Study on Success Factors of Startup with Limited Capital : Focused on On-line Fashion Store

Abstract

This study uses the performance and success factors considered by existing studies on startups to explore the success factors behind the performance results of online fashion stores launched with limited capital. To assess the degree of success of these startups, the following business performance factors were used as indices: average monthly profit, online store survival period, and period of returns on initial investment. Further, the following factors were considered to influence the performance of these startups: business products, founder’s capability, founding capital, and prior preparation in terms of training or consultation. Nine founders who established online startups with limited capital and projected good performance in terms of average monthly profit, online store survival period, and return on initial investment were selected to examine whether the general success factors for startups led to successful performance results; further, a case study of these businesses was conducted. The results of the study were as follows: 1) all the selected founders were sufficiently competent in terms of experience but only partly competent in terms of entrepreneurship and business skills; 2) most of the selected founders gave positive assessments to marketability, but only some of them gave positive assessments to profitability or differentiation of the business product; 3) all the selected founders had a founding capital adequacy ratio of more than 50 percent and sufficient degrees of financing strategies in place; and 4) there was almost no training or consultation provided for startups as prior preparation, except for the collection of information related to startups.

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