// STARTUP COMPARISON
Westernacher Spain vs Carillion
Westernacher Spain failed in 2018 due to Unit Economics. Carillion failed in 2018 due to Unit Economics. Both failed for the same reason — Unit Economics.
| METRIC | 🔥 Westernacher Spain | 🔥 Carillion |
|---|---|---|
| Sector | SaaS | SaaS |
| Country | Spain | UK |
| Founded | 2000 | 1999 |
| Died | 2018 | 2018 |
| Raised | Private | Public company |
| Peak | €20M revenue | £5.2B revenue · 43,000 employees |
| Primary Cause | Unit Economics | Unit Economics |
// WHY EACH FAILED
🔥 Westernacher Spain
Unit Economics
Westernacher Spain, an SAP consulting subsidiary, overextended during Spain's economic recovery of 2014-2018, signing more contracts than it could staff and deliver profitably. The backlog grew faster than hiring capacity, quality deteriorated, margins collapsed, and clients churned. A significant restructuring in 2018 included layoffs and write-offs of non-performing contracts.
// LESSON
In professional services, the backlog is a liability as much as an asset. More projects than you can staff means quality collapses, clients churn, and the reputation that took years to build dissolves in months.
In professional services, the backlog is a liability as much as an asset. More projects than you can staff means quality collapses, clients churn, and the reputation that took years to build dissolves in months.
🔥 Carillion
Unit Economics
Carillion was the UK's second-largest construction and services company with £5.2B revenue and thousands of government contracts. It carried £1.5B in pension deficits and £900M in debt. Three profit warnings in 2017 exposed structural insolvency. It entered compulsory liquidation in January 2018 — the largest ever UK trading liquidation — leaving 43,000 employees and thousands of subcontractors unpaid.
// LESSON
Revenue is not solvency. A company with £5.2B in revenue and £2.4B in combined pension and debt obligations is not viable — it is a zombie awaiting a trigger event.
Revenue is not solvency. A company with £5.2B in revenue and £2.4B in combined pension and debt obligations is not viable — it is a zombie awaiting a trigger event.
// EXPLORE FURTHER