During the most recent U.S. recession, Mike Kappel found himself in a difficult position. He was a serial entrepreneur and the founder and CEO of Patriot Software Company. And he was running a failing business. In a 2018 Forbes article, Kappel recounts the lessons he learned during that time. He writes, \u201cNobody wants to talk about a failing small business. But I\u2019m here to tell you that business failure is a reality.\u201d It was 2008. The market had tanked. New business was hard to find, and jobs were scarce. Kappel\u2019s startup, Career Marketplace\u2014 an online intermediary for job seekers and job creators\u2014 was struggling. \u201cAfter a few rough years and many tough decisions I was able to save the business,\u201d Kappel reflects in a 2019 article for Entrepreneur. \u201cBut when it was all said and done, it wasn\u2019t the economy or the job market that hurt Career Marketplace. It was my departure from common sense business principles.\u201d Each year, thousands of entrepreneurs start new businesses. Perhaps you\u2019re one of them. If so, you already know that deciding to launch a startup is no small undertaking. You want to fill a niche in your community. Or you\u2019re following your passion. Either way, entrepreneurship requires determination, strategy, and a strong vision. Unfortunately, according to the Startup Genome Report, 92% of startups fail within three years. For some industries, the odds of success are even more daunting. CB Insights found that up to 70% of tech startups fail, and 97% of consumer hardware startups die or become \u201czombies.\u201d Luckily, there\u2019s plenty we can learn from these failures. So, why do startups fail? It\u2019s a big question. Entrepreneurs face countless obstacles in the modern economic landscape. Tim Chae, a General Partner at 500 Startups, traces most failures back to three factors: the market, the culture, and leadership. The market, or failing to solve a market problem Startups identify consumer pain points and create products to address them. But in today\u2019s global economy, markets change rapidly. By the time you\u2019re ready to launch, your product may already be obsolete. Worse, maybe it was never needed in the first place. Understanding the market, your audience, and your product ensures that your startup isn't dead on arrival. According to an article by Inc., this knowledge may be the single most important factor in predicting startup success. They cite a report by CB Insights that found 42% of failures stem from a poor understanding of the market. The article claims, \u201cThe biggest mistake you can make as a startup founder is to create a product or service that doesn\u2019t solve a big enough problem.\u201d Market readiness The other issue that many startups face is trying to rush their market readiness. Capital is not enough to keep your startup afloat. If you launch an unprepared product, you\u2019ll either be unable to keep up with your own growth or your startup won\u2019t hold its weight in the public sphere. Be realistic. Know your limitations. One cautionary tale is the GoCrossCampus (CXG) game\u2019s incredible failure. This multiplayer strategy game was a digitized, real life Risk. Students coordinated with allies to \u201cconquer\u201d other college campuses. The game raised over $1.6 million in venture capital funds, had a stellar team of developers, and launched with 1,000 active users. It still failed. Why? Company founders Hargreaves and Brimer\u2019s felt pressure to release the product before it was ready. In an interview with Business Insider, Brimer reflects, \u201cLooking back, many things felt so damn rushed.\u201d The company\u2019s momentum became their biggest problem. \u201cWe had 1,000 active users per day but had to shut down the site right around Thanksgiving. Our servers couldn\u2019t take it.\u201d The site stayed down for six weeks. Shortly after that, Hargreaves was named \u201cthe most hated student on Yale\u2019s campus.\u201d Looking back, the founders regret launching before they knew their servers\u2019 capacity. \u201cWe should have spent the fall working on the project and then launched in the spring.\u201d Because they rushed the product to market, a game that the New York Times lauded as \u201cthe next Internet phenomenon\u201d crashed and burned before take off. Employees and company culture CB Insights also discovered that seven of the top 20 reasons startups fail tied back to employees or company culture. From founding members to investors and employees, the entire company should align across all channels. Part of establishing your company\u2019s culture is creating a shared, unified vision. Where is the company going? What are you trying to accomplish? What are the tangible results of your team\u2019s success and how can you use them to keep employees motivated? Having frequent success markers keeps your team engaged and on track. The consequence of getting off track? A scattered, distracted team with no unifying purpose. This was ultimately what derailed MyFavorites, a startup that billed themselves as \u201cthe like button for everything.\u201d In their postmortem, founder Steve Poland observed, \u201cUltimately\u2026 we all started losing interest. The team was all wondering where this was eventually going.\u201d Detailed, achievable goals and a clear vision of the company\u2019s future keep everybody pulling in the same direction. Leadership If you\u2019re starting your own business because you want to work less, save yourself the expense and heartache. As the head of a startup, your responsibilities grow exponentially. On top of running the business and handling daily operation, you get to empower employees and create strong teams. Unfortunately, a lot of problems stem from inefficient leadership. As a company\u2019s leader, you need to be able to predict and manage issues, while keeping realistic expectations in the face of incredible challenge. Prepare for worst-case scenarios Plenty of factors might derail your success before, during, and post-launch. Financial planning is important\u2014you should always have an emergency fund on hand. But CB Insights found that money shortages comprised only two of the top 20 reasons startups fail. Changing markets, managing personnel, and PR fallout are much more likely obstacles. Planning for these is as important\u2014if not more\u2014as an emergency cash reserve. Speaking from his own experience, Mike Kappel encourages business owners to run through worst-case-scenario strategies ahead of time. \u201cSometimes your products or services go stale and you receive an influx of negative reviews. Or, your marketing strategy might not be reeling in enough customers. You should have a business plan for small business in place to help you focus your strategy and increase traffic to your company.\u201d Face issues head-on When things start to get rocky, it can be tempting to look the other way. Unfortunately, denying that your startup is in trouble won\u2019t help anything. The faster you identify and correct issues, the sooner you can address them and turn things around. Systemic problems are like an infection: the longer you ignore them, the less likely you are to recover. Ask for advice You\u2019re not the first person to face the challenge of launching a startup. Nor will you be the last. One of Kappel\u2019s most earnest bits of advice? Ask for help from the right people. \u201cOther small business owners have been in your shoes,\u201d he assures. \u201cThey can lend you some of their expertise so you don\u2019t make the same mistakes as them.\u201d But other business owners aren\u2019t the only resource available to you. Advice from accountants, lawyers, and even industry mentors can go a long way towards setting you on the right track, and digital marketing agencies keep your company on-brand and visible. They have years of experience and expertise to help you navigate the startup landscape. Don\u2019t fear failure Advice articles for entrepreneurs blast the same sentiment again and again: \u201cFailure is inevitable. Embrace it.\u201d While that\u2019s true, it should come with an addendum. Failure is only useful if you learn from it. Keeping a startup afloat is not a yes or no thing. It\u2019s a process that requires frequent adjustments and tweaks. The startup world is full of failures, and your willingness to become one of them could be the key to your eventual success.