Simple Profit and Loss Statement

Do the majority of small businesses fail because of lack of capital?

According to Bloomberg, 8 out of 10 entrepreneurs who start businesses fail within the first 18 months. That’s a whopping 80%!

But why? What can you learn from all of those failing companies that you can apply to your own business so you can improve your chances of success?

Let me be the first to say that one of the main reasons businesses fail is because they run out of cash.  So having access to business credit lines and funding sources is an essential component to long lasting success but it’s not the only thing that’s important.

Another key ingredient is knowing your numbers.

In a recent article that I wrote for the SBA titled the ‘5 Pillars of Small Business Success’, I went over the importance of having a profitable business model. Without nailing down your numbers your business can end up on the chopping block.  Bill Gates co- founder of Microsoft says “Know your numbers; it is a fundamental precept of business.”
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