For entrepreneurs, “failure” feels like a curse word. We wince and often retreat in fear of it. When people think about startups, the word failure isn’t too far back in their minds. I myself often cite the age-old statistic that peppers headlines, confidently claiming 90% of startups are doomed to die.
And I’m not alone. In an op-ed for Fortune, business journalist Erin Griffith admits, “I carelessly repeat a statistic that I’ve heard dozens of times in private conversations and on public stages: ‘Nine out of 10 startups fail.’” The problem, she says, is that the data actually proves otherwise. In a study conducted by Cambridge Associates, researchers found that the real failure rate hasn’t gone above 60% since 2001.
According to Griffith, the 90% failure myth serves to soothe the bruised egos of those startup founders who failed. To mitigate its paralyzing effects, failure is fantasized as the norm. “But startup failure isn’t a natural law like gravity,” says Griffith. (more…)