Why do startups fail after MILLIONS of dollars?

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"How does your company fail after raising $50MM?" This was a real question on one of our Company Forensics videos. For someone outside the startup ecosystem, the amounts of money these companies raise just seem obscene. Some companies (Uber, WeWork) raise BILLIONS. Even smaller companies deal with rounds in the millions of dollars, and valuations in the hundreds of millions. So why do investors pour so much money into these tech startups? Today, I'm going to tell you why.

#slidebean #startups #fundraising

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Caya’s Social Media:

[ongeri]

I often get the feeling startups tend to spend more than they have to. Sometimes the venture capital model encourages founders to just hunt for more funding and investors rather than seeking profitability.

[sanujitroy]

60% startup fail due to poor planning, poor quality candidates and over estimation

[joshm-d]

It annoys me how "A day in the life of a billionaire" get hundreds of thousands times as many views as explaining businesses.

[ceciliabaeza-castro]

Hey Caya! I’d love to hear examples about mission-driven startups.. perhaps Edtech or one that implement outside the US. Thanks

[Naruedyoh]

As an european, to see "medical care" and "paid vacation days" as "Work benefits" is very disturbing

[Humblyguided]

Another wonderful video Caya, I would say 1st attempt not always successful, if you haven’t failed, you won’t be where you are today! Life is only lesson, how we apply those lesson is up to us, looking to more video! Keep going !

[PomegranateChocolate]

One thing I learn from your site is people from Costa Rica don't have an accent in their English.

[silasadedoyin]

02:17 and then they make it to our startup forensics series 😂

[MWHM]

Because they all try to reinvent the wheel while having no clue on how to run a business. Most of the time they have never had a serious job in a large corporation where they needed to implement or write processes.

[MassiveSuccessVids]

Listening to the videos tells me, "Hello, wake up"! VCs will never invest in my multimedia content production-distribution mini-studio. Gotta find another way, hopefully self-sufficient.

[maps]

i still don't understand why big platforms are sold, like why Instagram, Skype or other i don't know now was sold for billions, why they couldn't continue to be an individual like they were, maybe the ones who started them had enough and wanted a life time vacation and some money to invest in something else and not bother about profit or else

[ndle_king]

25% overhead on offered salary is way too low.

[affansiddhiqui]

Damn ! I'm addicted to your videos

[InkaHacker]

hahaha there is even entire books about this. "Why most businesses fail in the first five minutes and takes them 3-5 years to realize it. Position to win"

[AmaritoMan]

You amaze me Caya thanks for explaining what was a mystery quite for some times in simple English thanks man

[Noname-rmxu]

"...and then how to fail a company" =))

[grapplerke]

lol 150, 000 a year. Must not be adding in bonus and stock options. SF and NYC engineers are making 300-500K in total compensation these days.

[aprilmintacpineda]

Hmmm, don't get me wrong Caya, but there seems to be an inconsistency, you just said: "WeWork raised 22 billion dollars [...]" and then "Why do investors pour so much money into these tech startups". So did you just say that WeWork is a tech startup? Because I thought it wasn't, based on your video startup forensics about we work when you said: "Wework was not a tech company, it was a real estate company with some tech.", so has there been any changes or was my inference incorrect?

[GameFuMaster]

The problem with concentration of wealth with so few people, is that there isn't as much innovation as there could be.

[mrpgroe]

What would be the best middle way between startups the raising lots of investments and the lean startup methodology, but still being able to compete with startups that have big investments?
Why is there so much difference in the startup strategy between Europe and the USA (bay area)?