The first 5 years of a business are always the life and death journey of a business. And in those first 5 years, there are at least 5 ways for a business to disintegrate: from disillusionment with the product, exhaustion with operations, cracks in cooperation, deadlock with strategy to losing direction because of the founder himself. The business does not die immediately, but begins to disintegrate from within – silently, slowly and undetectably. And the scariest thing: most people involved do not know they are disintegrating, until it is too late.
According to the Small Business Administration (SBA):
- 20% of businesses “die” in the first year,
- 45% collapse before the fifth year.
When you look at this number from the outside, it’s just data.
But if you’ve ever owned a small business – it’s the names of the people you started it with.
It’s the late-night phone calls, the half-finished plans, the contracts never signed.Là những tan rã không cần thông báo.
1. The one who goes it alone – can’t go it alone
Many people start out alone – with passion, determination, and a desire to “do something on their own”.
But then, they have to do everything from products, sales, revenue, paperwork… to washing glasses and taking care of the page.
No one shares the pressure. No one gives feedback. No one helps “close a deal in the hot noon”.
Gradually, the founder no longer has the strength. No longer has time to think long-term. And loses motivation.
Lesson: You can start a business alone, but you can’t go it alone. Build an ecosystem around you – not a lot, just the right people..
2. Cooperate to go together, but break down because of disagreement
Many teams start with the belief that “we will be stronger together”. But then:
- Some people want to sell quickly, others want to do it slowly for quality.
- Some people commit themselves, others “half time, half heart”.
- Some people shoulder the finances, others only contribute ideas.
- And then the simmering conflict turns into doubt, then into a breakup.
Lesson: Collaboration requires clarity from the start: about roles, commitments, and decision-making.
Being friends does not mean being a good partner
3. Lack of money is one reason, but lack of purpose is the real problem
Many businesses don’t die because they run out of money – they die because they run out of direction.
Running a project that never works, a product that doesn’t grow, marketing that never sells, and no one is sober enough to ask: “Should we change direction?”
Without a clear purpose, everything becomes exhausting.
Lesson: Each quarter, each year, there needs to be a specific goal for the team to work towards. No need to be too ambitious – just know “why you keep going”
4. Energy drain, not from working too much – but from losing faith
Being a small business means living under constant pressure.
Today the order does not meet the target.
Tomorrow the customer cancels the order, the product is defective.
Next week the staff quits without notice.
And if you have no one to share with, no one to “pass on the fire”, then you die in silence.
Lesson: Build a community of founders or advisors – not to solve the problem, but to save the spirit.
5. Exhausted before selling because… searching for the perfect formula
Many young businesses spend the first 1-2 years just developing the product.
Always worrying about making it perfect.
Always editing, upgrading, optimizing… forgetting that the product survives because of buyers, not because it is the most beautiful.
By the time the product is ready – the person making it has run out of capital, energy, and confidence.
Lesson: Go to market early, listen to real feedback, and sell to survive. Don’t let “product idealism” kill a cash-strapped business.
Conclusion: Businesses don’t fail for any one reason – it’s because of too many little things at once
There’s no “right” reason why a <5 year old business fails.
It’s a combination of:
- a little loneliness,
- a little conflict,
- a little misdirection,
- a little procrastination,
- and finally the day when no one wants to try anymore.
If you are in year 1, 3 or approaching year 5 – don’t wait for a miracle.
Start having honest conversations with your partner.
Check your compass.
Share your frustration before it becomes a reason to leave.
Businesses don’t die – people are the first to fall.
