Top 7 Biggest Business Collapses in History
1. Enron (2001)
CEO at the time: Jeffrey Skilling
Enron was once a darling of Wall Street, celebrated for its innovation in the energy sector and its explosive stock growth. But behind the curtain, it was a house of cards. Under CEO Jeffrey Skilling and Chairman Ken Lay, the company used complex accounting loopholes and special purpose entities to hide billions in debt. Once the deception was uncovered, investor confidence collapsed, and the stock went from $90 to under $1 in weeks. Enron filed for bankruptcy in December 2001, wiping out thousands of jobs, pensions, and billions in shareholder value. The scandal ushered in sweeping reforms including the Sarbanes-Oxley Act and became the textbook example of corporate fraud.
2. Lehman Brothers (2008)
CEO at the time: Richard Fuld
Founded in 1850, Lehman Brothers was one of the most respected investment banks in the world. But risky bets on mortgage-backed securities during the U.S. housing bubble — and an inability to sell off toxic assets — left the firm dangerously overleveraged. CEO Richard Fuld failed to secure a bailout or buyer as the 2008 financial crisis spiraled. When Lehman filed for bankruptcy on September 15, 2008, it was the largest bankruptcy in U.S. history. The collapse triggered a domino effect that deepened the global financial crisis and led to massive government intervention in the economy.
3. Blockbuster (2010)
CEO at the time of decline: Jim Keyes
At its peak, Blockbuster was a titan in home entertainment, with over 9,000 stores worldwide. But the company failed to adapt to the digital age. While Netflix and Redbox revolutionized how people accessed movies, Blockbuster stuck to its brick-and-mortar model. CEO Jim Keyes famously dismissed Netflix as a niche service. By the time Blockbuster attempted to pivot to streaming, it was too late. Saddled with debt and unable to compete, Blockbuster filed for bankruptcy in 2010. Ironically, Netflix offered to sell itself to Blockbuster for $50 million in 2000 — an offer that was rejected.
4. Toys "R" Us (2017)
CEO at the time: David Brandon
Once the go-to toy retailer for generations, Toys "R" Us struggled with mounting debt, changing shopping habits, and growing competition from Amazon and Walmart. Acquired in a leveraged buyout in 2005, the company was saddled with $5 billion in debt. Despite efforts by CEO David Brandon to restructure and revitalize the brand, the company couldn’t recover. It filed for bankruptcy in 2017 and closed its U.S. stores in 2018. While the brand has since attempted small-scale comebacks, its collapse remains a warning about debt and digital disruption.
5. WeWork (Failed IPO in 2019, implosion followed)
CEO at the time: Adam Neumann
WeWork was once valued at nearly $47 billion and hailed as a tech-style disruptor of commercial real estate. But behind the buzz was reckless spending, a flawed business model, and a charismatic yet controversial CEO, Adam Neumann. The company’s IPO filing in 2019 exposed massive losses, self-dealing, and questionable governance. Investors recoiled, the IPO was canceled, and Neumann was ousted. SoftBank eventually bailed out the company, but its valuation plummeted. Though it hasn’t technically gone bankrupt, WeWork's implosion is one of the most dramatic collapses in startup history and a masterclass in hype over substance.
6. Theranos (Dissolved in 2018)
CEO at the time: Elizabeth Holmes
Theranos promised a medical revolution — hundreds of tests from a single drop of blood. Led by charismatic founder and CEO Elizabeth Holmes, the company raised over $700 million and was valued at $9 billion. But it was all a fraud. Investigative reporting and whistleblower accounts revealed that Theranos’ technology didn’t work. The company dissolved in 2018, and Holmes was later convicted of fraud. The story of Theranos became a symbol of Silicon Valley’s “fake it till you make it” culture taken to a dangerous extreme.
Related: Elizabeth Holmes vs. Sam Bankman-Fried: A Tale of Two CEO Scandals
Related: The Biggest Financial Scams in History That Shook the World
7. FTX (Collapsed in 2022)
CEO at the time: Sam Bankman-Fried
FTX was a leading cryptocurrency exchange, seen as a trustworthy bridge between traditional finance and the volatile world of crypto. Its CEO, Sam Bankman-Fried (SBF), was hailed as a crypto wunderkind. But in November 2022, a liquidity crisis revealed a multibillion-dollar hole in the company’s balance sheet. It turned out FTX had misused customer funds through its sister hedge fund, Alameda Research. FTX filed for bankruptcy and SBF was arrested and convicted of fraud. The fallout sent shockwaves across the crypto industry and triggered calls for tighter regulation.
