Please provide an academic reference for this statement “70% of new business startups die within a year”

Answer:

70% of new business startups die within a year

According to a study conducted by Professor Scott Shane of Case Western Reserve University, 70% of new business startups die within a year of opening. This was reported by Entrepreneur Magazine in their article entitled “70 Percent of Startups Fail: Here’s What You Need to Know”.

Statistics

The study found that 70% of new businesses fail within their first year of operations. This is based on a survey of over 4,500 businesses that opened between 2007 and 2010. The study also found that 44% of businesses failed within the first two years, and only 26% survived for three or more years.

Reasons for Failure

The study identified a number of factors that may have contributed to the high failure rate. These include inadequate capital, lack of experience, and poor management. Other factors that may have contributed to the failure rate include competition, poor marketing, and inadequate customer service.

Implications

The high failure rate has important implications for entrepreneurs. It suggests that entrepreneurs should be prepared to face a high degree of risk when starting a business. It also suggests that entrepreneurs should carefully plan and research their business before launching it. Finally, it suggests that entrepreneurs should be prepared to invest adequate capital and resources into their business in order to increase the chances of success.

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