So imagine this. . . you have this amazing idea for a product, and you are so excited to get on and make it. You think about all the different aspects of the product, and how you can make it, and start investing time and money pursuing this. All seems to be going well. . . you come out the other side with a great looking product which you are sure everyone will love, because you did all the market research and testing beforehand. . . right? Wait a minute. . . you didn't ask your potential users whether they wanted/needed your product? Nooooo. . . .
Number 1 reason startups fail?
Making a product no one wants.
This should be very obvious. If no one wants what you're offering, then you really don't have a business. But entrepreneurs are optimistic, and often will build things thinking they can convince people they need/want it. This is why actually talking to your potential users (and not just your friends!) will give you a good idea about whether your idea is a good one!
Other top reasons, according to an article in Fortune, include: running out of money, not having the right team, competition, pricing/cost issues, and poor marketing. It is important to address these issues early on in a venture, in order to ensure your startup will have the best chance at success.
Take a look at the related resources for examples of how to test your ideas and ensure what you are developing is what people want!