Assessment of factors determining success or failure of startup business: a case of SMEs in Kinondoni

This study aimed at discussing and examining why startups businesses fail and few succeed and grow. The main objective of the study specifically to provide understanding to how new entrepreneurs who start up the business to consider several factors affecting business success or failure hence reducing the risk of failure and increase the chances of success in starting a business in SME’s. The study had three specific objectives which focused on the influence on the availability of working capital flows, the relevance of business planning and the influence of professional employees on the growth of the starts up businesses. The study was conducted in one of the district in Dar es Salaam which is Kinondoni in which 50 SMEs were involved in the study. Both primary and secondary data were collected from different sources in which questionnaire was the main source of collecting data. The study employed regression analysis in making the analysis. Findings reveal that the startup business failure, success for growth is manifested in several factors. These factors include the availability of adequate working capital flows, availability of business planning and availability of professional staff. The findings also revealed that for any start up business to grow, it requires a business plan which is well organized; it is a vital tool for the business for owners or representatives of the owners who run the business to manage the business more effectively. The study recommended, special incentives (financial and regulatory) are needed to support SME’s growth and encourage businesses to become formal in the long run. SME’s support groups including the government should focus in enhancing awareness of the SME’s policies, financial assistance, training and entrepreneurial orientation.