There are always a whole range of different opinions on such matters, often completely contradictory. So here's mine.
A company goes out of business because they don't get enough money in to cover the money going out. It is the job of management to keep on top of this, ensuring they have sufficient reserves to cover fluctuations in revenue, unexpected costs, bad decisions, etc. It is like this anywhere, aviation or otherwise.
The old Birmingham Executive was a small-scale operator which took on big-airline aspirations. They sold out to Maersk, a major Danish business with lots of financial reserves, and they turned their operation into a BA franchise from Birmingham, which always adds more to revenue. Despite all this, the operation never made Maersk any money and they decided to get rid of it.
The management decided that, while they had lost money as a franchise operating in the name of a worldwide airline, they could somehow turn it all around by going off on their own under an unknown name. They also decided that while they had lost money using a secondhand fleet handed down by Maersk (doubtless at a good price) they could now make money by going out and buying brand-new kit in the shape of the CRJ-700, not really a start-ups aircraft.
Then they decided to get into routes rapidly rather than steadily and easily.
Finding Birmingham couldn't deliver them profits they cast around for other places like Edinburgh, which just added marketing and operating overhead.
Then they ran out of the cash they didn't have too much of in the first place. And that is that.