Startup Now, Because Fewer Are Doing It
A recent article describes a Census bureau report that shows the US business startup rate has fallen to a record low level. How should you use this information? Should you sit on the startup sidelines because so many other potential entrepreneurs are doing so? The answer is, “NO, you should start your company NOW!” Here’s why.
The data for the recent report comes from 2010 (it takes the government quite a while to release data), when the percentage of all companies that are new fell to 7.87%. But consider also that the peak startup rate of 13.02% occurred in 1987, long before the famous internet boom, and you see that this country has been undergoing a long slide in the rate of creating startup companies. I claim that this information is good news for people who have the urge to startup.
First, consider this follow-up article that points out failure rates for startups are also down. The assumed reason: Startups today are better managed. If this is true, I say one reason is because there is so much more assistance available to startups, and it’s easily accessible on the Internet. Just do a search for help in starting a company and see how many hits you get. By the way, Inc. Magazine does a great job of giving you ideas for companies to start; look here and here for two such articles.
Second, speaking of Inc. Magazine, consider the title of one of their recent online articles: “Start A Company, It’s Your Only Hope Of Living The Life You Want.” One key concept from this article is this: “The ‘security’ society is over.” It may actually be more risky to depend on getting and keeping a job than it is to start up your own job.
Finally, consider that there is an enormous need for new companies and that fact eventually has to drive the national, state and local governments to make it easier to start companies. Small businesses provide a large percentage of new jobs, which means that society needs you, and professional politicians (often referred to euphemistically as “policy makers”) are taking notice. Although the political class are not the smartest kids on the block, even they know that when their laws and regulations can be linked to bad jobs reports, they have to change their ways to keep their own cushy jobs. By the way, that link is undeniably true: The Federal Reserve Bank of Cleveland did an empirical study that showed that uncertainty in government drives the startup rate down. Government policy makers are increasingly being urged to address the problem of a shrinking startup base.
The concluding message is simple: Start you own company now. Your country needs you to do it, and you need you to do it for yourself!
Please read, use, and comment on what you find here, but remember this: Random advice, even the advice you find at Argent Place, cannot supplant the personal legal advice you receive from your own legal counsel. If you agree that Personal Legal Counsel from someone with experience at running a business could help you create more wealth, please contact Argent Place Advisors to have an exploratory conversation.