This post is based on the research that I made for a YouTube video that you can find here. The numbers have been updated with September 2020 numbers on all startups.MethodologyI’ve researched all kinds of different sources and compiled a list of the Top 10 biggest failures when looking at how much was invested in them. I’ve done extensive research, but I may have missed something, so would be great if you find something that I’ve missed and isn’t on the list.Personal CommentI made this list so that we can learn from them and avoid their mistakes. Always remember though that behind any Startup there are real people, real people that have invested blood sweat and tears into these startups. And Yes they most likely invested blood sweat and tears even if the startup ended up as a failure. Building a startup is rough, going down with a Startup is even rougher, so well done for trying!#10 Terralliance $358 million investedTerralliance was in the business of looking for oil but in a very different way. They were using low and slow flying airplanes to find pockets of oil. A very creative approach, but I guess it never really worked.Year defunct: 2008Location: California, USAWhy they failed: No Product Market fit#9 Amp’d Mobile $407 million investedAmp’d Mobile was launched in 2005 as a new mobile phone provider that targeted a younger demographic and featured downloadable and streaming video as well as streamed live events which was all new at the time.Year defunct: 2007Location: California, USAWhy they failed: Mismanagement/Bad Decisions#8 Pay by Touch $427 million investedPay By Touch was a payment provider that offered biometric authentication at the point of sale which was supposed to be a low-cost alternative to other payment options.Year defunct: 2007Location: California, USAWhy they failed: Mismanagement/Bad Decisions#7 Webvan $580 million investedWebvan was an online grocery store where customers could get products delivered to their homes within a 30-minute window of their choosing.Year defunct: 2001Location: California, USAWhy they failed: No Product Market fit#6 Abound Solar $700 million investedAbound Solar was manufacturing thin-film for solar panels.There is not much information about this company online.Year defunct: 2012Location: Colorado, USAWhy they failed: No Product Market fit#5 Theranos $726 million investedTheranos was making a blood-testing device that could test you for any disease you can imagine, from only a small drop of blood.Year defunct: 2018Location: California, USAWhy they failed: No Product Market fit#4 Better Place $755 million investedBetter Place was building a global network of battery-charging and battery-switching services for electric cars. The key was this battery switching that meant you could have a fully charged battery in minutes instead of waiting for a long charge.Year defunct: 2013Location: California, USAWhy they failed: No Product Market fit#3 Jawbone $1,045 million investedJawbone developed and produced wearable technology such as wristbands, wireless Bluetooth headsets, and related technology.Year defunct: 2017Location: California, USAWhy they failed: No Product Market fit#2 GO.COM $1,162 million investedGo.com was not a traditional startup that had investments from investors. Go.com was a Startup inside Disney. I added Go.com to the list as Disney actually made it public how much was invested and lost in Go.com and that amount qualified them for this list! Disney wanted to build a portal that had all the content that Disney provided. Disney also acquired the search engine Infoseek and Infoseek became a part of Go.comYear defunct: 2001Location: California, USAWhy they failed: No Product Market fit#1 Solyndra $1,853 million investedSolyndra was a manufacturer of thin-film solar cells.The secret sauce of the product was that they didn’t use polysilicon. Not using polysilicon was an advantage as it was costly and there was even a shortage of polysilicon in 2008.Year defunct: 2011Location: California, USAWhy they failed: No Product Market fitWhy do most Startups fail?Looking at the list it becomes pretty clear that there are two reasons why these really big failures happen. Either they never find a product market fit or there is some mismanagement or bad decisions. In some cases there is both. If you ask, What is the number one reason startups fail? It is pretty clear from the biggest startup failures of all time that the number one reason for failure is that they never get a Product Market fit.Take Theranos, there clearly was no product market fit, but on top of that some really bad mismanagement. The same probably goes for Terralliance too.Where Startups Fail (and Win)Another interesting observation for this group is that they are ALL from the US, not one single Startup from anywhere else in the world made this list.Actually, the geography is even more crazy. Not only are they all from the US, but 9 out of 10 are also from California. All 9 are either in the San Francisco Bay Area or Los Angeles, incredible to see 9 out of 10 are from only 2 cities.Sure there are some really big losses here in California and you are tempted to think that they make some really bad investments in California. However, California looks bad because this is where most investments are made and there is a willingness to take really big bets here. When you take really big bets you will win some and lose some. We have to remember that the number of big winners here is even more staggering - companies like Facebook, Google, Apple, Cisco, Intel, Oracle, eBay, Salesforce - you know I could keep going.This post is based on my best research, if you find something missing, please post a comment.Also, if you have any stories about these Startups it would be very interesting to hear them. Most of these companies have some really colorful personalities and leadership behind them. see hubwealthy.com/wealthy
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