Must know: Challenges projects and startups are facing
The journey of project growth is a complex and swerving route full of surprises inside and out. While we do not use the word ‘impossible’ at DStarter, there are many challenges that we have faced in the past and that we continue to give onto on a daily basis. Amongst those challenges, most of them are quite common! As a result, this article addresses three of the most challenges that new businesses have and offers solutions.
Limited capital and inappropriate allocation
The startups usually have more limited capital since the average time it takes founders to raise initial funding is between six and twelve months, but they need to invest significant money in many processes. This can put a strain on the startup’s finances and can ultimately lead to financial difficulties.
Working capital is a challenging issue that many firms must deal with; research found that 82 percent of them restrict growth owing to a lack of liquid money. According to CB Insights research, 29% of businesses wouldn’t be in financial trouble if financing were allocated effectively. But somehow there is a reality that there are many projects lacking capital of not having appropriate allocation which leads to the overfunded. Due to overfunded early rounds, startups are wasting money on unnecessary stuff, while on the other hand, large investments are exposing investors to increased risk if something goes south.
Although there are various ways to overcome these challenges, such as asking for a venture capitalist or angel funding, money management still presents a substantial challenge for many businesses. It is imperative that businesses thoroughly consider their alternatives in light of this.
Managing time effectively is crucial when launching a start-up. Since new businesses are occupied with many problems, it can be easy to get distracted and focus on the wrong areas, especially in the tech field. It is easy to see that even though most projects have a roadmap when it comes to raising funds, most of them come up short of the objectives.
Planning is vital as it will keep projects on track and focused on your goals. The projects can easily end up working in your business rather than on business, but there are not many projects complying with the time management plan which leads to various serious problems. It definitely makes miscommunication between investors and the team by ensuring progress stays on the same track as well as can not clarify to investors the steps that were taken during the project’s execution. Thus disadvantages are many and solutions must be raised to adapt to those emergencies.
Lack of expertise and experience
Many projects are lacking the expertise as CB Insights has shown that there are 9.0 million JavaScript developers and 30 million software developers. In contrast, there were just over 200,000 blockchain developers as of late 2020.
In addition to hiring from such a narrow skill pool, emerging businesses must compete with Fortune 500 enterprises that are all looking for blockchain positions, like IBM, Ernst & Young, and Oracle. Thus, the expertise is difficult to hire.
Consequently, it leads to the fact that projects frequently lack blockchain-specific expertise preventing them from knowing what to look for from investors or how to accurately operate their prospects of success. Then most of the startups are fresher and non-experienced in this field might lead to failure and shut down the project.
Therefore, without mentorship, a project will never acquire useful and accurate real-world experience.
Consequently, the projects/startups must research for a better solution and DStarter would be ready to help with all the value we offer. At DStarter, we help to build the connection between Startups and investors to ensure both sides have a “win-win” situation throughout an effective investment environment and minimize risks for VCs/Investors.
