This chapter discusses the survival of entrepreneurial ventures. This is a topic of key economic and social importance.

At the outset, it is helpful to make some observations about some important definitional issues which are sometimes overlooked in both scholarly and popular discourse. First, the continuation of an individual in entrepreneurship is not necessarily equivalent to the survival of their business. For instance, serial entrepreneurs ‘survive’ in entrepreneurship even when their successive businesses do not. This can partly explain why individual exit rates from entrepreneurship tend to be lower than venture closure rates (Ronstadt, 1986).

Second, entrepreneurs close businesses for a variety of reasons. Sometimes they do so in order to start new, more promising, ventures. In other cases, closure is a reluctant choice prompted by persistent financial under-performance. It is helpful to bear in mind that the determinants of venture prospects sometimes differ from the factors affecting entrepreneurs' willingness to continue in business.

Third, survival is sometimes treated as a measure of entrepreneurial performance. Unfortunately, this interpretation is problematic for several reasons. Some survivors scrape by on a pittance, while others deliberately exit a small niche profitably once more promising options appear. Indeed, some entrepreneurs deliberately plan to exit within a predetermined time to harvest their investment. As will be discussed further below, calling these closures ‘failures’ seems harsh, if not actually misguided.