By Miguel Vanegas Torres

Whether you’re 20, 40, or 50, starting a business is hard. The odds of success are low. You have to be a radical optimist to try. You have to take the plunge without knowing how any of it will turn out.

But that doesn’t mean going in blind. You need some idea of what could go wrong.

Over 27 years of building businesses and helping dozens of entrepreneurs along the way, I’ve seen firsthand what causes ventures to fail. Here are the four main reasons businesses end up closing.

1. Sales

Without sales, you have nothing. If your product doesn’t solve a real problem and the sales aren’t coming in, sooner or later you’ll have to stop. Your idea might be brilliant and revolutionary, but if nobody is willing to pay for it, it won’t work.

Sales are the lifeblood of a business. They bring in cash, make growth possible, and affect everyone with a stake in the company.

A few years ago, Fredy Vega told me in a conversation, “Ninety-nine percent of a company’s problems can be solved by selling more.” I don’t entirely agree. Sales keep a business running, but culture, finances, and processes matter a great deal, too.

And anyone who wants to start a business needs to know how to sell. That’s essential.

Think about it, and you’ll realize you’re always selling: when you’re looking for partners, pitching your product, raising capital, applying for a loan, or even trying to find suppliers who believe in you.

So get out there and sell!

2. Cash Flow and Profitability

You might be selling like there’s no tomorrow, but if you don’t pay attention to liquidity and profitability, your business has no future. Eventually, you won’t have the money to pay suppliers, employees, lenders, or taxes.

“Businesses fail when they run out of cash.” In my view, that’s the most important sentence in business finance.

No money in the bank, no business. It’s that simple.

The point isn’t to chase sales at any cost. It’s to sell while keeping a close eye on the numbers. On one side is liquidity: you need to make sure there is always money in the account, and enough of it to cover your obligations.

On the other side is profitability: your selling prices need to cover your costs and fixed overhead, with money left over. If that math doesn’t work, sooner or later the business stops working, too. Money isn’t unlimited.

3. Mental and Physical Health

Working 20 hours a day, never stopping, cortisol through the roof, constant stress... Eventually, the entrepreneur simply can’t keep going. And that’s where it ends.

Everything may be going well in the business, but if the person leading it burns out, there’s only so much you can do.

Personally, I’ve never been at risk of having to close the business because of cash flow problems. I’m very careful with the numbers. But more than once, we’ve come close to throwing in the towel and saying, “We’re done.” Both Sany and I have been through serious mental and physical health challenges that made us wonder whether we should close the business and put our lives first.

Fortunately, we’ve made it through those periods, and we’re still here. But we’re clear about one thing: we and our relationship will always matter more than a business venture.

4. Conflict Among Business Partners

Many businesses close because the partners split up, because they never had the difficult conversations at the outset, or because their paths diverge.

Be very careful about whom you go into business with. It’s almost as important as choosing whom to marry. Don’t take it lightly.

Put vesting agreements and partnership agreements in place. Get legal advice. Go on spiritual retreats. Do whatever it takes to make everything completely transparent from the beginning and align everyone’s interests. Starting a business alone is extremely difficult, and I don’t recommend it. But be warned: starting one with the wrong partners is even worse.