don’t build blindly. Interview users. Run surveys. Talk to 50 people before writing a single line of code.

Ask: What keeps them up at night? How do they solve this problem today? Would they pay for a solution like yours?

2. Validate demand early

Don’t assume your idea is great, test it.

Run a landing page test. Try a crowdfunding campaign. Create a no-code MVP. See if people are willing to click, sign up or pay.

3. Craft a clear story

What’s your elevator pitch? Can a non-expert repeat it? Does it spark curiosity?

Great storytelling = Problem → Solution → Why now? → Why us?

4. Align pricing with value

Pricing is marketing. Too cheap feels low-quality; too expensive feels risky. Test pricing just as much as features. Frame pricing in terms of return: time saved, revenue gained, pain avoided.

5. Invest in a consistent brand identity

Your name, logo, tone and visuals should reinforce your value proposition. Consistency builds trust. A clear, professional brand helps people feel safe saying “yes.”

6. Measure, iterate, refine

Track what's working: click-throughs, engagement, signups, conversions. Adapt fast and kill what doesn’t move the needle. “What gets measured gets managed.”

The real takeaway

Startups don’t fail because they’re bad ideas. They fail because people don’t get them.

That’s not a product problem, it’s a communication problem. You might have the next big thing. But if your story is fuzzy, your value unclear and your brand forgettable, you’re asking your audience to do the work. And most won’t.

Flip the script

Make your message sing. Make your product feel like a solution. Build not just with code, but with clarity, conviction and connection.

Startups that win don’t just make great products.

They tell great stories.

Are you ready? Then why not DM me below.

About the author

Frederique Depraetere is a native English and Dutch speaker with a UK/US education and background. He is a seasoned global marketing leader with over 20 years of experience driving growth across technology, SaaS and innovation sectors. As a fractional CMO/CCO, he supports startups, scale-ups and biotech companies as well as established companies, advocacy groups and NGOs in shaping strategy, building brands and accelerating results. His international expertise spans fast-moving markets and high-stakes communications, helping ambitious teams turn ideas into impact.