Mastering the new entrepreneurship


The barriers to entrepreneurship are crumbling, and every six months, technology makes starting a business easier and easier.

As a result, entrepreneurship has become more appealing to a wider range of people. If you measure success in terms of personal growth and flexible work, their success rate is sky high.

Here’s a list of the old and new ways of thinking when it comes to starting your own business:

Old: Entrepreneurs are born with a specific set of character traits.

New: Entrepreneurship is learned.

There is no single way to be an entrepreneur, according to research by Saras Sarasvathyof the University of Virginia Darden School of Business. There are actually many different types of personalities that can succeed because there are so many different ways to structure a business.

The key is to pick a business that plays to your personality traits. For example, someone who has lots of charisma and leadership skill, but little interest in day-to-day details, should probably run a larger company than someone who’s capable of doing all the dirty work required for a one-man show.

Old: Raise money and spend a lot of it on advertising.

New: Raise no money and spend no money on advertising.

The viral efficiencies of Web 2.0 make today’s Internet very effective for spreading good ideas quickly. You can think of an idea and test it right away, and if you get traffic to your site the idea is good. If there’s no traffic, that’s not a sign to spend money on advertising, it’s a sign that you don’t have a good idea.

Reddit, for example, was started by two twenty-somethings who emailed their friends and invited them to use their new online tool. Their friends liked Reddit and passed the email on to their own email lists. No advertising budget whatsoever was required, and two years later Conde Nast acquired Reddit.

Old: Women will get power in corporate America and change it.

New: Women are getting what they want by leaving corporate America to start their own businesses.

While a steady stream of press releases touts the increasing flexibility of corporate jobs, it isn’t happening in practice. But instead of pounding their fists against the doors of corporate human resources departments, women have put their energy toward growing their own businesses.

More businesses are started today by women than by men, and most of the sole proprietorship businesses are run by women. This tells us that women have won the fight for flexible jobs by creating them for themselves.

Old: The self-employed are happy because they’re doing what they love.

New: The self-employed are happy because they have control over their work and they have a flexible lifestyle.

The idea that you need to do what you love is more of a platitude than solid career advice. Instead, the best advice might be to do what fits your life best, and create a life that you love.

Rebecca Ryan, CEO of Next Generation Consulting, writes about how instead of living to work, people today are working to live. In this context, self-employment is a very effective way to create a life you want.

Old: Climb the corporate ladder, learn the ropes, then start a company.

New: Start a company to get out of climbing the corporate ladder.

Learning the ropes at a big company is sometimes slow going. You often only learn what your own department does, and if you have a really bad job, you only learn what your department does from the perspective of the copy machine. This is no way to learn about business.

The fastest way to learn about business is to try it. And since there’s very little cost to starting an Internet business, you can try one, fail, and start another, and another, as a way to teach yourself about business.

Eventually something will stick, and even if it doesn’t, you’ll probably get enough experience to skip the drudgery of the bottom rungs of the corporate ladder.

Old: Entrepreneurship is all or nothing.

New: You can test the waters by starting a company while you have a corporate job.

Setting up shop online is a matter of using your mouse and clicking on the kind of features you want in your store. And there are new ways to do business online that didn’t exist even two years ago. For example, you can buy and sell web sites on 24-hour message boards, and you can set up an arbitrage business around buying and selling web traffic.

Many new types of businesses are ideal for pairing with a career you already have. Marci Alboher wrote a handbook for starting this kind of life: “One Person/Multiple Careers: A New Model for Work/Life Success.”

Old: Starting a business is risky.

New: Staying in corporate life is risky.

Most businesses succeed, most jobs end. The statistics about most companies failing assume that most entrepreneurs want to run the next Microsoft. In fact, most people don’t. They just want a flexible, fun, rewarding job.

In that respect, if a company provides fun, flexible work for even a short period of time, you can say it’s a success even if it fails soon after.

Old: Do a lot of planning and make sure it’s going to work before you start.

New: Forget the big plan — just try it.

If it doesn’t work, just try again. This is not true for, say, starting a restaurant, but for a company with little cash outlay there’s little risk to running without a set plan.

2 replies
  1. Wendy
    Wendy says:

    Two thoughts: While gaining flexibility is crutial to many people, some need to pay the mortgage and the bills too. I’d like some idea on success rates from this perspective: maybe how many entrepreneurs succeed in making over minimum wage, or 2X minimum wage or much more for their efforts after one year or two years or some reasonable time.

    Second (and completely unrelated) thought: this seems connected to the “micro-credit” phenomenon in many developing countries whereby individuals or families (often women are targeted) received small loans to get a business started: enough to buy a cell phone or a sewing machine, for example. The individual then uses their new asset to start a business, whether charging neighbours to make and receive phone calls or making and repairing clothes, etc. The loan pay back rate for such programs is remarkably high, indicating success. This provides further evidence that thinking small can be very successful when it comes to a home based business.

  2. Joey Roth
    Joey Roth says:

    Thanks Penelope. Your article is an elegant expansion of a significant truth: the internet makes it possible to connect with mentors, suppliers, and potential customers, so that the only significant roadblock for the entrepreneur is fear, or a belief that things have to be done by the book, through the right channels. If Carol Chung of CoolHunting hadn’t discovered my Sorapot and posted it as if it were a real product, it might still be a portfolio piece instead of the first product from my embryonic business. Without design blogs like Notcot, Gizmodo, and MocoLoco, sourcing tools like Alibaba, and daily inspiration from people like Seth, Guy, and of course you, I might have some real excuses to not produce my designs independently. With this amazing connectivity though, how could I do anything else?

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