Why Startups Fail: The Funding Problem Nobody Warns You About
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Why do startups fail even when they have great technology? According to investor and business development expert Pekka Hilden, one of the biggest challenges is surprisingly simple: raising the next round of funding.
In this episode, Pekka Hilden shares what investors actually look for when evaluating startups, particularly in biotech, medtech, healthtech, and life sciences. Drawing from years of international business development, strategy, company exits, and startup investing, he explains why a great idea or prototype is only the beginning.
We discuss how startups can become investment-ready, why investors prefer to see a clear path to the market, how founders should approach seed and Series A funding, and why understanding your market from the bottom up matters more than simply quoting a huge total addressable market.
Pekka also explains the importance of building the right team, preparing for a fundraising process that can take 12–18 months, using non-dilutive public funding, creating a pitch deck investors can understand in minutes, and avoiding the behaviors that can immediately turn investors away.
For researchers, university spinouts, startup founders, and innovators trying to turn technology into a real business, this conversation offers a practical look at what happens between having an invention and building a company that investors are willing to back.
What you'll learn
Why startups most commonly fail when they cannot raise additional funding
What investors look for before investing in a startup
Why a working prototype and proof of concept matter
How to understand your market using a bottom-up approach
What founders should prepare before raising a Series A round
Why fundraising can take 12–18 months and involve hundreds of investors
How public, non-dilutive funding can help early-stage startups
Why overly technical pitch decks can hurt your chances with investors
How team dynamics and complementary skills influence investment decisions
Why arrogance can be an immediate red flag in an investor meeting
Why healthtech and medtech companies need to understand reimbursement, guidelines, and cost benefit
The difference between building great technology and building a commercially viable business
Chapters
00:00 — Introduction & Pekka's career journey
02:02 — The curiosity behind an international career
02:58 — Starting international business in Japan
04:11 — From biochemistry research to business
05:31 — What is Almaral?
07:02 — Active money vs. passive money
08:55 — What startups should be ready before seeking investment
09:02 — Seed vs. pre-seed funding
11:19 — The biggest mistake startups make when analyzing markets
12:38 — Why great technology isn't enough
14:36 — How investors choose between startups
16:23 — Why the right team matters
17:07 — What Series A funding actually means
17:49 — Why Series A can take 12–18 months
18:30 — The importance of non-dilutive funding
19:10 — Startup dilution and founder ownership
20:54 — What makes a startup investment-ready?
21:55 — Why investors expect more from startups today
22:57 — How to approach investors
23:46 — How to prepare for investor meetings
24:06 — The 3-minute pitch deck
25:22 — The biggest investor red flag
26:49 — Why healthcare guidelines matter
28:09 — The importance of cost benefit
28:59 — The biggest reason startups fail
If you're building a startup, commercializing university research, raising venture capital, or trying to turn an innovation into a scalable business, this episode is for you.
Subscribe to the series for more conversations about innovation, entrepreneurship, investment, and turning ideas into real-world businesses.
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