Top 5 Technology Challenges Faced By Startups

1st Feb 2020
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Starting a new company is both exciting and challenging. For those who have no experience in running a business, starting and running a new company can be overwhelming. Startups can face challenges in almost all business functions such as marketing, sales, human resources, accounting, customer service, technology, etc.


Technology is one area that affects almost every other business function. Technology encompasses software, hardware, information technology (IT), websites, mobile apps, telecommunication, etc. By using the right technology, businesses can increase their efficiency and boost their productivity.

The common technology challenges faced by startups include:  

Choosing the Right Set of Software Tools

Having the right set of software tools increases the efficiency of business functions such as marketing, HR, customer service, etc. By using these tools, a startup can easily and effectively manage business functions. But choosing software tools that are best for a particular company is not an easy job. Startups should look into the market and buy the best software tools that meet their requirements.


Various software tools that can help a startup in increasing its efficiency and boosting its productivity include project management software, accounting software, customer relationship management (CRM) system, stock management tool, logistics software, order processing tool, communication tool, software, marketing software, etc.


Instead of buying a ready-made software tool, startups can go for custom software. A software development company can provide a business a bespoke software tool that has been developed to meet its unique requirements.  

Staying Up-To-Date With Technology

It is a huge challenge for startups to stay up-to-date with technology as technology keeps on changing. So, it is important for startups to deploy those technology solutions that serve their both short-term and long-term requirements, and are upgradeable and scalable. This will help them when their business will grow and they will need latest technology stack and better technology solutions. This will also save them from reinvesting in technology solutions.    

Building Digital Solutions

To thrive in the market today, businesses need digital solutions such as websites, mobile apps, e-commerce, etc. Selling products only through a physical store fails to generate a good amount of revenue. So for businesses, it has become important to have an e-commerce store besides a physical store. 

A website is the face of a business on the internet. A startup needs a website that fully serves the purpose of creating it, is visually appealing, fast, secure, and provides a great user experience. As there are over 5 billion unique mobile users worldwide, offering services and products through mobile apps has also become important for businesses.         


Developing these solutions in-house is time-taking and expensive. A startup already has limited resources in terms of money, time and manpower. It is a great challenge for a startup to build an in-house web or mobile app development team. Just building a website, e-commerce store or a mobile app is not the end, as these digital products require maintenance on a continuous basis.


Startups can easily overcome the challenge of building digital solutions by taking services of a mobile app and web development company. Professional mobile app and web developers can easily develop robust and scalable websites, web apps and mobile apps that provide an awesome user experience.

Deciding on Hardware

When it comes to making decisions about the hardware, startups are often confused. They find it difficult to decide whether they should buy or lease hardware. They have difficulty in choosing the manufacturer and the configuration of hardware.


They are often unable to decide whether they should give their employees desktops or laptops. The solution to this problem depends on the budget and working conditions. If a startup has a good budget and also wants its employees to work from home, then clearly laptops are the best option. If working from office is only required, then desktops will effectively serve the purpose. If in case, some employees do a lot of field work, then for them, tablets with high battery life will serve the purpose.  


Another question that disturbs startups is the type of printer they should use – 3D printer or a normal one. The answer strictly depends on the requirements of a business. If a 3D printer is to be used occasionally, then one option is to share it with another company, for example, if in case the other company is on the same floor. Sharing will reduce costs incurred by both companies. 


When it comes to servers, then most startups find it difficult to run and maintain servers on their premises. Cloud hosting provides a cost-effective way to do so to startups.

Ensuring Cybersecurity

Almost all companies today face cybersecurity risks as they rely on the internet. For businesses providing online services and products, ensuring cybersecurity poses a major challenge. If the security of a tech startup serving the B2B market gets compromised, other companies relying on it might not be able to function smoothly. For example, if the systems of a mobile app and web development services provider are infected by any type of malware, then the apps or websites developed by it for its clients might also be infected and not function properly. The malware may also steal the data of the development services provider and its clients.     


For a startup, it is not easy to deal with cybersecurity issues. Resolving a security issue can put a lot of strain on its already limited resources. A security breach can bring the business of a startup to a halt and put its reputation at stake. A startup should take stringent security measures to prevent the occurrence of any sort of security breach.


To mitigate cybersecurity risks, startups should install a robust firewall and antivirus software. It should train its employees on how to securely handle sensitive data such as credit card data of customers, business data of clients, etc. Employees should access company data through a secure network. There should be a strict IT security policy that clearly dictates how employees are required to manage their computers, how frequently the passwords are to be changed, how employees should identify and handle spam emails, etc.   


It is not unusual for startups to face different technology challenges. By understanding the common technology challenges and ways to overcome them, startups will be able to better embrace the technologies that will help them climb the ladder of success.

Want to make your startup journey smooth? YS Education brings a comprehensive Funding Course, where you also get a chance to pitch your business plan to top investors. Click here to know more.

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