E- Wannabe

Posted: August 22, 2011 by John Clarkin in Innovation, People, Planning, Startup

Why would anyone not want to be an entrepreneur? Many entrepreneurs make a fortune before they reach the age of 30, government agencies are created to help them, and politicians design policies to encourage them. College students enroll in classes to learn how to become an entrepreneur, in the hope of joining others in today’s Hall of Fame for business. It seems that everyone (including this group of authors) wants to write about them, hear more about them, and celebrate them. You can find many entrepreneurial tales on our website, http://www.CincyEntre.com!  What’s not to like about being an entrepreneur?

Entrepreneurs get media attention for their successes, while press coverage of corporate executives is often limited to testimonies before Congress. Gone are the days when the CEOs of GM, GE, and Exxon represented the face of American business. Larry Page and Sergy Brin (Google), Mark Zuckerberg (Facebook), Jack Dorsey (Twitter), and Steve Jobs (Apple) have replaced Roger Smith (GM), Jack Welch (GE), and Rex Tillerson (Exxon/Mobil) as the icons of American business today. What do we know about entrepreneurs and the businesses they create?

First, we know that Americans create a large number of businesses. According to the “Kauffman Index of Entrepreneurial Activity,” Americans created approximately 565,000 businesses each month in 2010, the highest level of new venture creation despite the difficult economic environment. We know that only a small fraction of the businesses created will survive beyond their initial years of operation, and fewer yet will attain the level of success realized by Facebook or Apple. The lottery provides the possibility to become wealthy, although the probability of winning is small. Entrepreneurs are usually optimists, with a focus on success and the possibility of great fortune, but sometimes ignore the low probability of realizing the same success as Apple or Facebook or Google. Jobs, Zuckerberg, and Brin are the exceptions, not the rule.

Second, the Kauffman Index revealed that growth in new venture creation was highest among 35- to 44-year-olds, and the oldest age group in the study (55-64 years) also experienced a large increase in business-creation rates. New ideas and innovative solutions to problems are not created exclusively by young people in Harvard or Stanford’s dorms (incubators of Gates, Zuckerberg, and Brin). An increasing number of individuals with years of industry experience are discovering the challenges and rewards of business ownership. This is especially important for young, inexperienced individuals who often start businesses with passion and optimism but with a dangerous level of naivety.

Third, patience, persistence, and keen business skills are key ingredients to success. It took Twitter five years to become one of the ten most visited websites in the world from the time that the concept was created. The founders spent a great deal of time chasing money, but eventually raised more than $800 Million in 2010, convincing investors that the company founded on the concept of “a short burst of inconsequential information” that resembled the chirps of birds would someday be successful. Today, Twitter is valued at more than $4 Billion.

What starts out small can get big fast. Although they started with only a concept, Facebook’s $80 Billion market capitalization is now twice that of GM: a quick entrepreneurial journey from dorm room to boardroom. Examples of success like Apple and Facebook will inspire many people to dream, and some will embark on their own entrepreneurial journey. Entrepreneur wannabe’s wanted.

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