Starting your own business may seem like a pretty good idea. You become your own boss, you make all the decisions, and you know exactly where the money goes. However, are the statistics on your side? Will you be an inspirational story or a drop in the sea?
The Challenge
Some people are discouraged from starting their own business simply because the market is saturated with giants that could take you out in a second with better deals, greater selection, and marketing. However, some see it as a challenge. To succeed, you need to have an original idea that solves a particular problem. Think Amazon, or Ali-Express. There are no brick and mortar stores for either one, and the selection is much bigger than you might get at, say, Wal-Mart.
The Facts
A report from 2011 states that 90% of startups fail. However, in the report, this is not due to their competition, but due to self-destruction via poor business planning and a new field. Of course, some of the information in the report may be considered outdated at this point. That being said, there is the gist of the problem: most startups fail and it takes careful planning, a clear goal, and clever money management to stay afloat.
Most of the startups in the US are founded by men between the ages of 40 and 60. Women account for about a quarter of small business owners. There are many reasons people get into starting a company, with the most common one being that they want to be their own boss or they are passionate about doing something.
Why the Failure
The biggest factor is the inexperience. New business owners are not 100% sure how to run a business unless they worked alongside a business owner in the same sector or industry. Another frequent reason for failure is failing to fulfill the market need. Do you know the idiom “he could sell ice to Eskimos”? That wasn’t a dare. You need to see whether the market has use for what you are offering.
While you have to spend money to make money, it would be great if you would not lose the money in the process. Make sure you have enough for a contingency plan and never invest the money you are not prepared to lose forever.
What Industry to Pick
These days, when we hear the word startup, the first thing that pops into mind is a small, lax company with people in their early 20s at the latest dressed casually and developing software. In truth, software publishing is one of the least profitable industries at the moment, in addition to baking, beverage manufacturing, and running a grocery store.
The most likely to succeed are not very exciting, but they are the most stable. Brokers, accountants, dentists, doctors, and lawyers are still the most profitable occupations. Take this information with a grain of salt. First of all, it’s just statistics. Secondly, every location and market is different and this information refers to the US in its entirety in 2019.
Defining Success
What is your endgame? Do you expect to come up with a revolutionary idea that will turn you into a giant on the market? Do you, perhaps, hope to be bought out by a mega-corporation and live comfortably doing nothing? There are those whose idea of success is providing for their family or having a perfect combination of money and free time.