City Research Online

Abstract

How many businesses survive more than a 100years? Of the businessesthat do survive,how many remain financially robust? If the lifespan of a company on the Standard and Poor’s (S&P)500 list is an indication of longevity,then evidence shows that ithas shrunk from 33 years in 1964 to 24 years by 2016.By 2027, itis forecast to shrink to just 12 years.1Put differently, at the current survival rate, more than 75%of thecompanies currently quoted on the S&P 500 woulddisappearin the next decade.Family-ownedbusinesses tend to mirror these survival patterns. Alargeproportion of family-ownedbusinesses struggle to survive beyond the second orthird generation.According to the Family Business Institute, only 30% of these organizations last into a second generation. Only 12% remain viable into a third anda miniscule3% continueinto the fourth generation or beyond.What have these 3% businesses and the familybusiness owners done differently that is likely to have contributed to their resilience? What can be learnt about the group that have livedbeyond 100?

Publication Type:	Article
Additional Information:	© 2018 – Indian School of Business (ISB)
Subjects:	H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management H Social Sciences > HF Commerce
Departments:	Bayes Business School > Management

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