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Why Only <7% of Businesses Ever Exit?

America Has a Small Business Crisis No One Wants to Talk About

Every morning, more than 35 million entrepreneurs wake up, flip on the lights, unlock the door, and grind their way through another day.
They are not chasing venture capital.
They are not trying to become a unicorn.
They are building real businesses with real customers and real stakes.

These are the people who keep the American economy alive.

And yet the failure rate is brutal.

Half of all small businesses shut down within five years.
Only a third make it ten years.
Less than seven percent ever experience an exit.

This is not a startup problem.
This is a national problem.
And almost no one is delivering the solution.

On Episode 16 of Bootstrapping to Billions, I walked through the data and the reasons why so many small businesses collapse. More importantly, I explained the framework I use to build companies that do not just survive but become ownable assets.

The Market Is Huge and the Risk Is Personal

Here are the numbers that reveal the real picture.

When founders say they are “all in,” they usually mean it.
The financial future of the owner and the health of the business often become the same thing.

And as artificial intelligence reshapes the job market at record speed, more Americans are starting businesses than ever before.

We are not only entering the Age of AI.
We are entering the Age of Bootstrapping.

But there is a right way to bootstrap and a wrong way.
One produces freedom.
The other produces failure.

The Survival Funnel No One Likes to See

This is what the journey looks like for 100 new businesses.

    A [Year 0: 100 Start] --> B[Year 5: 50 Fail]

    B --> C[Year 10: 33 Survive]

    C --> D[Lifetime: Fewer Than 7 Exit]

Half are gone by year five.
Only a third survive ten years.
Fewer than seven ever exit.

The longer the business survives, the more personal wealth becomes trapped inside it. Many founders end their careers with most of their net worth locked in a business that no buyer wants.

This is the heartbreaking pattern.
People believe they own a business.
In reality, they own a job with a logo.

The Five Reasons Small Businesses Fail and the Fixes

I combined SBA data, CB Insights research, and more than a decade of founder experience. The causes are always the same. The solutions are straightforward.

Cashflow destroys more businesses than competition or bad ideas ever will.
Founders usually do not fail because they built the wrong thing.
They fail because they ran out of fuel.

What It Means to Build an Ownable Business

An ownable business is defined by one idea.
Someone else should be able to buy it and run it.

If someone else can buy it, then it can be valued.
If someone else can run it, then you do not have to.
That is where freedom begins.

Here are the five exits that show the path.

Most people think the win is Exit 5.
It is not.
The real win is Exit 4.
The business runs. You own the equity. You have your time back.

The HoldCo Mindset: Simple Beats Sexy

A HoldCo is a company that owns companies.
Berkshire Hathaway is the largest example.
A small entrepreneur can operate the same playbook.

A HoldCo mindset focuses on:

• repeatable systems

• simple scorecards

• weekly rhythms

• profit waterfalls

• standardized hiring and operations

The work is not glamorous.
It is incredibly effective.

Bootstrapping is not about scarcity.
It is about building something that lasts.

A New Series: The Exited Founders Interviews

We are launching a limited series on Bootstrapping to Billions called Exited Founders.

This will not feature tech celebrities.
This will highlight the silent seven percent.
These are founders who built a valuable business and sold it.

They will talk openly about:

• what they would do differently

• mistakes that almost killed their deal

• the single decision that multiplied their valuation

• how they turned a job into an asset

It will be raw and honest.
Exactly what founders need.

The One Billion Dollar Mission

At Bootstrapper.ai we track a single goal.
We want to see one billion dollars in bootstrapped equity created by our community.

The mission is simple.
Shift the seven percent exit rate toward one hundred percent ownable mastery.

Founders should not fail because no one taught them how to build a business that can survive, grow, and exit.

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