ENTREPRENEURIAL FAILURE AND BUSINESS RECOVERY IN PAKISTAN: HOW SMALL BUSINESS OWNERS REBUILD AFTER FINANCIAL SETBACKS

Abstract

Entrepreneurial failure can create learning opportunities, but recovery from financial setbacks may also depend on business owners’ ability to manage financial difficulties. This study examines the relationships between learning from entrepreneurial failure, financial resilience, and business recovery among small-business owners in Hyderabad, Sindh, Pakistan. The study used a quantitative, cross-sectional survey design and drew on questionnaire data from 173 business owners who had experienced significant financial setbacks. The study analyzed data using descriptive statistics, reliability analysis, Pearson’s correlation, and multiple linear regression in SPSS. The results indicate that learning from entrepreneurial failure and financial resilience were both positively associated with business recovery. Learning from failure demonstrated the stronger association , while financial resilience also contributed significantly . Together, the predictors explained 17.2% of the variance in business recovery. The findings highlight the relevance of learning and financial resilience in understanding how entrepreneurs respond to financial adversity. The study contributes context-specific evidence on recovery within existing businesses, while its cross-sectional design and purposive sample limit causal interpretation and generalizability.