If your startup has to go the way of the dinosaurs, wouldn't you want to know as soon as possible? Startup Smart gives eleven early warning signs that your startup might be failing. Here are two examples:
Increases in fixed costs without an increase in revenues
Fixed costs have a direct impact on your profitability.
If you increase your fixed costs these need to be linked to revenue and profit expectations.
You also need sufficient capital or funding to cover these costs if increases are needed to facilitate growth.
Funding your business with debt rather than equity finance
If your business is funded on debt it’s easy to strip profits out of your business with interest costs.
There’s nothing wrong with debt funding. It just needs to be managed.
Watch your funding mix and review debt regularly.
