What are the most effective strategies for turning around a failing startup?

The first step to implementing a turn around is to know whether there is anything to turn around in the first place. It's candid self-reflection on the state of affairs. Some things are too far gone. Some things aren't worth saving. Some things are better off with a fresh start. Do you want the baggage of the current company? In many cases this is a very emotional decision and it's important to consider speaking to someone objective on the matter who you can trust, like an advisor or attorney. They will tell you what you need to hear - not what you want to hear. Once you've determined that saving the company is worthwhile, you need to reflect on how you got there. Often there will be one glaring reason for this - start there.

Often many businesses are doing things very right in many ways and are getting pinned down by one serious issue. This could be commercial, but it could equally be operational or technical. Think about where the roadblocks are - if the issue is revenue - start with the commercial and product teams. If the issue is ballooning costs, start with operations. Ultimately, the company needs to understand why it can't keep its head above water. A pivot is a big decision but if every sale you make comes with too many headwinds, it could be a sign that there's a bad fit with what you're trying to sell into market.

Agree it's necessary to cut costs to minimise cash burn quickly but to raise funds successfully a clear strategy is required - pivot or persevere decision refereed to above should have already taken place.

Cutting costs can only go so far. You begin to impede growth prospects and you may only be prolonging the inevitable. Start with cutting costs you identify as superfluous - and be in no doubt that this can include people. There can be unnecessary layers of management or developers who aren't contributing to the core, revenue generating product. This is a delicate process but as long as the lights are on, you should really think about minimising the 'nice to haves'.

If churn is high, you've got to look at why. Customers are your best source of feedback and validation. They're also your most honest source of information. Your customers won't be afraid to shop around or tell you you're too expensive. Make sure you're regularly setting up QBR's with them and listening to their needs. Importantly, show them you've implemented their changes when they trickle through; that'll pay in dividends. But don't take their world as gospel. Remember, customers also have their own priorities and agendas, and they could be in a turnaround themselves. A cancellation could be for a multitude of reasons behind the scenes that you have no control over. Asking pertinent questions at cancellation that can help.

I had this conversation with a client recently. Be sure you are offering a product or service that people want to buy. They have to not only like it they have to be willing to pay for it. If you have to sell aggressively you probably do not have a good offer. Don't fall in love with a bad idea. Be willing to adjust, pivot or abandon it if necessary.

When a business is struggling, the main focus should be on increasing revenue before diving into cost-cutting measures. Cutting costs is important, but the primary reason for the business's failure is often an issue with the cash flow. To address this, the key strategy is to find innovative ways to enhance lifetime customer value and customer retention. This could be through diversifying products or services, expanding or exploring new target customer groups, improving marketing strategies, or strengthening customer relationships. Once the revenue flow strengthens, it's appropriate to consider optimizing expenses and operational efficiency for the long-term success.