This paper focuses on failed small and medium enterprises (SMEs) to certain extent in Nigeria. The objective was to identify SME failure factors and trajectories. A number of studies have focused on firm success, but few recent studies have focused on firm failure (Thompson 2001: 619). However, as we know, some firms succeed and others fail. Chances of financial success are substantially greater than the chances of loss (Dennis & Fernald 2001). However, they are not nearly as favorable as new firm owners seem to believe (Cooper et al. 1988). It seems reasonable to assume that much could be learned from failed firms. A high proportion of new ventures are closed down during their first year of life, and many SMEs are closed down every year, indicating that these firms were not able to maintain the alignment with their environment, or had never even achieved it. For instance, in Finland in 2002, half (50.2%) of the firms that closed down had survived less than five years (Statistics Finland 2004). However, managers are as much responsible for avoiding failure as for achieving success (Argenti 1976: 182). As a matter of fact, it has been argued that the most important and most challenging business goal is long-term survival (e.g. Simon 1996: 12). Moreover, survival is, at least in the long term, a prerequisite for success in other terms, such as market share or profitability. To date, however, studies of firm longevity pay more attention on large companies. 2nd Inter-RENT Online Publication 94 However, SMEs are often the only feasible engines of development, especially in peripheral regions. They generate societal growth in terms of new jobs and revenues; they create innovations, and form flexible production networks. In fact, relatively speaking, the number of jobs created by expanding small firms is larger than the number of jobs created by new firms during their first year of operation or by large firms (Wiklund 1998: 1).