If attracting heaps of venture capital is supposed to vouch for a startup's potential, then how come so many of them wither and die a short time after they’re funded? Recent research by CB Insights shows that tech companies typically shutter within 20 months of their last financing rounds, with 70% dying before raising $5 million. What's more, the majority of new tech startups—55%—die before raising $1 million.
There's no one cause for that high mortality rate, but these are a few of the more common reasons tossed around during postmortems:
