Over 80% of all high-tech companies fail. However, the reasons are not obvious to most managers or observers.
At the Early Stage Investment Forum in Seattle, 250 accredited investors and venture capitalists voted Ansyr Technology as “the region’s most promising technology startup.”
This accolade was based on both market and company advantages including: a thriving new ecosystem called mobile computing, partnerships with both Microsoft and Adobe, and plenty of money provided by local investors.
Many of the actual reasons high-tech companies fail are not captured in statistical surveys. The traditional causes of failure were not present at Ansyr Technology and the company was well prepared for most of them.
Despite these significant advantages, Ansyr Technology failed because management neglected the most important element of long-term success: staying aligned with the motivational characteristics of customers as they evolve.
One example of customer misalignment at Ansyr was the mis-match between the skillset of the management team and the requirements of early customers. When early adopters are evaluating a new technology, they want to hear about and discuss the vision of what is possible from the company representative. This is called visionary selling.
At Ansyr, the CEO had never worked in a high-tech startup before, so he was unwilling to engage in the selling process. And the VP of sales only had experience selling in mature industries, so he lacked the required skillset called visionary selling.
Please visit the Customer Alignment Infographic on this website to see how customer characteristics change across the adoption lifecycle, which requires a change in company skillsets to be successful.