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90% Of Businesses Fail In Their First Five Years: Why You Should Start a Business

“Over 90% of businesses fail in their first five years…” “Don’t start a business, you’ll fail!”
“The 10% got lucky…”

Ever heard any of these? I call them shutdown sentences, because they immediately shut down a part of the mind. They destroy all possibilities of alternative solutions, and prevent any further thought about the topic.

Let’s dig deeper.

Firstly, the statement is gravely rigged, it implies that all the businesses in question share identical circumstances. On the contrary, the 10% of businesses that did succeed did not get lucky. But then, what makes the difference between the 10% and the 90%? Let’s look at an example:

Case 1: Bill started a toaster oven selling business, he makes modest sales and is treating it as his full time job. Bill uses his profits to live and pay the bills. A year later, Bill’s business failed because Wal-Mart was selling better toaster ovens at a cheaper price.

Case 2: John started a flower delivery online business. John also has a full-time job providing income that he spends wisely to advertise and grow his flower delivery business. John knows his competitors and manages to offer competitive prices by working ridiculous hours in addition to his job. A year later, John’s previous competitors closed down, he now has employees doing a majority of the work, and he can live off of the income he earns from his business. He then decides to make his company public, gathers investors and uses their funds to branch out to physical location. John now dominates the flower delivery service market.

Conclusion: John knew what he was doing, he understood his market and his current competitors. He then worked his heart out to outgrow his competitors. Bill, however, did not understand his market and the omnipresence of his competitors. John had a job in addition to his business, Bill did not. Bill treated his business as a job, in other words a chore, and John treated it as his passion.

John succeeded, Bill failed.

So what’s the point? If you prepare correctly, you improve your odds of success. That statement may be written as “90% of business owner’s didn’t try enough” or “90% of business owners gave up”.

Of course, that’s an oversimplification, and that leads me to my second and final point. After failing with their first attempt at a business, how many people do you think tried again? Referring to the previous example, if Bill tries again with a new idea, studies his market and makes the appropriate preparations, nothing’s stopping him. Similarly, maybe John failed once, twice or nine times before finally hitting the nail on the head with his flower delivery business.

As Mark Cuban, incredibly successful entrepreneur once said: “It doesn’t matter how many times you fail, you only have to be right once.”

So, dear reader, don’t let failure stop you, think of it instead as a step closer to success.

If you’re interested in starting your journey to financial independence and success, I highly recommend picking up Rich Dad Poor Dad, here’s an affiliate link to purchase it on Amazon, you would be supporting me too!
Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!

If you’d want to learn more about achieving goals and fighting a lack of motivation, I highly recommend Grant Cardone’s The 10X rule, please feel free to purchase it using this Amazon affiliate link in order to support me as well!
The 10X Rule: The Only Difference Between Success and Failure

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