November 2011
Featured in this insight: Business & enterprise, Financial services
Survey uncovers secret to start-up survival: A survey carried out by Experian has revealed some interesting insights into what makes a start-up company successful.
The number of young entrepreneurs beginning a new business was found to have increased by 22% in the past three years, however almost half of these businesses at 45% fold within two and a half years, while a further 22% fail between two and a half and three years.
The study discovered that the survival rate for start-ups increases if there is an older director on board – 39% of businesses survive post three years when a young director aged between 16 and 25 joins forces with someone aged 26 or older. This is in stark contrast to a mere one third of businesses which survive when run by a sole young director.
In addition, survival rates jump to 48% when a young director joins forces with more than one older director. This shows that industry knowledge and experience is key to commercial success.
Managing Director of Experian’s UK SME business, Simon Streat, commented: “Such strong entrepreneurial appetite amongst young people is exciting and encouraging to see, yet... with young directors often lacking the experience, capital and contacts needed to survive those first few tricky years, our research shows that they shouldn’t underestimate the value in partnering with an older director.”
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