Are you afraid to quit your 9-5? It’s time to face your fears and take a look at these 10 Small Business Facts you’re afraid to know but probably should as a new or potential entrepreneur.
Starting a small biz can be an exciting time! It’s the first step towards your financial independence and a clearer vision towards the freedoms of “being your own boss” will allow.
But it can also come with doubts and anxiety as questions of the unknown start to overwhelm you at 2 a.m. I get it! So let’s do the logical thing and look into some small business numbers that you may (or may not) like. Because awareness is the first step my friend, and if we know what we’re up against, we can better prepare ourselves for the challenges that may lay ahead in our entrepreneurial journey!
10 Small Business Facts You’re Afraid to Know (But Should)
1. What are my chances of failing?
I know what you’re primarily concerned about, so let’s get this bad boy out of the way. The truth is, you’ve got a 50-50 chance of making it. According to the Bureau of Labor Statistics 2016, 50% of small businesses survive 5 years or more and only one-third will survive after a decade. So summon your inner Destiny’s Child cause you are a survivor, you’re gonna make it, you’re not gon’ stop, you’re go’ work harder (WHAT!?).
2. How BIG is the small biz market?
According to the SBA Gov 2016 Report, there were 28.8 million small businesses in the U.S. as of 2016 (that accounts for 99.7% of U.S. businesses!) So you’re not exactly the only person still pursuing the American Dream – but you’re also not the first or the last person to experience exactly what you’re feeling right now.
3. What is the death of small businesses?
Okay that was a little dramatic. But the truth is, the most significant challenges to the future growth and survival of small businesses is Economic Uncertainty (49%). That’s closely followed by Decline in Customer Spending (29%) which is tied with Regulatory Burdens (29%), and of course, the good ol’ Cost of Health Insurance Benefits (28%). (Source: (NSBA) National Small Business Association 2016)
4. How much is this small business going to cost ME?
Got $10,000? Then you’re in (small) business baby! 64% of small business owners start with $10K or less – unfortunately, these are primarily self-funded (75%) according to Intuit in 2014.
5. How much money will I make as a small business owner?
As of 2017, Fundera found that 86.3% of small business owners reported to take less than $100,000 annual salary and a crazy 30.07% of small business owners don’t even take a salary. Meanwhile, the national average salary for CEO’s is around $163,000. But that’s non of my small business.
6. Are small business owners smarter than a fifth grader?
Yes, yes they are. Now let’s use our elementary skills to break down this yummy pie graph! Fundera’s findings show 53.78% actually have a Bachelor’s degree or higher compared to the national average of 33%. And surprisingly, only 11.98% end their formal education after high school (cue Kanye’s Graduation Day track) compared to the national average of 41.1%.
7. Where my #BossLadies at?
As of 2016, there is an estimated 11.3 million women-owned businesses in the U.S. The fastest-growing states for women-owned firms are Florida, Georgia, and Texas (Source: Womenable 2016). We (women) own 38% of U.S. businesses.
8. How many small businesses are owned by minorities in the U.S.?
- Reported in 2012, minority-owned business accounted for 28.8%.
- As of 2016, almost 5 million minority women-owned firms.
- In 2012, there were 2.5 million businesses owned by veterans (Thank you for your continued service to the U.S. of A!)
9. Who would ever want to work for me?
Unfortunately, 45% of small businesses found few or no qualified applicants for their job postings according to NFIB 2017, and it will take an average 27 days to hire this new employee.
But I’d like to think this is issue is better than traditional corporate sectors who reject candidates because they don’t “fit the role” or their value falls outside of the job opportunity.
Let’s face it: small business employment job descriptions might as well read – “must be able to wear multiple hats – all at once”, and that’s okay. Because finding that rockstar employee will be well worth the wait.
10. How do I keep my small business rockstar employee happy?
The number one way to keep your small business employees happy is improvements in their benefits offering (72%) according to Aflac 2017.
*BONUS SMALL BUSINESS FACT:
11. Will I regret starting my own small business?
Given all of these possibly scary statistics and challenges you’ll face as a small business owner, should you even bother?
Well YES, of course you should! This was a trick question!
92% of respondents to Fundera’s survey say they do NOT regret starting their own business. Creating new jobs, fulfilling you passion, and providing personal, delightful products and services that improve our economy and local neighborhoods are a contribution directly attributed to small business owners and entrepreneurs – just like you!
So go get a better night’s sleep after reading up on your Small Biz facts – you’re going to need it to keep living the American Dream!
Your turn! If there’s anything we missed on our list, please leave your thoughts & feedback in the comments below.
Keep the inspiration going? We got you:
- Phoenix Business Journal – 40 under 40 Kick Off Event 2017
- Levo League Phoenix – Mentor Power Hour
- Levo League Phoenix – Event Wrap Up