Startup Failure Rates — The REAL Numbers
By Scott Shane, April 28, 2008
Startup Trends
Source: http://smallbiztrends.com/2008/04/startup-failure-rates.html
Below is Figure 6.2 (p.99) from my bookIllusions of Entrepreneurship: The Costly Myths that Entrepreneurs, Investors, and Policy Makers Live By.
The data come from a special tabulation by the Bureau of the Census produced for the Office of Advocacy of the U.S. Small Business Administration.
While these data look at the 1992 cohort of new single-establishment businesses, the failure rate percentages are almost identical for all the cohorts that researchers have looked at. So, these are pretty much the one through ten year survival rates of new firms.These are the averages. There are considerable differences across industry sectors in business failure rates
Proportion of New Businesses Founded in 1992 Still Alive By Year
Business survival rate: 45% survival rate after 5 years and 29% after 10 years.
The Illusions of Entrepreneurship: The Costly Myths That Entrepreneurs, Investors, and Policy Makers Live By
Author: Scott A. Shane
Source:http://www.sba.gov/advocacy/849/12162
Data on Small Businesses
Historical research
Business Dynamics Statistics
BDS contains employer firm data by firm age. See the background paper Business Formation and Dynamics by Business Age: Results from the New Business Dynamics Statistics by John Haltiwanger, Ron Jarmin and Javier Miranda for information on the data program.
This section should be viewed as an introduction to the data program. Please visit the U.S. Census Bureau’s Business Dynamics Statistics program for background about the data and their database list for more detailed data on firm size, state and major industry (includes text files).
Firms and establishments by firm age, 1977-2009 (Microsoft Excel file)
Data file link:
http://www.sba.gov/sites/default/files/files/bds_estab.xls
Dynamic data, births, deaths, growth and decline
State totals, 2005-2007 (PDF file)
http://www.sba.gov/sites/default/files/files/dyn_st.pdf(file attached)
Another source: http://www.bls.gov/bdm/bdmage.htm
