The #1 Reason Startups Fail: Ignoring Functional Jobs to Be Done

We spent the morning advising an exciting Agentic AI startup on their product strategy.

It’s a fantastic company idea, their prototype is amazing, their startup pitch is terrific and they are getting early investor traction.

But at this point, their product strategy is really only a broad vision statement, not an actionable refinement of customer need that they can actually use. In particular, they need something that guides them in:

• Navigating tradeoffs and prioritizing tough product and feature decisions;

• Allocating their scarce development resources and calendarizing their plans;

• Developing product positioning and marketing messages that actually resonate with potential early buyers.

Without this focus, they are at risk of being “all things to all people”, having an unclear value proposition for a smushy customer target, little understanding of this target’s propensity to buy, and an unfocused product roadmap. These, in turn, can lead to products nobody really needs — at least not so badly they are willing to pay for them.

And this, far more often than not, can break the company.

Our friends have the same conundrum shared by nearly all young businesses: they need to focus and place their bets.

It’s a very complex undertaking, it can be scary, and it requires a time-tested process. Fortunately, there is one — and it works. Here’s what we told these entrepreneurs (the examples have been changed to protect their IP):

Why Startups Should Focus on Functional Jobs To Be Done (JTBD) Over Broader Aspirations

When setting company goals and product strategy, startup leaders often get caught up in big-picture aspirations—such as “empowering sales teams” or “revolutionizing sales efficiency.” While these visions are inspiring, they don’t provide clear direction for product execution. Instead, focusing on a Functional Job To Be Done (JTBD) ensures your strategy is practical, customer-driven, and execution-ready.

1️⃣ Functional JTBD = Actionable & Measurable

A functional JTBD describes specific problems customers are hiring a product to solve. For example, instead of saying:

❌ “We help sales teams win more deals.”

You focus on:

✅ “We reduce the time it takes for sales engineers to prepare custom demos.”

This shift makes it clear what your product needs to do and helps teams align on tangible metrics within each job — called desired outcomes — that define customer success and specify how customers themselves will evaluate “the job done right” (e.g., reduction in demo preparation time, increase in demo-to-close conversion rates, faster onboarding for new sales engineers).

This focus allows teams to survey their audience before development even begins, in order to capture and score product opportunities, based on real understanding of the relative severity of their pain points. It also can allow startups to understand how incumbent competitors are performing in these same important metrics, uncovering performance gaps in the market.

2️⃣ Avoids “Aspirational Trap” & Keeps Focus on Real Customer Needs

Aspirational goals often lead to vague strategies and overbuilt products that don’t solve core customer problems. Instead of chasing an abstract vision, functional JTBD forces you to start with customer struggles and work backward.

For example, instead of saying:

❌ “We make sales teams more data-driven.”

You prioritize:

✅ “We automate pipeline forecasting to reduce manual spreadsheet work.”

This ensures the product solves an immediate, high-value problem, making it more likely to gain traction and retention.

3️⃣ Drives Faster Iteration & Product-Market Fit

Startups operate under high uncertainty, and the fastest way to success is through rapid iteration. Functional JTBD helps you:

✅ Test specific solutions quickly (e.g., sales proposals vs. real-time deal scoring)

✅ Measure success clearly (e.g., % reduction in manual reporting, increase in deal velocity)

✅ Pivot based on real behavior rather than assumptions or abstract aspirations

Without this focus, startups risk wasting time building features nobody needs or chasing a vision customers don’t pay for. Unfortunately, we’ve seen plenty of both examples in our respective careers.

4️⃣ Attracts the Right Paying Customers

Customers don’t buy visions—they buy solutions to concrete problems they have. A clear functional JTBD helps startups:

✔️ Define who will pay and why (e.g., mid-market SaaS companies struggling with sales forecasting)

✔️ Create clearer messaging that resonates with target users (e.g., “Cut your sales forecasting time by 50% with AI-powered insights”)

✔️ Build pricing models based on solving high-value problems (e.g., pricing tied to sales pipeline improvements)

For instance, rather than branding your app as a “next-gen sales enablement platform”, you might position it as “a one-click proposal generator for enterprise sales teams.” This level of precision helps you attract and convert the right customers.

Final Takeaway: Functional JTBD = Execution & Growth

For early-stage startups, aspirations provide motivation, but functional JTBD drives execution. By focusing on the specific job your customers need done, you create a product people actually need, iterate faster, and drive sustainable growth.

🚀 So, what’s the core job your startup is solving?