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The Recipe For Startup Failure

Jan 28, 2016

This question originally appeared on Quora: Why do so many startups fail? Answer by Keith Rabois, Internet entrepreneur, investor & contrarian. General Partner, Khosla

Keith Rabois
Keith Rabois

90% of the time consumer Internet companies fail for one reason: Inability to acquire and retain a substantial number of users.

In isolation the founders can articulate a reasonable value proposition, but in the real world cutting through the clutter of the 3,000 advertisements per day that the average American is bombarded by is extraordinarily difficult.

There are only 24 hours in a day and most are already claimed by family obligations, work, sleep and existing entertainment options; even if you get a user's attention your new product needs to be so compelling that he is willing to forego something else he is already invested in.

To be truly successful on the Internet, you need to build something that becomes one of seven sites that a large swath of users will regularly use. Quite difficult.

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