- When market research shows there is no need for your product
Reality changes, and with it so does the market. What is sought after yesterday is different than today, and will definitely be tomorrow. If you’ve walked inside of a mall in the past 20 years, you know this to be true. Just as entrepreneurs change reality, they change the market. Your product either needs to do just that, or satisfy what the market demands.
- When it breaks your family
Not all entrepreneurs are single and dedicate 20 hours per day to their business. Some of the best entrepreneurs have families, and those families become their motivation for succeeding. Do not forget to make a life while you are making a living. Creating a better life for your family includes hard work and quality time with them. Successful entrepreneurs who want long-term business and personal success invest time and money not only into their startup, but also into their family. So if your family is at a breaking point, it might be time to give it up.
- When you realize there are others already doing it, but better
The opposite of an unneeded product or service is satisfaction with its current existence. If you log in to any app store on your phone, you will find knockoffs to every popular app out there. They’re easy ways to ride on the coattails of something popular—like getting people who already play Angry Birds to want Poultry Pal. This might work in the short term, but it’ll be an uphill battle in the long term.
- When it’s a brand new business model that has never even been tried
Uber did not create the need for people to pay for local, private transportation. It disrupted the market by doing it better. Often, the best startups are simply re-workings of already existing industries, creating better alternatives. Complaints about the taxi-riding experience were solved with Uber and Lyft. Similarly, the smartphone of today exists because it consolidated a variety of devices that had all at one point been single-purpose, handheld devices. While a brand new model may create a need that didn’t exist before, thereby altering reality, businesses that are too far removed from the market will fail.
- When risk outweighs reward
If a business is to be profitable, the outcome of success must weigh equal to or greater than the risk. The reason you see a million Subway restaurants is because they are inexpensive franchises that aren’t costly to maintain and already have brand awareness in the market. If it costs more to bring the product or service to market than the potential it can bring, move on.
- When you find you no longer believe in the cause or root reason for the business
Pride can get you wrapped so far into the endeavor that your reason behind doing it no longer exists. Successful entrepreneurs are gritty folks, but their grit isn’t just a personality trait. You can draw a direct line from successful startups to a founder who truly believed in the reason for the company. That’s what sees founders through the dark times.
There are no single warning signs or stop signs to your business. Several of them come up at once or converge. It’s a game of Whack-A-Mole. Startups face challenges, and growth is hard. Sometimes it will hurt your family, and sometimes it will simply seem bleak. But when you constantly stay on alert, and realize that too many issues converge, be wise, and know that it’s time to give up and get out.
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