A Business Success Versus Failure Prediction Model for Entrepreneurs with 0-10 Employees
Abstract
This empirical survey study presents a success versus failure (SIF)prediction model (S/F = f [advisors, planning, education, minority business ownership, staffing, parents owned a business, record keeping and financial control, capital, industry experience, economic timing}). Using stepwise discriminant analysis, the predictor variables explained 54% of the variance in SIF. The model accurately predicted 75.00% of the surveyed 96 matched pairs firms as being successful or failed. The model will predict a group of businesses as successful or failed more accurately than random classification over 99% of the time (model p=. 0006).
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