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Business
Key Man Risk
The risk that a business suffers greatly if one or two key people leave or become unavailable.
Investors and banks dislike high key man risk. Companies reduce it through succession planning, key-person insurance, and spreading knowledge across the team. It is especially common in founder-led businesses.
It's realising your whole company depends on one superstar who could get hit by a bus tomorrow.
Real world: A small marketing agency relies on one brilliant creative director. If that person leaves, clients might follow and revenue could drop sharply — that's key man risk.
💡 Key man risk is a hidden danger — the best businesses make themselves less dependent on any single person.