Most Small Business Owners Feel Successful

Below is a great article from Gallup that I thought was very motivating from the GALLUP NEWS SERVICE.

source: http://www.gallup.com/poll/24103/Most-Small-Business-Owners-Feel-Successful.aspx

PRINCETON, NJ -- Today's economic environment is extremely challenging for small business owners given surging gas prices at the pump and more than two years of interest rate increases. Despite all the difficulties facing the nation's small business owners, however, most feel successful and given the choice, say they would do it over again according to the most recent Wells Fargo/Gallup Small Business Index poll. Most also say being a small business owner has made them better off financially.

Most Feel Successful

Nine in 10 small business owners say they feel successful. In fact, 47% feel extremely successful (8%) or very successful (39%). Nearly half (45%) feel somewhat successful while only 6% feel not too successful and just 1% feel not at all successful.

Eighty-seven percent of small business owners also say they are satisfied being a small business owner, with just 12% saying they are not.

Most Would Do It Again
What if small business owners were given another chance to choose between being a small business owners and doing something else? Eighty-three percent say they would do it over again and choose to be a small business owner.

Most Say They Are Financially Better Off

Three in four small business owners say they are better off financially being a small business owner than they would be working for some other company. However, just about half feel they make more money per hour as a small business owner than they would as an employee of another company.

A Passion for the Job
Being a small business owner clearly has many rewards. Even during challenging times, most small business owners would do it again. Still, this survey and previous Wells Fargo/Gallup Small Business Index surveys suggest small business owners must have a passion for what they do. They find themselves working many hours and discover working hard becomes an essential part of their work-life balance.

Survey Methods

Results for the Wells Fargo/Gallup Small Business Index poll are based on telephone interviews with 602 small business owners conducted May 22-June 9, 2006. For results based on the total sample of investors, one can say with 95% confidence that the maximum margin of sampling error is ±4 percentage points.

Most Small Business Owners Feel Successful

More on the leave of absence... SEEF3M

I've given my 3 month leave of absence a name... It's gonna be called "SEEF3M" If that doesn't make sense to you, check out this previous post.

Yesterday was the first time I had a "oh my god what have I done" moment. I had just had a couple friends over for a BBQ lunch and they had left. I suddenly felt very unproductive and unsure of whether I wanted to go through with this. I think it was because I was left alone after a good time with friends. My second biggest fear for the leave or entrepreneurship in general is that I will go stir crazy from the lack of human interaction (the biggest fear of course is losing all my money and not being able to afford a place to live).

I took today off as a vacation day (so a traditional "SEEFAD") and am now sitting in Caribou Coffee. I'm feeling much better about the decision and am looking forward to it again. Things are moving forward with the website (I just hired my first programmer!) and I'm excited to work with him.

More on the leave of absence... SEEF3M

I did it...

Last week, I did one of those things that could be life changing... I put in for a 3 month personal leave of absence. Now that doesn't sound too dramatic (nor risky, because it's a normal benefit we get and I basically come back to the same job afterwards). But I've always followed the "right" path... went to school, got an engineering degree, got a job at a Fortune 50 corporation where I have a "secure" job. Taking 3 months off is one of those things that's both scary and exciting for me.

People ask what I want to do with my 3 months off... I tell them ideally to make enough money so I don't hafta come back. But 3 months is a bit of a stretch to accomplish that (although I will buy a lottery ticket on my first day off). So I will settle for significantly advancing my textbook website and starting 2-3 low barrier to entry type businesses.

I will be using this as a safe way to test out living the lifestyle of an entrepreneur: no paycheck and no one to blame but yourself for anything. I know it could be really easy to just piss away three months, but hopefully the giant sucking sound (sorry Mr. Perot) of my monthly expenses draining my savings will motivate me to make the most of my time off.

So now, I've got a major case of senioritis... which I haven't gotten in 8 years. The leave isn't for another 4 months! I plan on blogging about my experience on this blog, and hopefully have people continue to keep me motivated and encouraged... and maybe inspire others too.

I did it...

Small business owners would do it all again

It's hard to find data on entrepreneurship - so while this data from Gallup is a bit outdated - I believe that the sentiment is the same...

Source: http://www.gallup.com/poll/9586/Would-Small-Business-Owners-All-Again.aspx

Anyone who has run a small business knows that it can be a
challenging way to make a living. Small-business owners wear many
different hats. They typically have little leeway with regard to
pricing -- they're usually price-takers on the buy-side with
no ability to leverage their suppliers, and price-givers on
the sell-side with no ability to leverage their customers. The
government generally makes the whole situation worse, forcing small
business owners to deal with enormous regulatory burdens and
paperwork that was designed with much larger companies in mind.

Given these day-to-day challenges and the relatively poor
business environment of the past few years, it probably wouldn't be
too surprising to find that many of the nation's small business
owners are discouraged and wish they had done something else with
their lives. However, just the opposite is true, according to the
new Wells Fargo/Gallup Small Business Index survey* (see "Small
Businesses Offer Hope for Job Creation" for more on this new
Index).

Small Business Owner Satisfaction

More than 8 in 10 of the nation's small business owners say they
are satisfied with being a small business owner. More than half
(56%) are very or extremely satisfied, and 30% are somewhat
satisfied. Only 13% say they are not too satisfied or not at all
satisfied.

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"440" alt="" border="0">

Small Business Owner Success

Nearly all small business owners feel that they are at least
somewhat successful at what they do. Forty-one percent feel that
they are very or extremely successful at being a small business
owner. Another 56% say they feel somewhat successful, while only 3%
say they feel they are not too successful or not at all
successful.

"http://media.gallup.com/GPTB/finanComme/20031028_2.gif" width=
"440" alt="" border="0">

Better Off Financially?

Three-fourths of small business owners say they are better off
financially than they would be working for some other company in
the same field.

"http://media.gallup.com/GPTB/finanComme/20031028_3.gif" width=
"440" alt="" border="0">

Although the majority of small business owners feel that they
are better off financially than they would be otherwise, they also
recognize that they usually work considerably more hours than
employees of other companies do. Do small business owners feel
they're better off financially simply because they work so many
hours?

On this question, small business owners are more evenly divided
-- about half of the nation's small business owners (48%) feel that
they earn more per hour in their business than they would earn as
an employee of another company. Thirty-six percent say they earn
less per hour, and 14% say they earn about the same.

"http://media.gallup.com/GPTB/finanComme/20031028_4.gif" width=
"440" alt="" border="0">

Do It Again?

Despite the poor economic conditions of the past several years
and the inherent challenges they face, small business owners are
not only satisfied with their occupation, but almost uniformly feel
successful. Add to this that most feel they are better off
financially than they would be otherwise, and it is not surprising
that 81% of the nation's small business owners say they would
become small business owners again instead of doing something else.
Nor is it unreasonable to expect public policy-makers to do more to
build on this success, by more aggressively encouraging Americans
to become small business owners.

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"440" alt="" border="0">

*The new Wells Fargo/Gallup Small Business Index is not based
on a survey of the bank's small business customers. Instead, it is
based on a nationally representative random survey of small
business owners from across the United States. For this initial
baseline survey report, Gallup conducted telephone interviews with
591 small business owners (having $20 million or less in annual
sales) over the period of Aug. 5 to Aug. 20, 2003. For results
based on this total sample of small business owners, one can say
with 95% confidence that the margin of error is ±4
percentage points.

Small business owners would do it all again

Entrepreneurs don't need to retire?

Here's another great article from the Gallup poll that I believe is still relevant. Many Americans working in the corporate world are counting the days until they can retire. But what if you were your won boss and doing something you love? Then you basically don't need to retire...

Source: http://www.gallup.com/poll/20626/Many-SmallBusiness-Owners-Will-Work-Until-They-Drop.aspx

Among the advantages of being a small-business owner is the ability to decide for yourself how you'll handle your retirement. While many younger Americans may look forward to retirement as a time to stop working, as people grow older they often begin to see retirement simply as a change in lifestyle -- not a time to sit on the beach and cease being productive.

A recent Wells Fargo/Gallup Small Business Index survey* shows that fewer than one in five small-business owners plan to stop working and retire over the long term. While nearly two in three expect their businesses to keep going after they stop working, only two in five of these people think a family member will take over and run their businesses in the future. For many small-business owners, then, the sale of their business is clearly a significant potential source of retirement assets.

Most Owners Plan to Stay Involved

In the long run, 42% of small-business owners say they plan to cut back on work but maintain involvement in their businesses. Thirty-eight percent say they will never retire until forced to do so for health reasons. Just 19% say they expect to retire and stop working.

Most Owners Expect Their Businesses to Keep Going

Sixty-three percent of small-business owners say they expect their businesses to keep going after they are no longer working, while 34% say their businesses will come to a stop.

Most Owners Say Their Businesses Will Be Sold

Of those small-business owners who expect their businesses to continue after they stop working, only 41% think someone in their families will keep it going. Twenty-one percent of small-business owners expect to sell the business to someone or a group of people currently working for it. One in three expect to sell it to someone or a group of people outside the business.

Why Should Small-Business Owners "Retire"?

Ninety-six percent of small-business owners say they are successful, 91% say they are satisfied being small-business owners, and 84% say if they had to do it all over again, they would still become small-business owners. In sum, many small-business owners love what they do and have been successful at turning something they enjoy doing into a good living.

So is it really surprising that they don't want to stop working and retire? As they get older, it makes sense that these owners will slow down and work fewer hours but stay involved in the business they enjoy. It also makes sense that they'll stop working altogether only when forced to do so for health reasons.

In this regard, it's interesting to note that many other Americans who do not own their own businesses dream of "retirement" as a time when they can start their own small business by converting their hobby or something else they love to do into something that will allow them to maintain their desired lifestyle in retirement. Obviously, many of today's small-business owners are a step ahead in achieving this kind of "retirement" goal.

*Results for the total dataset are based on telephone interviews with 600 small-business owners, conducted Sept. 26-Oct. 6, 2005. For results based on the sample, one can say with 95% confidence that the maximum margin of sampling error is ±4 percentage points.

Entrepreneurs don't need to retire?

10 things to know before you pitch a VC for money

I am lucky - I was able to start my business without raising having to raise Venture Capital (VC) - but I have known several friends who thought bigger and needed to raise VC funds. Some made out fine - others crashed and burned with their pitch. Hopefully this video will help you hear a "YES".

Thinking startup? David S. Rose's rapid-fire TED U talk on pitching to a venture capitalist tells you the 10 things you need to know about yourself -- and prove to a VC -- before you fire up your slideshow.

10 things to know before you pitch a VC for money

Mark Cuban - my hero

In my entrepreneurship class during my MBA, we started off by introducing ourselves and then saying who our business hero was. I said Mark Cuban, because I wanted to ultimately own a sports team after I made it big. One girl in the class asked, "Isn't he that annoying guy?"

Well Cuban has a blog, and on that blog he's doing his own economic stimulus package. He's going to fund people who post comments on his blog that he sees fit. Check out the posting here, and take note of the "rules" he has.

Take note of rules #3 and #4:

3. It MUST BE CASH FLOW BREAK EVEN within 60 days
4. It must be profitable within 90 days.

Now I see why this guy is my hero. He follows the principle of be patient for growth and impatient for profit. Too many companies have the delusions of grandeur and want $50 million for a website with no business model (i.e. some way to make money).

Lesson to people looking to be an entrepreneur... Figure how to make a little profit. It'll go a long way towards getting funding.

Mark Cuban - my hero

To stay or not to stay?

Couple of thoughts on Tom's earlier blog about the paradox of replacement income...

I believe staying in the corporate world after matching your salary is part of a priority call you and your family made. It's very analogous to someone who decides to take a job that requires longer hours in exchange for higher pay (except in Tom's case, he's decided to keep a job that requires 40 hours a week in exchange for higher pay). If your priority is to leave your corporate job, it requires some planning and a lot of choices to be made. Much like if the decision is made for a woman (or a man) to quit working to take care of the kids instead of having a dual income.

For most people, when income goes up (no matter how you get it), they fall into the "gas" law. A gas expands to fill the space it's contained in. Expenses expand to fill the amount of money you make. The money you make can be from a raise in your corporate job or in your own business.

Tom's entry gave me great insights in my quest for significant income outside of the corporate world... that I need to consciously plan on what my financial priorities are and make the right choices along the way. If my priority is to leave my job, then I need to plan for that. If it isn't, I can make different choices.

Now this point is all moot if you can make your time more valuable... if you can make more money per incremental hour doing your own thing than at work, then you would actually lose money by staying in your job.

To stay or not to stay?

It's risky NOT to be an entrepreneur

Everyone talks about how risky entrepreneurship is - and if you just take a blind leap it can be. But as you have seen from our postings here at the Corporatepreneur we don't think entrepreneurship has to be risky. In fact with a solid plan it can significantly decrease the risks and stresses in your life.

i believe starting a business on the side while still working a full-time job is a safe way to go. Please be conscious of any COI's (conflicts of interest) or other issues with you current job, but as long as you aren't competing with your employer either for your time or customers - you should be fine. And then you can keep that steady paycheck while growing something on the side.

Here are the risks of NOT trying to start your own business with some articles from some of my other favorite entrepreneur blogs.

1) You could become "that guy" or "that gal"
2) Your corporate job isn't secure anyway
3) You risk not living up to your TRUE potential!

I think the Corporatepreneur approach offers the not only the safest way to start a business - but the safest way to live your life. You keep doing what you are doing with the upside of finding your own entrepreneurial niche!

It's risky NOT to be an entrepreneur

The Wealthiest Americans are Business Owners

The TaxFoundation.org puts a summary together of individual income tax payers. I kept this one from a few years back because I thought the comment they had on business owners was important. Basically if you really want to be rich - start a business!

Source: TaxFoundation.org

Over the past 25 years, the number of taxpayers reporting business activity on their individual tax returns has grown at an exceptionally rapid rate. Between 1980 and 2004, as shown in Chart #7, the total number of sole proprietorships, partnerships, farms, and S-Corporations more than doubled, from 13.3 million in 1980 to 27.5 million in 2004.



S-Corporations alone grew almost seven-fold, from 545,389 in 1980 to roughly 3.5 million in 2004, and they now far exceed the number of conventional C-Corporations. When we look carefully at the distribution of these tax returns, a clear picture emerges: an extraordinarily high proportion of high-income taxpayers have some form of business income (schedule C, E, or F) and as their incomes rise, so too does the likelihood that they have business activity.

Overall, as is shown in Chart #8, 43 percent of taxpayers in the top 20 percent have business income, twice the percentage of those in the middle income group. Of those taxpayers in the top 1 percent – those earning more than $300,000 and subject to the highest marginal tax rates – nearly three quarters have business income. And for taxpayers with incomes above $1 million per year, nearly 83 percent have business income.



Remarkably, because so many taxpayers now have business income (or are paying their business’s taxes through their individual tax form), Tax Foundation economists estimate that taxpayers with business income paid 54.3 percent of all individual income taxes in 2004.

What this means is that calls to shift the tax burden even further up the income scale will, in fact, end up penalizing business owners and entrepreneurs, endangering our long-term economic vitality.

Here's my take on the data - if you work hard as an employee you can make $100,000 - $200,000 per year. BUT if you want to make $500,000 or more in a year, you probably have to be either a sports athelete or a business owner.

The Wealthiest Americans are Business Owners