The Trajectory of an Entrepreneur, Statistically Speaking
In a down economy, who could possibly be willing to start up a business? The answer may surprise you.
Perhaps it is people that have experienced a layoff, and despite hard work just can’t find another position that meets their needs. Or maybe they have a little money set aside, strong skills developed through years of work experience and they see an opportunity before them now to branch out on their own.
Contrary to common thinking, just as many businesses are started during recessionary times as during good economic times (statistics taken from a recent study by the Federal Reserve Midwest region). Long-term viability of businesses are also similar, from either starting point. Starting a business during a recession if the project idea is right may be just what is needed to help renew the local economy!
Out of curiosity, we looked to our own SWIF microloan program statistics to analyze the numbers of unemployed that received loans from us since July 1, 2009. Here’s what we found:
- Since that date, SWIF has made 30 microloans (small loans under $35,000).
- Nine of those loans were to people that had lost their jobs during the recession (almost 30 percent).
- Historically, 60 percent of our microloan portfolio has been comprised of women but since the recession started our portfolio has become an even split between men and women.
As the recession has moved through most industries, it is clear that the market has made many decisions for people while at the same time opened up new opportunities.
Passion, experience and capacity are still the most important factors that are needed to make a new business venture successful for the long haul. The opportunity comes when people are forced to look at their career and realize that things will most definitely change over time. Owning your own business is clearly not for everyone. But, if the opportunity is right and you have the skills and capacity this could be the time to take the plunge.
Berny Berger is the Southwest Initiative Foundation’s Microenterprise Program Coordinator. She started SWIF’s microloan Program in 2001 and has been active in both state and national organizations focused on building entrepreneurship in rural areas.
photo credit: Banalities
Calling All Early Boomers…Baby Boomers, that is.
Got an itch to start a new business? You’re not alone . . . you’re part of another ‘boom’ or movement, of sorts.
According to the Kaufman Foundation, early boomers are the fastest growing segment of new business start-ups – a 16 percent increase, to be exact. That works out to 10,000 new businesses every month. Maybe it’s a combination of circumstances . . . 401K shrinkage, a wealth of experience, some money poked away for a rainy day or maybe we just finished the honey–do list and are getting bored of that thing called retirement.
The trend is so strong that the Kauffman Foundation predicts a sustained entrepreneurship boom, not in spite of the country’s aging workforce but because of it.
Other researchers agree. “The older you are, the more likely you are to be self-employed. I don’t think it’s new, but I do think it’s growing,” says Edward Rogoff, the Lawrence N. Field Professor of Entrepreneurship at Baruch College in New York. “Their chances of finding traditional employment are restricted, so more of them get pushed into entrepreneurship. Or they just find it attractive.”
As entrepreneurs, boomers have a lot going for them – including a career’s worth of accumulated knowledge about an industry, plus a network of people to tap as financiers, suppliers and customers. Recession or not, they’re also more likely to have retirement or other savings to fund a new venture. In many cases, it can become the perfect storm.
As with most things, it won’t necessarily be easy. Older entrepreneurs face obstacles their younger counterparts needn’t worry about – especially time. “If you’re starting a business as a way to supplement your income, you can’t wait the typical five years or more that younger entrepreneurs are told to expect before turning a profit,” Rogoff says.
So, boomers, if you’ve got the itch, go out and scratch it. You’re not alone and you could find some unexpected company while you’re out there.
One resource…The Southwest Initiative Foundation’s Paul and Alma Schwan Aging Trust Fund has a program called Encore Entrepreneurship dedicated to nurturing older entrepreneurs through networking, training and in some cases financing.
Greg Jodzio is an Encore Entrepreneur. He is retired from his first career as a sales executive and is now spending his time growing his newest venture, Red’s Hot, LLC, and providing business training and assistance to other Encore Entrepreneurs.
Power of Small
We’ve all heard the phrase don’t sweat the small stuff, but I’ve taken some time lately to do some reading and have enjoyed a book that contradicts that very notion.
In the book, “ The Power of Small” Linda Kaplan Thaler and Robin Koval provide a number of ‘ah-ha’ moments for me.
One of their best thought provokers is in the chapter Small Talk. They quote an insightful Studs Terk
el the legendary radio host from Chicago: “We are more and more into communications and less and less into communication” He makes the point that we’re losing our small talk-ability, an important human ingredient in getting to know, and eventually trust others. These are important elements in accomplishing cooperative common goals.
Electronic media is convenient and is clearly an effective time saver, but are we paying for interpersonal productivity with the growth of social phobia which now affects 13% of the population.
So maybe ‘moderation in everything’ still plays a part; try taking a little of Kaplan and Koval’s advice. Make a point at least once a week, to walk down the hall and stick your head into a co-worker’s office and talk to them rather than e-mailing, tweeting, or facebooking them. A voice inflection, facial expression, a smile and small talk provide the social lubricant that can get things started and can pay off in surprising ways.
Greg Jodzio is an Encore Entrepreneur. He is retired from his first career as a sales executive and is now spending his time growing his newest venture, Red’s Hot, LLC and providing business training and assistance to entrepreneurs through the Southwest Initiative Foundation’s Microloan Program.
photo credit: Jeffrey Beall
Entrepreneur Beware!
Ok, we’ve all read the signs ‘buyer beware’… but entrepreneur beware? The reality is that people in business are subject to all kinds of fraud…the opportunity to be taken as an entrepreneur runs the table from shoplifting to the high-stakes con artist who is after serious amounts of your money. And in today’s fast-paced, hyper-active electronic world, the stakes are even higher.
In the last year, two businesses that I work with have been very close to losing a large amount of money and the would-be perpetrators used almost the exact same scheme…both used Tele-relay services to communicate. Both used hardship in some way to tug at the victim’s desire to do good. Both tried using stolen credit cards, and in one case, succeeded. Both involved large orders for merchandise. In the latest case, Trevor Suckow, owner of the Friendship Café in Clarkfield, MN started asking questions about how and why…You can read his story as published last week in the Granite Falls Advocate by following the attached link.
Here are a couple of quick questions you should always ask yourself when that order that appears to be ‘too good to be true’ comes in…
- Why are they buying from us?
- Does the address on the credit card match the address to where you are delivering the product? This is important, because if the address is the same, and the card has been stolen, the credit card issuer will not leave you stuck with the bill.
- Can you verify the order with someone locally?
Follow Trevor’s advice, if it sounds too good to be true, it probably is…beware – danger is lurking!
Kurt Thompson is a Program Officer at the Southwest Initiative Foundation where he leads the Microloan and Entrepreneurship Programs. He also serves as business coach and mentor to small businesses by offering one-on-one technical assistance to loan clients.
photo credit: TheTruthAbout…
Redline Manufacturing Receives Loan Assistance from Southwest Initiative Foundation
New business benefits from Microenterprise Loan Program
JUNE 29, 2010—Redline Manufacturing, owned and operated by Hutchinson-native Matt Cheney, recently received loan assistance from the Southwest Initiative Foundation’s (SWIF) Microenterprise Loan Program for the start up of a machining and manufacturing business in rural Litchfield. The business produces a wide variety of attachments to forklifts and skid loaders for the agri-business, agricultural and light construction industries.
Cheney has over nine years of management experience in the fabrication of products similar to what his business offers. He will focus on producing standard products including forks, safety platforms, self-leveling platforms and grapples but will also offer the ability to customize any product. Redline Manufacturing is located at 70127 330th St., between Litchfield and Kimball and can be reached at
320-398-7712.
“SWIF is very pleased to be able to assist with the start up of Redline Manufacturing,” said SWIF Program Officer Kurt Thompson. “Minnesota is known for manufacturing and it is a strong part of the state’s economic base. Redline has the potential to grow in its niche market.”
Proceeds from the loan were used to purchase equipment and inventory for the start up of the business. SWIF’s Microenterprise Loan Program offers loans of up to $35,000 for starting or expanding for-profit small businesses located within the 18 counties of southwest Minnesota that have a need for additional sources of funds. In addition, technical assistance is available from SWIF as needed for the length of the loan. The program receives funding assistance from the U.S. Small Business Administration, as well as from the U.S. Department of Agriculture.
The Southwest Initiative Foundation is a regional community foundation dedicated to advancing southwest Minnesota through leadership, relationship building, program development and philanthropy. The Foundation has contributed more than $50 million through its grant and loan programs in southwest Minnesota. It has also helped more than 480 businesses start or expand through its business finance programs, which have created or retained more than 7,600 jobs. The Southwest Initiative Foundation is an equal opportunity provider. To learn more, visit www.swifoundation.org.
