They had to persevere in pursuit of their goals to attain them. What Causes Small Business Failure? The Top 12 Reasons For many small business owners, being in charge of their own life is the prime motivator: a fervently guarded sense of independence, and money is seen as a beneficial by-product.Report on the Commission or Enquiry on Small Firms, Bolton Report, vol. Many first-time small business owners fear not having a large enough audience to market their product or service to. The US Bureau of Labor Statistics indicated that 66 percent of new establishments survive for two years, and that number drops to 44 percent two years later.Anita Campbell, Business Failure Rates Is Highest in First Two Years, Small Business Trends, July 7, 2005, accessed October 7, 2011, smallbiztrends.com/2005/07/business-failure-rates-highest-in.html. It lacked visionary leadership. First Republic is the second-largest bank by assets to fail in U.S. history. The second issue associated with small business failure is a consideration of the time horizon. However, these failures often help entrepreneurs improve the outcomes for their next business, as they have now learned valuable lessons that can be applied to new projects. Opinions expressed by Forbes Contributors are their own. Williams didnt want to go head to head with iTunes, as this could potentially destroy his company, so he found a way to go in a different direction and establish a new way of sharing status updates and other data. $500 Billion in Aid to Small Businesses: How Much Did It Help? The firm can experience bankruptcy. Ive failed over and over and over again in my life. According to the U.S. Census Bureau, just under 5 million new businesses were launched between January 2021 and November 2021an increase of 55% compared to the same period in 2019. You dont know where you are going, so you end up wasting a lot of time, money, and energy trying to get on the right path. Quirky was a platform that allowed inventors to submit their ideas to a panel of Quirky experts who would then manufacture the product at a low price and sell it to different markets. The Rise and Fall of Quirky: The Startup That Bet Big on the Genius of Regular Folks., Jeanine Poggi. Unfortunately, many of the advantages of partnerships can also be disadvantages, and statistics show that up to 70% of business partnerships ultimately fail. If you want your business to become profitable, keep your eye on the bottom line.