Do we live in a golden age of the entrepreneur?
At first glance, it certainly seems so. Everywhere you look, it appears small businesses are proliferating from the initial sparks of creativity and offering new services that radically rewire the way we think about and interact with the world. We read about CEOs investing millions (or sometimes, billions) into science and technology, whilst being billionaires themselves. From new products that were unimaginable to someone born twenty years ago to services that make our daily lives increasingly convenient, our way of life has changed drastically as a result of bright-minded, fearless entrepreneurs. However, entrepreneurism is nothing new in our country; from British North America’s cultivation of tobacco in the early 17th century as its first cash crop which enabled a large-scale European settlement to the oil and railroad tycoons of the 19th century who spurred on interstate transportation, culture and commerce, entrepreneurism beats at the heart of United States history and culture. At the turn of the 20th century, the German sociologist Max Weber wrote that the rise of entrepreneurship in the United States was a result of this country’s religious and culturally Protestant upbringing; in Protestantism, he argued, one had a religious obligation or duty to work hard, invest one’s money, and be diligent. Regardless if this is a fact, today in the United States entrepreneurism in the United States is led by members of all ethnic and religious communities. This phenomenon also is extending to all regions of the world. And so, on the surface, it looks like we are living in a golden age in which for entrepreneurs it has never been easier to succeed.
Although entrepreneurism certainly appears to be alive, the case for rising entrepreneurism in the United States is a bit more complicated. Although entrepreneurism and start-ups seem to be exceptionally prominent in our day-to-day lives (look at the desktop of any smartphone for evidence), at the same time small business growth is not doing too hot. Although the overall number of small businesses has increased 49% since 1982, the actual birth rate of startups per year has declined by over 50% in the past three decades, from 16.5% of all businesses in 1977 to just over 8% in 2011.
Likewise, starting in 2008 the number of startup births per year has been outnumbered by business death (or closure) rate.
What was once 200,000 more firms being born than closing in 1977 and +125,000 new firms in 2005 slumped in 2011 to a negative growth of 70,000 businesses per year; although 400,000 new businesses are established in this country every year, 470,000 per year close down. Thus, for the first time in recent history U.S. businesses are now dying at a faster rate than they are being born.
At first, these above statistics might appear troubling, but rather then frightening you they should instead serve to remind you of certain facts about starting or managing your business. At the end of the day, entrepreneurs are still creating businesses, and at 400,000 per year that is many. This is not going to stop any time soon, and it certainly should not inhibit you from starting or investing in your own business either. However, a business’ birth has never ensured its success or survival; despite a strongly recovering economy, the current economic conditions for small businesses remain hostile. Regardless how innovative you may be as an entrepreneur, the underlying fact is in order to thrive in any market, you must not simply offer a great product or service. To go above and beyond, you need excellent marketing and exposure to guarantee that your business will be seen by the eyes of many. This requires investment in good website design, search engine optimization, the ongoing publication of original and interesting content, and the utilization of most if not all venues of social media for connecting with clients and customers. Using such tools creatively in tandem with being committed to your business and learning as much as possible about your field, you have little to worry about and only new opportunities to anticipate.
Regardless whether our current age should be classified as a golden age of the entrepreneur, it is as a ripe a time as ever for you and your companies’ success. Just as entrepreneurism and the entrepreneur have remained staples of North American culture for over four centuries, by doing these aforementioned things, your business can too.