Start-ups flourish but 80% fail ‘within 5 years’

ENTREPRENEURIAL activity is expected to “flourish” across the mid-west region in the coming years, but up to 80% of start-up companies will fail within their first five years of trading, unless they have the right experience mix, it has been warned.

That opinion has been voiced by Limerick Chamber of Commerce president, Kieran MacSweeney, a former senior vice-president of US technology multinational Avocent.

“The reality is that 80% of traditional start-ups fail because they don’t have the necessary blend of technical, entrepreneurial and management skills. Typically 40% of these businesses will even fail in the first year of operations; 80% of those that survive the first five years will fail in the second five. Therefore, after 10 years, only 4% are left and 96% will have failed. This shows that the start-up model in its current typical format, driven by technicians/practitioners, is failing to a large degree,” he said.