Disclaimer: There’s nothing political about this post. If you extract such, that’s on you.
Read any blog, pick up any paper, watch any cable news show, listen to any speech and there’s a good chance you’ll hear the phrase “start a small business.” And that makes sense: entrepreneurship is sexy. Bootstraps are emotionally stirring. Small businesses are the backbone of the economy. The road to recovery is lined by them.
And that’s because it’s simple to start a small business and make it successful, right? Anybody can do it! All you need is a storefront or a computer or a “love of [dogs, people, logistics, code, cupcakes, clothes, money, etc.].”
Wrong. Simply wrong.
Starting a small business is not easy. In fact, it’s probably one of the hardest things someone can ever decide to undertake. It’s the epitome of risk. There is no seamless transition from a steady paycheck job to entrepreneurship. Becoming an entrepreneur means that you are now responsible for everything, including but not limited to entity formation, accounting, marketing, finance, sales, technology, business development, retail space (if necessary), vehicles, hiring, equipment, travel, budgets, negotiating, staff management, benefits, retirement, payroll, more sales, bills, taxes, filings, vendors, customers, more business development… Ev. Ree. Thin. Guh.
And the most daunting part? Paying yourself is often the last priority. Your business can survive if you don’t pay yourself. It can’t survive if you don’t, say, pay the rent on your retail location or your accountant to tell you how much your business has to pay in taxes. There is a significant likelihood that you personally won’t see a dime out of the business for months. Maybe years. Are the millions we’re encouraging to “follow that dream and start a small business” prepared for that?
This isn’t intended to be negative, but rather realistic. It’s naive to think that everyone is cut out to be an entrepreneur, small business owner, whatever you want to call it. Small business failure rates vary depending on the source, but 60 percent within the first two years isn’t extreme. THAT’S A LOT. And that’s reality.
But we shouldn’t tell them no. We shouldn’t tell people not to give it a shot. Entrepreneurship can be one of the most life-changing journeys you can take, for better and for worse. It should not be discouraged. What we need to do is stop being so casual in our collective encouragement that anyone can do it; that it’s easy and the surefire solution to a crappy job. We also need to stop using “so that someone can start a small business” as a rationale for anything. Because if starting a small business is one single thing, it’s really, really hard.
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