By Wandia Chiuri (Social Media Enterprise Architect, Wandia.info)
Entrepreneurs start new businesses and take on the risk and rewards of being an owner. This is the ultimate career in capitalism – putting your idea to work in a competitive economy. Some new ventures generate enormous wealth for the entrepreneur, and many opportunities for the economy.
Small businesses have generated 64% of net new jobs over the past 15 years. They represent 99.7% of all employer firms, hire 40% of high tech workers, and produce 13 times more patents per employee than large patenting firms, according to the Small Business Association.
Small businesses — companies with fewer than 500 employees — account for more than half of all private-sector employment.
According to President Obama, small businesseses are key to getting the economy back on track. “We genuinely believe that small business is the backbone of America. It’s going to be the key for us to be able to put a lot of folks back to work,” Obama said.
Startups account for only about 3% of U.S. employment, but they are responsible for nearly 20% of the gross number of jobs created year to year, according to Ron Ron Jarmin, assistant director for research and methodology at the U.S. Census Bureau and coauthor of that research paper, “Who Creates Jobs? Small vs. Large Vs. Young”.
The main challenge for each candidate in the US elections is to provide specifics on how government will tap into that economic power by providing entrepreneurs across the country with access to business education, financial capital and business support services to help small businesses grow and create jobs.
Still, the responsibility to create these opportunities does not fall just on government. The challenge is a clarion call to the people. Even when challenges seem insummountable, as entrepreneurs we recognize that our own resolution to succeed is more important than any other.
This economy has made entrepreneurs out of all of us. You now need the same skills to make a job, or get a job. You need to be hard-working, smart, creative, willing to take risks and good with people. You need to have heart, motivation and drive.
Still the job of an entrepreneur is not for everyone. It requires tremendous flexibility, agility and a wide range of skills. On the entrepreneurship track, life often lacks stability and structure. There is no job description or specified working hours. Your ability to take time off can be highly limited and you may become stressed as you manage cash flow (or lack of it) on the one hand and expansion on the other.
For small business entrepreneurs, there are many barriers to growth. Small business owners frequently face challenges finding growth capital available, business support services, and expert advice. 3 out of 5 new businesses in the U.S. fail within 18 months of getting started. Some entrepreneurs succeed in only creating a job for themselves, where they work far more than they should for the return they get, because they are doing the wrong work.
Often, in addition to capital, small business owners need practical information and opportunities to gain business insight or skills they can apply immediately, such as accounting, marketing, human resources management, etc. Opportunities to interact with and learn from entrepreneurs who have successfully built companies can probably best addresses barriers to growth. Networking opportunities and peer to peer support can also make a world of difference.
For women entrepreneurs, this is particularly critical. Most lucrative deals happen these type of conversations, and yet, while women own nearly a third of all businesses (29%), they have less than 1% access to capital, according to the second annual The State of Women-Owned Businesses report from American Express OPEN.
One of the best things about pursuing a career as an entrepreneur is the wide-open possibilities. Emerging economies and industries around the world make wealth creation possible. New technology has created spaces that are ripe for disruption, be it the internet and information technology, personal services, media, engineering or local businesses like dry cleaning, electronics repair, restaurants, etc.
Possibilities are endless, particularly for women because the digital marketplace is redefining customer relationships into areas that showcase our skills. Remote capabilities are shaping the way people work, and how companies build and exploit internal and external assets.
In this shifting marketplace, how do you create an effective business model?
Be savvy. As an entrepreneur, it’s critical to understand what is and is not realistic. The web is chock-full of come-ons promising to make you rich. Avoid promotions that promise some magic secret to wealth. Look for inefficiencies in markets. Places where a better idea, a little ingenuity or some aggressive marketing could really make a difference.
Think about problems that people would pay to have a solution to. It helps to really know your product and market well. It also helps to know finance. What do consumers want? What differentiates you from the competition? How do you market this product?
Think about trends. As the world continues to digitize and grow in complexity, virtually every enterprise will need to have a great digital business model, one that creates value by engaging customers digitally.
Can you achieve competitive advantage by providing unique digital content, an exceptional customer experience, or superior personalized platforms that exploit the social and mobile technology and data we have access to now?
Take time to plan upfront. While a formal business plan is not always essential, it is normally a great help in thinking through the case for a new business. You’ll be investing more in it than anyone else, so treat yourself like a smart, skeptical investor who needs to be convinced that the math adds up for the business you propose starting.
The possibilities in entrepreneurship are endless. The rewards can be high. And the risks are undoubtedly high too. But, if you have drive, creativity and the desire to be your own boss, the world needs you!
Editor’s note: Got a question for our guest blogger? Leave a message in the comments below.
About the guest blogger: Wandia Chiuri is a digital, mobile and social media aficionado. She has designed a career that combines an avid interest in global emerging markets with enthusiasm for adventure, fascination with science and passion for people. With a track record of leadership, she has worked in the sales divisions of two Fortune 500 corporations, Medtronic Inc. and Eli Lilly and Company and serves on the boards of two non-profit organizations. Follow her on Twitter at @Wandia_Info.