Start Up & Beyond: Why Profitability Matters

Being a for profit business means your focus is on growing a business that is profitable. Seems like a “duh” statement, doesn’t it? Then why isn’t this understood from the very beginning? Depending on the source, the average number of years a start-up business becomes profitable is anywhere from 2 to 5 years. And yet according to the U.S. Bureau of Labor Statistics, an alarming 20% of start-ups fail within 2 years and another 45% of businesses don’t make it past 5 years. Only 25% of businesses make it to 15 years or more.  

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​A more profitable business is a more bankable business. Just ask your local banker. A start up that is in a growth mode and can’t show a profit is hard pressed to get bank funding, and while it may be able to get angel or venture funding, then the pressure to be profitable becomes ever present.  It seems evident that profitability should be taken more seriously from the very beginning. So why isn’t it? 

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