Data Room Dev Internet of Things Why does agile development fail in most startup companies?

Why does agile development fail in most startup companies?

Have you ever questioned why most startup companies fail to enact their agile development plan? This is a pertinent question, especially since the rise in technology-based start-ups has become more noticeable in the past decade. Unfortunately, the current statistics show a dismal failure rate among these companies. According to a report by Deloitte, 85% to 90 % of these startups close within the first 18 months after their launch. The main issue is that most startup companies lack the strategies and processes to implement agile development.

The purpose of the article is to explore the challenges faced by companies when they adopt agile development, and to offer a remedy. The article is written by Matthew Johnson, a Business Consult with more than 18 years of experience in the corporate world. He is an expert at implementing agile strategies in the workplace, and has successfully worked with numerous startups to help them develop robust software solutions.

In this article you will learn why most startup companies struggle to get to grips with agile development. We’ll discuss the potential impediments, and then recommend strategies and approaches that are ideal for technical startups that wish to enhance their operations through agile development. The proposal offers a three-step plan to maximise the value from agile implementation and avoid failure.

Definitions: Agile development is a methodology for software development through iterative cycles. It is often used in startup companies in order to quickly produce working software and address customer needs. However, it does have its limitations and can lead to failure in some cases.

Iterative Cycles – Agile development involves “sprints”, where a team works on a specific set of requirements over a period of time. At the end of the sprint, the team releases a working version of the software to be used by customers. The team then gathers feedback and moves on to the next sprint and continues working on additional features.

Changing Requirements – One of the main reasons agile development fails in startups is because of ever-changing requirements. As the product develops, customer needs change, competitors enter the marketplace, and technology advances. These dynamic elements can easily cause an agile project to fail.

Lack of Resources – Resources, such as people and equipment, can be difficult to find in a startup environment. Without the right people or tools, agile development can be difficult or impossible. Without the right resources, the team may not be able to complete the sprints in a timely manner or produce a stable version of the software.

High Risk – Finally, agile development is a high-risk endeavor. Changes to the software are made quickly and the team must be prepared to handle the consequences of the changes. If something goes wrong, it can be difficult and time-consuming to fix, causing the project timeline to go off track.

Lack of Agile Knowledge and Experience

Agile Basics

  • What Agile Methodology Is
  • How Agile Differs from Traditional Approaches

Increasing Agile Knowledge and Skills

  • Learning and Practicing Agile Techniques
  • Developing an Understanding of Agile Values

This article will address the lack of knowledge and experience with Agile, and discuss ways to increase understanding in this area. Through understanding Agile basics, its benefits, and techniques for developing knowledge and familiarity, readers will gain insight on how to stay ahead of the curve with Agile adoption.

Wrong Prioritization and Poor Planning

Causes of Wrong Prioritization

Wrong prioritization can be caused by a lack of goals & objectives, insufficient data to anticipate risks, or by failing to take into account different perspectives on the issue.

Effects of Poor Planning

Poor planning can lead to miscommunication, inefficient use of resources, or ineffective decision-making which can create a climate of mistrust amongst stakeholders. Unforeseen problems may arise, causing further delays and additional cost.

Unrealistic Expectations

This article focuses on ‘Unrealistic Expectations’ and how they can lead to disappointment and failure.

The Difficulty of Living up to Unrealistic Expecations

It can be difficult to meet the high standards set by impractical expectations. This can lead to feelings of overwhelm, stress, and inadequacy.

The Harm in Striving for the Impossible

Unreasonable expectations can lead to disappointment and hurt when reality falls short. This can result in anxiety, depression, and discouragement.


Agile development can seem like the ideal approach to software development for many startup companies. But, why is it that even with its amazing capabilities, agile can still fail in such contexts? It is essential to have an understanding of the various pitfalls that can arise, and the right strategy to counteract them.

Thinking about the difficulties that can come with agile development in the context of startup companies is an important part of the process. We invite our readers to continue to follow our blog, as we offer fresh insights into this complex and ever-evolving field. In the coming weeks and months, we will be releasing more articles and resources that can help bring clarity and success to your software development projects.

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