A new era for entrepreneurs and startups has begun
A New Era For Entrepreneurs
And Startups Has Begun
Image via CrunchBase
Since the recent recession, and at least partially sparked by it, I’m seeing a
real resurgence of entrepreneurial spirit, and more startup activity than
ever before. I believe the days of the “job work” mentality are thankfully
waning, with more people looking to get satisfaction by making the world
a better place, rather than just tolerating brain-numbing work to fund
According to the Kaufman Index of Entrepreneurial Activity (KIEA), the
entrepreneurial rate in the U.S. is already well above the dot.com bubble
of 15 years ago, although we have slipped a bit this year from the high
point of 320 new entrepreneurs out of 100,000 adults in 2011. It still adds
up to over 20 million non-employer businesses out there today, with more
starting every day.
The Hottest Startups Of 2013
Founders Cut Down On Startup Stress
The Hottest Global Startups Of 2013
There is additional encouraging news for aspiring entrepreneurs on many
fronts, just in case you are thinking about joining the existing ranks:
1. Valuations of successful startups have hit an all-time high. An
unprecedented number of startups, easily 25 and possibly exceeding 40, are
valued today at $1 billion or more, according to a recent NY Times article. A year
from now that’s projected to go as high as 100. Thus a record number of
entrepreneurs (and employees) are getting rich.
2. Initial Public Offerings (IPO) are back as an exit strategy. According to
a report just out, a record 156 operating companies went public in the U.S. in
2013, with aggregate proceeds of over $38 billion. That is a 65% increase in the
number of IPOs over 2012, and the highest proceeds raised since the year 2000.
Twitter was one of the most notable, with a market capitalization now up to $38
billion all by itself.
3. Funding for early-stage startups is more available than ever. According
to David Rose, CEO of Gust, venture capital investors funded about 1500 startups
last year, with Angel investors backing over 50,000 more. Of course, with more
startups, this is still a tough space, with VCs funding only one out of 400 requests
they get, and Angels limiting their focus to one out of 40. No wonder 90% of the
successful startups still bootstrap.
4. Cost of entry for a startup is at an all-time low.I can remember when
creating a web site for eCommerce could easily require a million dollar
investment. Now you can create a web site for almost nothing – and be on your
way with your latest invention or personal services. Smartphone apps can be built
for less than $10K, so who needs an investor?
5. Startup incubators and accelerators are popping up
everywhere. Business incubators were all the rage before the dot-com bubble
(700 for profit, many more non-profit). After the bubble burst and the recession,
more than 80% of them disappeared. Now they are back in every community,
with the best even waving money at graduates.
6. The world is a now single market, both homogeneous and
heterogeneous. Entrepreneurs now can think globally about the opportunity,
from day one but start locally. This approach, popularly known as “glocalization,”
means you design and deliver global solutions that have total relevance to every
local market you plan to attack.
7. Social media is a boon for entrepreneurs and startups. With the key
social media platforms today, an entrepreneur can tune a product, build a brand,
and grow the business with very low cost and a high interactivity never before
possible. The elements include communications, mobile platforms, and locationbased services.
8. Large corporations have lost their ability to innovate. Conglomerates,
which were the engines of growth and vitality in the twentieth century, have
proven themselves unable to innovate, and have a tarnished public image due to
financial woes and poor management. Most now routinely buy startups for new
technology and new products.
9. Women are a growing force as entrepreneurs. Almost 20% of young
women now aspire to run their own business today as entrepreneurs (15% in
2008), according to a recent poll by The Telegraph. They inherently have an
advantage, since women already control over 70% of household income and over
$20 trillion of consumer spending.
10. Baby Boomers are joining the fun in record numbers. The percent of
entrepreneurs who are Baby Boomer starting a business since 1996 has grown
from 14.3 percent to 23.4 percent last year. In fact, in every one of the last 15
years, Boomers between the ages of 55 and 64 have had a higher rate of
entrepreneurial activity than Gen-Y.
Looking ahead, a National Venture Capital Association and Dow
Jones press release predicts that 2014 will bring further good news for
entrepreneurs across several fronts, including more investment, greater
IPO volume for exits, greater employment opportunities at startups, and
even more improvements in the economy.
They also remind us that all is not rosy, with continuing economic
challenges and a gridlocked Congress that could change everything. One
of the great things about being an entrepreneur today is that you can lead
in countering these challenges, and actually changing the way we think
and behave in business, in our community, and our society.
The image of an entrepreneur is at an all-time high, so why would you
continue to work in a job that you hate, or provides no satisfaction? Step
into a new entrepreneur era where the definition of “work” is something
you love. It’s not too late to start.