Entrepreneurship: Is it the Best Time to Launch Your Business?

Entrepreneurship: Is it the Best Time to Launch Your Business?

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The United States has long been the natural home of the entrepreneur but recent reports suggest that Americans are less likely to start a company now than in the past four decades. So what has led to this worrying decline in home grown entrepreneurship? And does this low point offer an ideal opportunity to launch your start-up?

Fear of Failure

The main reason for this lack of entrepreneurial spirit is down to one thing - fear of failure. Unsurprisingly, much of this recent trepidation is a legacy effect from the Stock Market crash of 2008. The truth is that confidence hasn't really recovered since then. Although U.S based entrepreneurial business launches have been in steady decline for several decades, the catalyst of the last major financial crisis has proven pivotal.

The U.S census data speaks for itself: in 1977 there were just under 600,000 start-up businesses launched in that year. Between then, and prior to the Stock Market meltdown in 2008, the number of entrepreneurial launches fluctuated between 500,000-600,000. However, since the crash the number of launches has hovered at a much lower rate, between 400,000-450,000 per annum. 

This generational loss of enterprise is having a detrimental effect on the launch of start-ups which is still being felt today, despite a steadily improving economy. The net effect of this is that the more traditional firms, which by their very nature tend to be less dynamic, now employ an increasing proportion of the workforce. 

In fact, between 1993-2013, the share of companies who had been in business for over 16 years that were actually driving the economy increased 12 percent and the share of the workforce employed by such firms increased from 62 percent to 73 percent. The result is that that employees are less likely to leave what they deem to be a safe job, they are less prepared to seek out new employment and are more unlikely to take the risk of launching their own venture. 

Women & Millennials Offer Entrepreneurial Hope

So is it all doom and gloom? Well, it's unlikely that we will ever see a resurgence in small retail launches as major chain expansion and increasingly complex operating legislation hasn't left much room for the little guys unless they can offer something truly unique. That said, opportunities do exist in the technology sector and there are some early signs from the Kauffman Index of Startup Activity that there has been a fairly significant increase in start-up launches -- not at the levels prior to the economic collapse but definitely a noticeable spike. 


And there is also the hope that the Millennial generation are waiting in the wings to take their entrepreneurial bow. Mark Zandi, who is the Chief Economist of Moody's Analytics, says that most entrepreneurs tend to start their businesses when they reach their 30's and Millennials are just getting into this stage of their lives. Zandi claims that now is the time:

"We're far enough away from the dark, gravitational pull of the recession and crisis. People should be more willing to take risks"

Or maybe the female entrepreneurs will lead the next wave of business success. My recent article on the topic looked into how women business leaders are slowly beginning to forge an entrepreneurial path of their own. Statistics from the University of New Hampshire 'Centre For Venture' annual reports show that prior to 2014 the number of women seeking angel investment was fairly static at around 15% of the total. There was a spike in 2014 with that figure rising to around 19% and the current estimate is that female-owned ventures accounted for circa 23% of the entrepreneurs that were seeking angel capital. 

The Next Zuckerberg, Bezos, Musk or Winfrey

Being the next Mark Zuckerberg, Jeff Bezos, Elon Musk or Oprah Winfrey takes some guts. The problem at the moment appears to be that people are more willing to play it safe rather than have the courage of their convictions. No guts, no glory. What I am fearful of is that many brilliant ideas are simply being left on the proverbial table because outstanding entrepreneurs don't feel confident enough to back themselves. Carpe diem I say. The time feels right to believe in yourself and your venture, so get in there before someone else does. 

So what do you think? Am I right? Is now the time to start a business? Or is it still too risky in the current climate? What does the government need to do to help entrepreneurs start and maintain their fledgling businesses? Or is it down to the individual to forge their own path? 

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  • Brenden Jones

    Our generation is afraid of failure that's why we prefer to take it easy

  • Kyle Wesley

    There are a lot of startups, it's barely impossible to stand out and compete.........

  • Noel Farrell

    Who wouldn't want to become the next Marc Zuckerberg? The guy is a genius, Facebook has changed our life. He succeeded because he made the right decisions and was surrounded by smart people. It's easy to start a business but it's very difficult to scale it.

  • David Bennett

    You are absolutely right, it's always the same companies who are making headlines. It's time for a change.

  • Liam Smith

    We are brainwashed by universities, they want us to be slaves of the modern economy

  • Pat Anderson

    We should absolutely take more risks. Those people who made it far away had a lot failures but were able to stand up and withstand any storm.

  • Junior Kelly

    interesting post

  • Chris Harfoot

    I didn't realise how horrible my university life was until I read stuff like this, we never got lucky..........

  • Michael Salt

    What’s wrong with us these days?! Isn’t that every school boys dream?? what is this world coming to

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Steve Blakeman

Management Guru

Steve is the #1 LinkedIn Global Top Voice 2017 - Management & Workplace. He is the Managing Director - Global Accounts for OMD based in London / Paris leading Groupe Renault. Prior to this role, he was CEO for OMD in Asia for 4 years based in Singapore. At OMD, he increased billings by +60% to over US$ 5bn and won 1000+ industry awards including agency network wins at the Cannes Lions (2013) and Festival of Media Asia (2013). He was named by LinkedIn as a 'Top 10 Writer' for 3 consecutive years (15/16/17). His first book 'How to be a Top 10 Writer on LinkedIn' is a Best Seller on Amazon and his 2nd book is due out in 2018. Steve holds a Bachelor in Psychology from Liverpool University. 

   

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