Startup Cemetery

A big resource for entrepreneurs and startup owners, in which we have collected and analyzed why +100 big companies have failed. Learn from mistakes, and avoid being part of the 90% of businesses that fail.

Design Inc.

Marketplace for high-quality design work

General Information
Category
Design
Country
United States
Started
In 2016
Business Failure
Business Outcome
Shut Down
Closed
By 2017
Cause of Failure
Bad Business Model
Founders & Employees
Number of Founders
Two
Name of Founders
Bjoern Zinssmeister, Marc Hemeon
Number of Employees
Between 1 And 10
Funding
Number of Funding Rounds
1
Total Funding Amount
$2.3M
Number of Investors
No Data
Description

Design Inc. was a startup that linked clients to talented designers. Clients would post on the site the projects they needed to get done. Design Inc. allowed designers to autonomously send proposals for the projects they would like to work on while charging a small fee for it. The platform helped designers all over the world to find their dream projects and companies were happy to be able to choose from a talented pool of designers.

Cause of Failure

Design Inc. reached market saturation after some time. The number of projects and companies were not increasing and the startup could not make enough revenue to cover operation costs. This put the company in a low cash situation and they founder took the decision to close it down.

Design Inc. CEO identified a number of reasons that he believed contributed to the failure of his company. He stated that he should have been more focused on the essentials of business, which is getting more leads and profit. He also mentioned that a startup founder should also test his assumptions and keep on optimizing the product in every little way. Team members should also be encouraged to experiment without fear.

Another broader issue that is not exclusively linked to Design Inc. may be with the business model itself since the design field is considered a top-end market where job posts are scarce by nature. Too many designers compete for only a limited number of design jobs, thus causing the market to saturate too soon. Another reason why the company might have not witnessed a growth in its network could have been due to the fact that although designers are introduced to the clients by Design Inc. platform, in the end, they might decide to continue their business transactions independently from the marketplace.

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