The 90% figure gets cited constantly. It’s roughly accurate over a 10-year window, though what counts as “failure” varies by study. Some research counts any company that doesn’t return capital to investors, which includes acqui-hires and soft landings. True shutdowns where the business simply dies are still disturbingly common.

Running out of money is the most common immediate cause. Analysis of startup post-mortems consistently shows cash problems at or near the top. But running out of money is usually a symptom rather than the root cause.

The deeper reasons tend to fall into a few categories.

No market need is the biggest one. The product doesn’t solve a problem people will actually pay for. Founders build something they think is brilliant without validating that customers want it. This shows up in roughly a third of failed startup post-mortems.

Spending too fast kills many others. Raising a Series A doesn’t mean you have money to burn. Many startups increase spending immediately after funding, assuming the next round will come through. When it takes longer than expected or doesn’t happen at all, they’re suddenly in trouble with no time to adjust.

Pricing and business model issues doom others. The unit economics never work. Customer acquisition costs more than customers ever pay. Gross margins are too thin or even negative. These problems get hidden by growth metrics until eventually the math becomes impossible to ignore.

Team problems and competition account for more failures. Founders split up. Key hires don’t work out. A well-funded competitor appears. The market moves faster or slower than expected.

Here’s what most founders miss. Many of these problems are visible early if you’re watching the right numbers. Companies that fail often do so in financial darkness. They don’t know their real burn rate. They don’t understand their unit economics. They have no handle on their actual runway. By the time they realize something is wrong, they’ve run out of room to recover.

The survivors treat financial management as a core function rather than an afterthought. They know their burn rate. They understand what it costs to acquire a customer. They can show investors clean books and credible projections. They have someone watching the numbers who will flag problems early.

Working with a startup bookkeeper from the early stages isn’t about compliance or preparing for audits down the road. It’s about having financial clarity to make good decisions before small problems turn into fatal ones. The 90% failure rate includes a lot of companies that could have survived if the founders had seen what was coming in time to do something about it.