I'll tell you a story. I started a business, worked about 50 hours/week on average for about a year, and made $12,000. That's 2500 hours at a rate of... $4.80 per hour[1]. When I could've made $15/hour right away at a boring office manager job doing estimates, phone support, and yelling at the men when they leave their tools a mess. Or could've gotten an entry level job at BigCorp and been making... I don't know, whatever people who work hard and get promoted fast make within a couple years.
So when I start a new company that pays me more the next year, my first business "closed" - that means it's not going. You could say it "failed", but really, I learned the lessons, made a tiny bit of coin, and then promoted myself into the next business. I know lots of entrepreneurs who leapfrog themselves the same way - and similarly, lots of small companies get bought and integrated or stripmined by a bigger company. This is actually a hard part of being a businessman - that's your baby, y'know? - but if you're ready to move on, it's certainly not a failure.
Paul Graham sold Viaweb. Viaweb company is no longer a going concern. It didn't fail by any stretch of imagination, but will be included as a "failure" in these silly "most small businesses don't exist (fail) within five years" statistics.
[1] Numbers might be off a bit, my memory's kind of hazy. I remember calculating at one point that I was making something like $2.20 an hour, maybe after six months or so. $5,500 net split with my partner after six months? I'm smiling now, but it's kind of ugly to remember those days...
I think it's reasonable to consider a business that does not make the investment + minimum wage a failure. IMO, it's more a question of how large the failure was. If you made 2/3 what you could have been making at a normal job and then quit it's a failure but not a major one. If you end up with 30k of debt then that's a major failure.
So when I start a new company that pays me more the next year, my first business "closed" - that means it's not going. You could say it "failed", but really, I learned the lessons, made a tiny bit of coin, and then promoted myself into the next business. I know lots of entrepreneurs who leapfrog themselves the same way - and similarly, lots of small companies get bought and integrated or stripmined by a bigger company. This is actually a hard part of being a businessman - that's your baby, y'know? - but if you're ready to move on, it's certainly not a failure.
Paul Graham sold Viaweb. Viaweb company is no longer a going concern. It didn't fail by any stretch of imagination, but will be included as a "failure" in these silly "most small businesses don't exist (fail) within five years" statistics.
[1] Numbers might be off a bit, my memory's kind of hazy. I remember calculating at one point that I was making something like $2.20 an hour, maybe after six months or so. $5,500 net split with my partner after six months? I'm smiling now, but it's kind of ugly to remember those days...