10 reasons startups don’t make it (unless they fix this)

Last week StealthX hosted Product Jam, a full-day workshop experience focused on helping early-stage startup founders in NC define where to play in their market, how to win, and quickly putting together a prototype and action plan to test.

We held a panel discussion with an incredible group of founders and investors to discuss what separates winning startups from the ones that never make it. The panel included:

• Charles D’Andrea – Co-founder & Managing Partner, Pattern50 (Moderator)

• Harold Hughes – Co-Founder & CXO, Catalyst Labs

• Winston Len – Managing Partner, Equator Venture

• Justin Witz – Founder & CEO, Catapult

• Olga Ryzhikova – Founding Partner, Kepler Team

Their collective experience spans launching, scaling, and investing in startups across multiple industries. A core theme from discussion was that most startups don’t fail because they have a bad idea. They fail because they don’t test, iterate, and adapt fast enough. Here are the top 10 biggest takeaways from the panel that every founder should keep in mind.

1. Fall in love with the problem, not the solution.

Too many founders get emotionally attached to their product instead of why it needs to exist. You’re not building a product. You’re solving a problem. If you’re too rigid in your approach, you risk missing what customers actually need.

Putting this into action:

• Focus on the pain points your customers are facing, not just your vision for the product.

• Be willing to pivot if early feedback shows a different path to solving the problem.

• Regularly challenge your assumptions and ask, “Is this the best way to solve the problem?”

2. Your first product should make you slightly uncomfortable.

If you’re not at least a little embarrassed by your first version, you’ve waited too long. Perfect doesn’t exist. Launch early, get real-world feedback, and iterate fast. Waiting for perfection usually means building something no one actually wants.

Putting this into action:

• Ship your MVP as soon as it delivers core value, even if it’s not perfect.

• Get real users interacting with your product as quickly as possible.

• Measure engagement and refine based on user behavior, not just opinions.

3. Don’t fake traction. It will burn you.

Saying, “Google is a customer” because someone from Google visited your website is not traction. Over-inflating your success to investors, employees, or partners can backfire fast when the truth comes out.

Putting this into action:

• Be transparent about where you are in your growth journey.

• Build meaningful customer relationships instead of chasing vanity metrics.

• Track and share real, measurable traction. Whether it’s revenue, engagement, or referrals.

4. Get real feedback, not just “nice” feedback.

Your friends and family will always say your idea is great because they don’t want to hurt your feelings. The real test? Send them a prototype, don’t tell them it’s yours, and ask if they’d invest $5000 in it. Or tell them you’re considering investing $5000 in it and see what they say. You’ll get much more honest feedback.

Putting this into action:

• Get product feedback from people who don’t know you and have no reason to be polite.

• Ask direct questions that force people to challenge your assumptions.

• Test pricing and value by asking for commitments, not just opinions.

5. NDAs are useless for startups.

If you’re afraid to share your idea because someone might steal it, you’re thinking about it wrong. Execution is everything. If your advantage is just "having the idea," you don’t have an advantage.

Putting this into action:

• Talk to as many people as possible to refine your idea.

• Get feedback from potential customers instead of keeping things secret.

• Focus on speed and execution over guarding your idea.

6. There’s no overnight success.

The myth of the overnight $25M startup is just that, a myth. Even the biggest companies took years of relentless execution before they saw explosive growth.

Putting this into action:

• Set realistic expectations about the time required to build something great.

• Focus on sustainable growth, not just short-term wins.

• Celebrate progress and small wins along the way.

7. Investors fund lines, not dots.

Most founders pitch investors too late. Investors want to see progress over time, not just a polished pitch deck. The best way to secure funding is to build relationships before you need the money.

Putting this into action:

• Start conversations with investors early, even if you’re not raising yet.

• Send monthly updates to potential investors to show consistent progress.

• Focus on execution. Investors fund momentum, not ideas.

8. Celebrate employees when they come in and when they leave.

No one is as invested in your company as you are, and that’s okay. Treat employees well from day one to their last day because great people come back, and bad exits can haunt you.

Putting this into action:

• Be transparent with employees about business realities.

• Make every exit a positive experience. It impacts your reputation.

• Keep doors open for great talent to return in the future.

9. Your first big win probably won’t come from a product feature. It’ll come from a relationship.

A single intro, mentor, or investor can change everything. Product tweaks help, but the right connection can shift your trajectory overnight.

Putting this into action:

• Build and nurture strong relationships. Networking isn’t optional.

• Find mentors who have been where you’re going and learn from them.

• Invest in relationships, not just product development.

10. Stay human while building something big.

Running a startup is chaos. It’s easy to lose yourself in the grind. Founders who last are the ones who prioritize mental health, boundaries, and balance.

Putting this into action:

• Set clear work boundaries. Burnout helps no one.

• Make time for non-work activities that recharge you.

• Remember that success is a marathon, not a sprint.

Wrapping Up

The best founders aren’t the ones with the best ideas. They’re the ones who test, adapt, and build strong networks. Success comes from relentless execution, real customer insights, and the willingness to pivot when necessary.

Onward & upward,
Drew

P.s. If we haven’t met yet, hello! I’m Drew Burdick, Founder and Managing Partner at StealthX. We work with brands to design & build great customer experiences that win. I share ideas weekly through this newsletter & over on the Building Great Experiences podcast. Have a question? Feel free to contact us, I’d love to hear from you.