Fact Or Fiction: 9 in 10 New Business Will Close In The First Year?

Closed.   Photo by Jasoon.

Greg Balanko-Dickson:

There is a myth from the 1990’s that stated 9 out of 10 businesses close in their first year. The US Small Business Administration still gets calls every year from people looking for the unknown source of the 9 out of 10 sound bite. The myth persists partly due to a widely held belief that business closure is always considered a negative event.

Dun & Bradstreet (D & B) data from the same period shows a much different picture:

  • 76 percent of new businesses were open after two years.
  • 47 percent after four years.
  • 38 percent after six years.

Photo by Jasoon.

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