Author: AllegisCap

Exclusive: cybersecurity startup RedOwl raises $17 million series b

  |   Portfolio News

This Baltimore cybersecurity startup routs insider threats.

 

by  Robert Hackett, Fortune.com – Jul 13, 2015 – Sure, Guy Filippelli did a stint with the National Security Agency. As a member of that spy team, he helped re-architect how the agency disseminated intelligence to military officers. But that’s not where Filippelli cut his teeth. “Actually, the army was much more formative for me,” the CEO and founder of cybersecurity startup RedOwl tells Fortune. In late 2001, Filippelli, by then a West Point grad with experience in computer science, had been gearing up for the United States’ post-9/11 invasion of Afghanistan. The military’s intelligence apparatus was technologically lacking at the time, he says, and so the top brass selected a few young army officers to run software engineering teams, to boost officers’ decision-making capabilities. That’s when Filippelli got his start.

“In the army, nobody is gathering intelligence just to gather intelligence,” he says, hinting at an essential difference between the missions of his former employers. “An army intelligence team’s goal is to quickly get data together and to turn that into information that can be actioned in support of a decision on the battlefield.” The job entails gathering relevant details quickly, correctly, and serving them up to the leaders devising strategies. During conflict, lives depend on it.

Today, Filippelli is applying that insight at RedOwl, a cloud-based behavioral analytics software company he founded in 2011 after leaving the public sector. The Baltimore, Md.-based firm specializes in bringing together disparate streams of data within an organization. They could include activity on the IT network, email exchanges, and other sources of data, in order to help companies mitigate insider risk—which could manifest as a rogue, sloppy, or compromised employee, for example.

On Monday, RedOwl will announce that is has raised a $17 million Series B round of funding, bringing total funding to nearly $30 million so far. Participants in the latest round include Allegis Capital, a venture capital firm, which led the raise, as well as Blackstone Group, the private equity firm, and angel investor Marc Benioff, the founder and CEO of sales-tool giant Salesforce. The company already has a relationship with In-Q-Tel, the venture capital arm of the Central Intelligence Agency.

Soon after contractor and whistleblower Edward Snowden leaked a trove of NSA internal documents in 2013, Filippelli says that RedOwl’s appeal leaped from a “nice to have” to a “need to have” among potential customers. The company’s flagship product, “reveal,” monitors users, spots anomalies, predicts malfeasance, and gives the operators a chance to stop data heists before they happen.

> Read Article

Read More

Allegis Capital to Emphasize Cybersecurity With New Fund

  |   Allegis News

by Deborah Gage, WSJ Venture Capital Dispatch – Jul 1, 2015 – Allegis Capital has closed on $100 million toward a new fund that will emphasize investments in cybersecurity startups. The fund’s target is about $150 million, but the firm announced the first close because “we wanted to get going,” said founder and Managing Director Bob Ackerman. “All our deal flow in cyber comes from entrepreneurs, and we want to make sure that every entrepreneur doing something out there knows what we’re doing.”Although the firm has invested in cybersecurity companies since 2000–notable investments include the email security company IronPort Systems, which sold to Cisco Systems Inc. in 2007 for $830 million–historically, cybersecurity has been viewed as a niche, he said. Now “everybody acknowledges there is a problem and we don’t have a lot of explaining to do,” Mr. Ackerman said. Cybersecurity “stands in front of the information technology infrastructure that underlies the entire global economy.”

In 2014—a year in which at least four Fortune 500 companies revealed cybersecurity breaches—U. S. venture capitalists invested $1.77 billion, a record amount, into privately held cybersecurity companies, topping the previous record of $1.62 billion set in 2000 during the dot-com boom. Globally, venture-backed cybersecurity companies raised $1.9 billion last year, also a record, according to Dow Jones VentureSource. The new fund, Allegis VI LP, will invest in two types of cybersecurity startups: those securing legacy infrastructure that was designed before so many things were connected to the Internet, and those creating new platforms that include security as part of the original design.

Read the full article about Allegis Capital’s new fund, including the two companies it has backed from it, at Dow Jones VentureWire.

Read More

Signifyd Announces $7M Series A Financing to Accelerate Growth of its Enterprise-Class E-commerce Fraud Platform

  |   Allegis News

Tim Eades (CEO vArmour Networks, former CEO SilverTail Systems) and Pete Bodine have joined the Board of Directors.

 

SAN JOSE, California, July 13 – Signifyd (www.signifyd.com), the fastest growing provider of fraud protection for e-commerce businesses, announced that it has raised $7 million in a Series A round of financing led by Allegis Capital with participation from Resolute Ventures, IA Ventures, QED Investors, Lucas Ventures and Tekton Ventures. This brings the company’s total funding to $11.2 million since it’s founding by two PayPal veterans. The new financing will be used to further accelerate growth and expand the engineering, sales and marketing teams. As part of the investment, Pete Bodine, managing director at Allegis Capital, will join the board of directors. Signifyd is also announcing the appointment of Tim Eades (CEO vArmour Networks, former CEO SilverTail Systems a cutting-edge fraud protection company acquired by RSA in 2012) as an independent member to the Board.

Signifyd solves the fraud challenges that e-commerce businesses persistently face: billions of dollars lost in chargebacks, customer dissatisfaction from mistaken declines, and operational costs due to tedious, manual transaction investigation. Signifyd’s technology not only tells retailers which payments to accept, but also guarantees these payments in the case of a chargeback.

“The chargeback process for merchants is broken and is clearly ripe for innovation,” said Raj Ramanand, Co-founder & CEO of Signifyd.  “The Signifyd platform marries behavioral psychology with machine learning to interpret user purchasing patterns.  It automates a process that takes customer service agents hours each day and puts a guarantee behind that automation.”   “Many companies have tried and failed to solve this problem with software alone.  Signifyd is different because of its financial guarantee.  We truly solve the problem,” added Michael Liberty, Co-founder & COO of Signifyd.

“Signifyd has the team and technology to transform this industry. Its product reduces friction, increases revenue, and lowers costs,” said Pete Bodine, Managing Director at Allegis Capital. “They’ve built a company focused on customer success with a real business model, growing revenue at 20% month-over-month. This investment will help the company achieve its goal of fundamentally reshaping the fraud protection and payments industry.”

“For years, the transactional analytics market has been begging for disruption. Online criminals are continuing to rack up millions in fraudulent dollars with ease. Now, Signifyd is equipped with the technology and leadership to fundamentally change the fight against online crime,” said Tim Eades, CEO of vArmour and former CEO of Silver Tail Systems. “The Signifyd platform guarantees payments for merchants, essentially turning online crime on its head. I can’t wait to help the company along the way as they scale their explosive growth and provide merchants with a product that solves some of the most complex problems they are dealing with today.”

Raj Ramanand, a veteran of PayPal and FedEx, and Michael Liberty, a veteran of PayPal and JPMChase, developed Signifyd.  They’ve laid the foundation for the company upon their deep fraud experience and passion for customer success. Signifyd already counts major enterprise and mid-market companies among its customers as well as some of the hottest e-commerce startups. For more information, please visit: www.signifyd.com.

About Signifyd

Headquartered in San Jose, CA, Signifyd was founded by Rajesh Ramanand and Mike Liberty, a team of veteran risk and fraud experts from PayPal, to help online businesses prevent payment fraud. Signifyd’s full-service cloud platform simplifies fraud detection through a financial guarantee, allowing businesses to increase sales while reducing fraud losses. Signifyd is in use by multiple companies on the Fortune 1000 and Internet Retailer Top 500 list. The Company is backed by top tier Venture Capital firms such as Allegis Capital, Andreessen Horowitz, Data Collective, IA Ventures, Lucas Ventures, QED Investors, Resolute.VC and Tekton Ventures. For more information about Signifyd, please visit http://www.signifyd.com. Follow Signifyd on Twitter @signifyd

Read More

RedOwl Secures $17 Million to Deliver Behavioral Analytics and Insider Risk Management to the Enterprise

  |   Allegis News

Allegis Capital Managing Director Robert Ackerman Appointed to Company’s Board of Directors

 

SAN FRANCISCO, July 13, 2015—RedOwl, a leader in insider risk management and security analytics, today announced it has raised $17 million in Series B funding led by Allegis Capital. The company will use the new funds to continue its expansion, further build out the product development and data science teams, and begin broadening its go-to-market efforts. Reveal, RedOwl’s flagship software program for insider risk management, is deployed across multiple verticals and used within many Fortune 500 companies including The Blackstone Group and K2 Intelligence.

This announcement follows a year of exceptional growth for RedOwl, during which the company nearly doubled its team by adding new data scientists and security engineers, and expanded internationally into London. The Series B round includes participation from Blackstone as an investor, as well as previous angel investors including Salesforce Chairman and CEO Marc Benioff, bringing the total funding amount raised to nearly $30 million.

RedOwl also announced today that Robert Ackerman, founder and managing director of Allegis Capital, has joined the company’s Board of Directors, further validating that RedOwl’s human-centric approach is necessary in addressing today’s advanced cyber threats. Existing Board members include Jay Leek, chief information security officer (CISO) of The Blackstone Group, and Elad Yoran, CEO and founder of Security Growth Partners, and a former advisor to the U.S. Department of Homeland Security and the FBI’s Information Technology Advisory Council.

“In 2014, as part of Blackstone’s overall security strategy, we set out to tackle the growing concern around insider threats. We reviewed over 15 different insider threat vendors and ultimately landed on RedOwl for many reasons; most importantly, the company was able to monitor disparate and multiple sets of unstructured data that were being overlooked by other insider threat solutions,” said Jay Leek, the Chief Information Security Officer (CISO) of Blackstone. “After bringing them on board to help secure Blackstone we realized that they provided many insights and had a unique value proposition which quickly led us to become a customer, followed shortly by us pursuing an investment in their organization. RedOwl has the potential to truly change the way we think about insider threats and security, focused on moving beyond the perimeter to securing the human-side of an organization.”

Intelligence-based Approach

A U.S. Army veteran who spent years working in military intelligence in Iraq and Afghanistan, RedOwl founder and CEO Guy Filippelli recognized parallels between the needs of large enterprises and his work developing first-of-its-kind data analytics software to provide commanders on the battlefield with vital information to make the most informed tactical decisions about the military’s biggest asset—people. Upon leaving the Army, Filippelli decided to extend that vision to building software that would give enterprise security the power of “situational awareness.” Rather than relying on one channel or data source, large companies in highly sensitive industries like financial services, healthcare and government use RedOwl’s software to understand what is happening at the human layer of the business and better manage risk via a multi-dimensional view across disparate data sources.

Through its unique human-centric approach to security, RedOwl allows companies to protect the increasing volumes of sensitive data now being generated and used by employees across the organization by identifying and analyzing changes, patterns and anomalies in user behavior. Companies use RedOwl to draw from multiple data sources in order to visualize what is happening at the human layer of the business, identify suspicious or risky behavior in real-time, and proactively identify where unforeseen risks reside within an organization.

“Organizations are responsible for the safety of the data they generate and collect, but each employee with access represents another layer of risk to the organization, be it through behavior that is careless, malicious or sloppy,” said Filippelli. “Our proprietary behavioral analytics software provides visibility into the human layer of the business, giving enterprise security teams the ability to identify patterns across disparate data streams and create actionable, situational intelligence that drives informed business decisions in real-time.”

Diverse Experience Across the Board

With the addition of Robert Ackerman, RedOwl’s board now includes leading security investors, seasoned industry experts who have developed and grown successful enterprise technology businesses and strategic advisors who understand that the company’s unique human-centric approach to security has the ability to change how their industries manage risk.

“Given that between 70 and 80 percent of cyber attacks have an internal component, the enterprise needs to shift its attention away from the perimeter and focus on monitoring insider risk. As Allegis Capital increases its investment in cutting edge security teams, RedOwl stood out as a company addressing a critical piece of the security puzzle—the people,” said Robert Ackerman, founder and managing director of Allegis Capital, which recently secured a $100 million fund to invest in additional cybersecurity ventures. “RedOwl has an experienced executive team that is approaching insider risk in an entirely new way, whether it’s an employee with malicious intent, a compromised employee or someone that is simply acting carelessly. We’ve been investing in the security analytics space for many years and RedOwl is ahead of the pack—they provide immediate value to companies of all sizes across all verticals, and we look forward to seeing them change the way the enterprise thinks about security.”

About RedOwl

RedOwl offers a cutting-edge analytical solution to security, compliance, and investigative use cases. RedOwl’s flagship product, Reveal, provides immediate value to forward-leaning organizations that understand the massive potential of their untapped internal data sources in improving oversight and reducing risk. For more information, visit www.redowlanalytics.com.

About Allegis Capital

Allegis Capital is a seed and early-stage venture capital investor in companies building disruptive and innovative cyber security solutions for the global digital economy. Founded in 1996, the firm has more than $700 million in capital under management and has been active in cyber security investing since 2000. For more information, visit www.allegiscap.com

Media Contact

Danny Schwartz

RedOwl

Danny@redowlanalytics.com

410.528.8397

Read More

ALLEGIS CAPITAL HOLDS FIRST CLOSE ON $100M CYBERSECURITY FUND: ALLEGIS VI

  |   Allegis News

Early-Stage Venture Firm Puts Capital to Work In Huge Investment Opportunity
Two New Investments Already Committed: E8 Security and Signifyd

PALO ALTO, Calif. (July 1, 2015) — Allegis Capital, a nearly two decade-old diversified seed and early-stage venture capital investor in technology startups, is announcing the first close of Allegis VI, a $100 million early-stage fund committed to cyber security investments, the firm announced today.

In addition to targeting cyber security startups, the $100 million – committed from new and current investors – will also be used to invest in related companies in data analytics, the Internet of things (IoT) and virtualization, all areas in which Allegis has been investing for more than 10 years. The fund will invest both in companies that secure legacy computing infrastructure and next-generation computing platforms in which security is inherent in the design. ACG Partners projects an 11 percent annual compounded growth rate of cyber security spending, reaching $140 billion in 2018.

Allegis has already made two new investments under the aegis of its new fund in E8 Security and Signifyd. E8 is developing an advanced threat detection technology that bypasses preventive controls and rule-based monitors. Signifyd protects online stores by scoring hundreds of risk indicators to ensure transactions are legitimate.

Allegis also made cyber security investments in the last 24 months in Bracket Computing, vArmour, Shape Security, Area 1 Security, Synack, Platfora, Moki Mobility and E-File Cabinet.

Allegis has focused on cyber security startups, albeit not exclusively, since 2000. Past portfolio companies have included IronPort Systems, an email security firm that was acquired by Cisco Systems for $830 million, and Solera Networks, which was acquired by Blue Coat in 2013.

Limited partners who are funding the effort include institutional and strategic investors and new investor capital includes global pension funds.

 Cyber Investing Offers Huge Opportunity

There is “a substantial need for new and promising cyber security startups and a huge investment opportunity in them,” said Allegis Founder and Managing Director Robert Ackerman.

“The digital security landscape is global, dynamic and continually evolving as ‘bad actors’ look to compromise information technology networks to achieve their nefarious goals,” Ackerman said. “Hacktivists, criminals and state actors are all involved in a never-ending barrage of increasingly sophisticated attacks on networks that the global digital economy relies upon for all aspects of daily life.

“Hardening and securing these networks to protect consumers, businesses and governments and the information they manage requires continual innovation,” Ackerman added. “And much of that innovation originates in the world of startups.”

Ackerman will invest with long-time colleagues Spencer C. Tall and Pete G. Bodine, also managing directors.

Allegis Venture Partners Have Expertise in Cyber Security

The Allegis investment team also includes five prominent venture partners. They are Nawaf Bitar, senior vice president and general manager of the cloud platform business unit of VMware; Tom Gillis, founder and CEO of Bracket Computing; Todd Rowe, managing director of global channel sales at Google; Jeff Williams, senior vice president of worldwide sales and business development at FireEye; and Jean-Louise Gassée, a long-time Allegis partner and founder of Be Inc., the creator of the BeOS computer operating system.

Gassée was a former executive at Apple Inc. Bitar, Gillis and Williams were all former operating executives of Allegis cyber security portfolio companies.

Ubiquitous Cyber Attacks

Chronic news reports demonstrate the breadth and depth of successful cyber security attacks. “Over just the past two years, some of the most significant corporations and government entities in the world have been compromised at an unprecedented scale with hundreds of millions of sensitive data records stolen,” Ackerman said. “Successful cyber attacks targeting the U.S government’s Office of Personal Management, Adobe, E-Bay, Target, Home Depot and JP Morgan, among others, demonstrate that no person, corporation or government entity is immune from these threats.

Data-Breach-Chart-WO

 

With the world’s information now largely in digital form and with much of it accessible over the Internet, the cyber security threat is growing at an exponential rate, Ackerman said. In addition, vast quantities of new data are being created every day, making it nearly impossible to keep up with security and private needs using existing technology. ACG Partners projects an 11 percent annual compounded growth rate of cyber security spending, reaching $140 billion in 2018.

“Allegis Capital’s extensive experience in cyber security investing is crucial to our success,” Ackerman said. “It provides the domain knowledge, access to entrepreneurs and customer relationships required to find, invest in and develop the next-generation of best-in-class technology to protect global digital infrastructure.”

About Allegis Capital

Allegis Capital is a seed and early-stage venture capital investor in companies building disruptive and innovative cyber security solutions for the global digital economy. Founded in 1996, the firm has more than $700 million in capital under management and has been active in cyber security investing since 2000. For more information, visit www.allegiscap.com

Contact: Jennifer Jones 650-465-5831 jennifer@jenniferjones.com

Download Read More

The forgotten story of the iphone released in 1998

  |   Allegis News

by Brian McCullough – internethistorypodcast.com – June 21,2015

Remember this?

So, three things: a widescreen iPod with touch controls; a revolutionary mobile phone; and a breakthrough Internet communications device. An iPod, a phone, and an Internet communicator. An iPod, a phone— are you getting it? These are not three separate devices. This is one device, and we are calling it iPhone. Today, Apple is going to reinvent the phone.

– Steve Jobs, January 9, 2007

It turns out that almost exactly 9 years before Steve Jobs spoke those words and introduced the world to the iPhone, there was another 3-in-1 device that was introduced to the world, and it just so happened that that device was also known as an iPhone. But the company that brought the “first” iPhone to market, all the way back in 1998, was called InfoGear, not Apple.

Here’s the story…

The iPhone that came before Apple’s iPhone

In the late 1990s, there was a fad for devices called “Internet appliances.” The idea was to have smaller, purpose-designed devices that would allow users to jump on the web and do web things without having to whip out a laptop or a PC. Remember, this was back in the day when laptops could still be 10 pound affairs.

So, the industry envisioned smaller devices that you could put on your desk, in your kitchen, maybe on your wall, that would allow you to check your email, browse the web, as a quick and easy, in-and-out affair.

A skunkworks project for just such an “appliance” was started in 1995, inside, of all places, National Semiconductor. Three engineers, Chaim Bendelac, Yuval Shahar and Reuven Marko were given company funds to explore the possibilities for a product that would be part internet, part telephone. They called their brainstorm “Project Mercury.”

At around the same time, a venture capitalist by the name of Robert Ackerman, was consulting with National Semiconductor. Toward the end of a routine meeting, Ackerman’s hosts offered to show him around the engineering lab. It was there that Ackerman would first see …

> Read Article

Read More

eFileCabinet Review: Best Mobile Document Management

  |   Portfolio News

By Chad Brooks, Business News Daily Senior Writer June 3, 2015 02:04 pm EDT

 

After much research and analysis of document management systems, we recommend eFileCabinet Online as the best document management system for businesses with a remote workforce. Ready to choose a document management system? Here’s a breakdown of our complete coverage:

Document Management System Buyer’s Guide

Roundup: The Best Document Management Systems

REVIEW: Best for Small Businesses

REVIEW: Best for Businesses on a Budget

REVIEW: Best for Businesses Using Windows

REVIEW: Best for Businesses Using Macs

Why eFileCabinet Online?

Remote Access
eFileCabinet Online can be used from any location. Unlike on-premises systems that that need to be specially configured to be accessed from outside the office, this cloud-based solution is easily tapped into from any computer with an Internet connection. This gives your employees full access to the system, whether they’re working in your office, from home or any other remote location.

What’s nice is that eFileCabinet Online allows employees to have access to the entire system, not just pieces of it. While some of the other systems we analyzed offered remote access, not all of them provided full functionality from outside the office. This system works exactly the same regardless of where you’re working.

> Read Article

Read More

IMVU’s virtual rooms are ready for social VR

  |   Portfolio News, The Latest

May 20, 2015 9:30 AM
Dean Takahashi, VB Gamesbeat

IMVU was founded in 2004, back when virtual worlds like Second Life were the hottest thing. They’re not as hot any more, but IMVU has figured out how to survive and adapt. And now it’s getting ready for the renewed excitement about virtual reality. The Mountain View, Calif.-based company has had more than 111 million people register over time, and it still has 3 million monthly active users. Those users create their own 3D characters, or avatars, and build static 3D rooms where they can entertain friends in a kind of virtual metaverse.

It isn’t full of interactivity or movement of 3D animated figures like you would find in a game. But all of IMVU is already formatted in a way that it can be viewed in virtual reality via goggles such as Facebook’s Oculus Rift. I visited the company recently and saw demonstrations of the VR environments.

“Creativity is really at the heart of the world for us,” said Brett Durrett, chief executive of IMVU, in an interview with GamesBeat. “We see that virtual reality can be the future of social. We call it social VR.”

VR is going to be one of the bets that Durrett is making for the social world of IMVU, and it’s one of his interesting moves since taking over as permanent chief executive last year. He joined the company in 2005, and he replaced previous CEO Cary Rosenzweig.

> Read Article

Read More

The Most Common Reasons Startups Fail.

  |   Entrepreneur Resources

BEFORE DIVING INTO YOUR OWN STARTUP, CONSIDER FIRST THESE COMMON MISTAKES THAT HAVE COST ENTREPRENEURS THEIR BUSINESSES TIME AND AGAIN.

By Trin Linamagi – fastcompany.com

Founders blame investors, investors blame CEOs, CEOs blame research and development (R&D), R&D say the product is fine, the market just doesn’t get it, and marketing people blame it all on the recession. Some startups succeed, yet so many fail, and it’s failure that teaches us the best lessons. What are the main reasons why startups fail? In a survey carried out by tech blog ArcticStartup and CoFounder magazine, more than 100 startup entrepreneurs share their experiences and lessons learned.

1. THE TEAM DOESN’T HAVE WHAT IT TAKES TO SUCCEED

A startup’s biggest challenge is getting the team right, according to 37% of the founders surveyed. Having enough diversity for a variety of skills that are needed to succeed from day one is essential. Not less important is trusting your team and giving them control over their responsibility areas.

There’s a reason why all the top investors and incubators place such heavy emphasis on the team. Ideas change, products pivot, markets can take unexpected turns, but people are what hold everything together. A great team is not just about selecting a group of smart people; it’s about complementing each other’s strengths and mitigating each other’s weaknesses.

As a founder, you must attract and retain the right people to build the technology, understand your industry, and scale your company.

2. THE IDEA IS NOT SERVING THE MARKET NEED

Sometimes the market simply isn’t there yet. Of the surveyed entrepreneurs, 20% said their startup failed most likely because of the product market fit. The biggest mistakes startups make are not talking to enough prospects before diving in and not understanding the target market, which might result in focusing on multiple ideas rather than one main idea.

Consumers are highly resistant to change and biased against trying a new product. Founders tend to believe their product is great since they’re always the first to try new products themselves. But mainstream consumers might not always understand why or how to use the new products. In this instance, startup entrepreneurs might think the market should change to fit their vision, but this thinking ignores the market realities.

3. RUNNING OUT OF CASH TOO FAST

Cash isn’t everything when it comes to starting a business, but when you run out of it, there’s not much that can help, according to 13% of the surveyed startup founders. Google and Facebook can afford taking risks on their cash by dedicating a fraction of it to crazy ideas, but small startups can rarely afford this.

Many businesses that fail aren’t insolvent or even unprofitable, they just run out of cash. Once you have a viable business model, managing your cash flow is the single most important thing you can do. It doesn’t matter how much cash you raise, without revenue generation you will eventually run dry. The biggest mistake to be made is carelessly spending money on features that are not needed or spending your marketing budget with no control on measuring what you are getting back.

4. NOT BEING ABLE TO SUPPORT GROWTH

Things could go smoothly for a while, that is until you decide to scale up. Ten percent of respondents said their startup failed because of the growth problems.

When you’ve built a business model that works only up to a certain size, your model can’t sustain growth. Sometimes you must change your model sooner than expected. The founders who are not flexible, who are stuck in their own stubbornness, and who don’t think ahead, will end up being their own downfall even if the startup was successful.

5. POOR ALLOCATION OF RESOURCES AND MONEY

Where startups often fail is not having a proper plan in place about how many people they need to hire, when is the right time, and which teams should be invested in at the first stage.

Startups that run out of resources also usually do so because the founders don’t want to give up a piece of the pie, the budgets were not planned properly, the burn rate was too high, or it just took longer to raise the first round than initially expected.

6. NOT REALIZING THE COMPETITION IN THE MARKET

How often have we heard, focus on your own thing instead of getting distracted by the competition? This does not mean, though, that you should ignore the competition.

Where startups go wrong is believing they are the only ones with the great idea and going out there without proper competitor research. Ignoring the competition is a recipe for disaster in 19% of startup failures.

As Peter Thiel suggests, ask yourself what you’re doing that no one else is doing. Or if someone is not doing it well enough, what are you doing differently to win the market?

7. IGNORING CUSTOMERS

The tricky question has always been whether entrepreneurs should open up shop for testing or spend a few more months making it perfect. First talk to your customers and then develop your product according to your market need. That’s where many startups go wrong.

When you don’t validate your market aggressively enough, you can’t build a good product. Without measuring, trusting the numbers, tracking, validating, and optimizing the data you get from your clients, it’s not possible to create a viable product in high demand.

There are many other reasons startups fail, but these seven came up as most common when questioning the founders and team members involved with the startup ecosystem. Should your startup fail, it’s worth spending some time to understand what went wrong and learn from your mistakes to make it next time.

Read More