Building sustainability: Increase your chances of success by understanding why businesses fail

According to the US Small Business Administration Advocacy, about two-thirds of businesses with employees survive at least two years, but only 50% make it to the five-year mark and just one third celebrate their 10-year anniversary.

A quick internet search will derive a number of expert opinions but broadly they fit into the following categories:

  • Failure of the Leadership/Management team
  • No real market differentiation
  • Failure of the sales team
  • Unprofitable Business Model
  • Poor Financial Management and Planning
  • Expanding Too Quickly

Most of these reasons are addressable with good external input; leaders can evolve, and teams can change; the business model can iterate to identify a profitable way forward and the market proposition can get better as learnings from mistakes are taken on board.

The attached toolkit dives deeper into these common reasons why businesses fail and uses these learnings to offer advice on how you can manage your business differently and achieve sustainable success.

Building sustainability: Increase your chances of success by understanding why businesses fail

Our Toolkits are PDF, Word or Excel files, which may not format correctly on some mobile devices. Please open on desktop or with Google Docs/Sheets.

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Steven Dunne

Article by Steven Dunne, Senior Partner

Steven has over 15 years of private equity experience gained both within private equity firms and as a senior executive of private equity backed companies. He joined Frog as CFO and Partner in charge of Portfolio in 2015. He represents Frog on the boards of Mediatonic, Scoota and Edited.