Nearly 90% of startups fail, with a significant portion faltering due to avoidable product mistakes. Starting a tech startup is exhilarating, but it’s also full of potential pitfalls. First-time founders often encounter key challenges that slow progress, drain resources, and ultimately impact the trajectory of their companies. Have you ever wondered why so many promising startups stumble? Whether it’s misjudging the market or over-engineering a solution, these mistakes often boil down to simple oversights.
I’ve spent the last two decades working in product and UX. Many of those 20 years I spent as a Product Leader – driving innovation, building high-performing teams, and fostering collaborative environments.
I’ve had the privilege of mentoring, advising, and working with dozens of tech founders. My expertise in leading product strategy initiatives, navigating complex technological landscapes, and fostering user-centric design has consistently revealed recurring patterns in the challenges founders face.
These patterns often highlight how small oversights can snowball into major obstacles or how unconventional approaches yield the best results. This article draws from those experiences to highlight five common mistakes and offers actionable advice on how you can avoid them.
Contents
1. Perfection Over Engagement
Far too often, early-stage founders waste precious time, energy, and money trying to perfect their product before launching. They aim for a big, polished debut when, in reality, starting smaller often leads to better outcomes. A less-than-perfect product or experience that allows potential customers to interact with it can provide invaluable insights—helping you gauge their appetite to pay for or use something like it.
The smarter approach is to focus on delivering value early. You could build an Minimal Viable Product (MVP), but I would encourage you to take it a step further with a Minimal Viable Experience (MVE). While an MVP centres on functionality, an MVE is more holistic, incorporating not only functionality but also a glimpse of the experience, brand, and vision behind your product. This approach ensures that early users connect emotionally and practically with your solution.
As Reid Hoffman famously said, “If you’re not embarrassed by the first version of your product, you’ve launched too late.” But the goal isn’t just to launch quickly; it’s to launch thoughtfully. An MVE combines speed with impact, showing potential users not just what your product does but how it feels to engage with it.
Take Airbnb’s early days as an example. The founders didn’t wait to build a sophisticated platform. They started with a simple website and a spreadsheet to validate their idea. This early engagement wasn’t just about testing functionality—it was about understanding how users experienced the process. That feedback helped them refine their offering into what it is today.
By choosing to build an MVE, you position your startup to gather actionable insights, create meaningful connections with early users, and set the stage for iterative growth. It’s not about launching perfect—it’s about launching purposefully.
Getting Started with Your Minimum Viable Experience (MVE) in 3 Steps
Creating a Minimum Viable Experience (MVE) involves delivering a simple yet impactful version of your product that demonstrates its core value to users. Here’s a three-step process to achieve that.
1. Define the Core Value Proposition
Focus on the single most valuable solution your product offers.
- Understand Your Users: Identify the primary pain point or need your target audience faces.
- Articulate the Core Benefit: Define a main user journey and what success looks like for the user after interacting with your product. In short, how using your solution solves their main problem.
- Prioritise Features: Choose the absolute minimum functionality required to deliver this value effectively. Personally I combine the MoSCoW framework with the Impact and Effort to get a grounded view on what we will develop and what we will not be delivering in our MVE.
Tip: Use frameworks like the Value Proposition Canvas to align your product’s offerings with user needs, so you can get to your Must, Should, Could and Won’t haves (MoSCoW).
2. Design a Simplified User Journey
Map out a straightforward and intuitive path for users to experience the product’s core value.
- Sketch the User Flow: Identify key touchpoints where users interact with your product and remove unnecessary steps.
- Focus on Delight: Ensure that the journey feels smooth, avoiding friction or overwhelming complexity.
- Build for Feedback: Include elements that allow users to provide insights on their experience.
Tip: Use wireframes or rapid prototyping tools like Figma or Sketch to iterate quickly on designs.
3. Test, Measure & Iterate
Launch the MVE to a small, targeted audience and gather data to refine the experience.
- Validate with Real Users: Share the MVE with early adopters who match your target persona.
- Track Key Metrics: Use analytics tools to monitor engagement, retention, and satisfaction. The traditional advise here would be to use metrics like DAU/MAU (Daily/Monthly Active Users) and Net Promoter Score (NPS), but what we have seen consistently is that Time to Value is the key to success: how much time does it take for your users to achieve their goal? Are they able to get to the finish line on their own and do it in a time they feel is fast or reasonable? These will be the key questions for you to track, as everything else will be a consequence of this. People use you solution to be successful, to get what they need, so the easier it is to achieve it with a good experience, the better they will feel about your product and the more they will trust you with their engagement. The goal is to convert most of these users into potential evangelists who will spread the word about how good your solution is.
- Iterate Rapidly: Act on feedback to fix issues, improve usability, and expand functionality if necessary. Again, this is the needed follow-up to build on top of that initial good impression and trust.
Tip: Platforms like Hotjar or Mixpanel can provide behavioural insights during testing.
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2. Assume Before You Ask
It’s a common trap: founders with industry experience think they know everything about their users. They spot an opportunity based on their career and dive in, assuming they understand how people will interact with their product. But this often leads to missteps that could have been avoided with more user interviews or pitch selling. Taking the time to ask questions upfront gives you first-hand insight into your users’ willingness and desires.
By conducting user interviews and gathering direct feedback, founders can uncover surprising insights that reshape their understanding of user needs.
Instead, validate your assumptions through direct user research. Conduct interviews, pitch your concept, and listen carefully to feedback. You’ll uncover insights that challenge your expectations and help you design a product that truly resonates with your audience.
Conducting Early-Stage User Research to Validate Assumptions
Research has shown that products developed with extensive user feedback are 2.6 times more likely to succeed in the market. Incorporating structured user research early not only validates assumptions but also ensures alignment with real-world needs, increasing your product’s chances of success.
Start by creating a list of target users based on your product’s value proposition. Prepare a set of open-ended questions to uncover their pain points, current solutions, and unmet needs. Use platforms like LinkedIn or industry forums to recruit participants. Record the interviews (with permission), synthesise the insights, and identify recurring themes to guide your product development.
3. Pitching to Clients Like You Would Investors
This is a mistake I’ve seen not just in startups but even in scale-ups: founders using the same deck or pitch for both investors and clients. Remember, investors care about how they’ll make money with your idea, while users are focused on how you solve their problem. Tailor your approach. For clients, demonstrate the outcomes your product delivers and how it addresses their needs. Clients don’t care about your revenue model—they care about their pain points.
According to Salesforce, 73% of consumers expect companies to understand their needs and expectations, underscoring the importance of addressing client-specific pain points in successful sales strategies.
When pitching to potential clients, shift your focus from metrics to outcomes. Emphasize the value your product provides, highlight the problems it solves, and demonstrate how it will improve their lives or businesses. Users buy solutions, not business models.
How to Tailor Pitches for Clients vs. Investors
Create separate decks for investors and clients. For client presentations, emphasise how your product addresses their pain points with specific examples or success stories. Highlight use cases, cost savings, or efficiency improvements. For investors, focus on metrics like market size, scalability, and projected growth. Tailor your messaging with visuals, testimonials, or ROI calculations relevant to the audience.
4. Overengineering Too Early
Here’s a surprising truth: many founders overcomplicate their solutions without realising simpler alternatives might already exist. It’s shocking how often a basic Google search or a well-prompted conversation with AI tools like GPT could save time and prevent over-engineering. Focus on solving problems people actually have and are willing to pay for.
Simplicity often wins over complexity. For example, Dropbox’s MVP was a simple video demonstrating how the product worked, which attracted thousands of users without requiring a fully functional product. This approach saved time and resources while validating the concept effectively.
Before building, conduct a quick market review. Explore existing solutions and identify gaps that your product can fill. Tools like a basic Google search or prompt-based conversations with AI can uncover existing alternatives and help you refine your approach.
How to Research Competitors and Identify Market Gaps for Your Startup
Before diving into development, allocate a full day to researching competitors and market trends. Use tools like Google Trends, Crunchbase, and industry-specific directories to understand existing solutions. Analyse competitor reviews to identify pain points in their offerings. Additionally, use AI tools to brainstorm unique features or improvements that differentiate your product, and validate these ideas through surveys or focus groups.
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5. Losing Focus
Repeat after me: “I will not lose focus! I will not lose focus!” According to CB Insights, 13% of startup failures are directly attributed to losing focus, highlighting how critical it is to stay aligned with your goals and avoid unnecessary distractions.
Setting your mission, vision and strategy early on, provides you with the right foundation for you to revisit any time you need to change your rational, but also gives you the mantra to follow and re-center you to avoid any type of bias or early temptation to try multiple things. At Altar we have been using our own version of this that we have been calling the Product Heart Statement, which is just our fancy name for a one page combination of mission, vision and strategy, that is simple to build, but super useful as a working tool you can revisit.
The popular “spray and pray” method—trying everything and hoping something sticks—is one of the worst pieces of advice a founder can follow. Pivoting is part of the journey, but it should come from rational insights, not impulsive reactions.
Avoid distractions, learn quickly, and adapt based on validated data rather than fleeting conversations or second guesses. Staying focused is your best weapon against unnecessary derailments.
Stay grounded in the data you gather. Use validated insights to guide your decisions and pivot only when it aligns with clear evidence. This disciplined approach will help you build a stronger, more cohesive product and company.
Using Decision-Making Frameworks to Stay Focused as a Founder
Use a decision-making framework like the Eisenhower Matrix to categorise tasks into urgent, important, or optional.
Schedule weekly review sessions with your team to align on progress and challenges. Establish KPIs to evaluate the impact of any pivot or strategy shift. Ensure every major decision is backed by a combination of user feedback, market data, and financial metrics to maintain focus and momentum.
Final Thoughts
Founding a startup is a journey unlike any other. It demands resilience, creativity, and a willingness to learn—often through trial and error. These challenges, however, are what make the journey so rewarding. You’re building something from scratch, solving problems that matter, and shaping the future.
Yes, the road is filled with hurdles, but those hurdles also bring invaluable lessons. The key is to stay curious, seek feedback, and never lose sight of why you started in the first place. Avoiding these common mistakes can save you time and resources while helping you focus on what truly matters: delivering value to your users.
Every startup is different, but by embracing these principles, you’re setting yourself up not just to survive, but to thrive. Keep learning, keep iterating, and remember—it’s the bold who change the world.
