Small business owners are still crazy after all these years - thank God
"Still crazy after all these years."
That's the title of a 1975 song and album by the legendary Paul Simon. Hearing that song – for the zillionth time – makes me think about what makes small business owners different.
It's the crazy way they look at the world.
Entrepreneurs think about challenges, imagine outcomes, appraise risk, project potential, and measure all of that against their resources and themselves, differently than everyone else. And when they decide to move forward, like the poker player who pushes all his chips to the middle of the table, small business owners are all in. Against all odds. No one else in the marketplace does that.
Still crazy after all these years.
Mountains of ominous evidence should dissuade any sane person from starting a business these days. The U.S. Small Business Administration (SBA) reports over half of all small businesses fail in the first four years, not five, as it was in 1999. There are many reasons for this 20% increase in small firm mortality, but high on the list was the 2008 financial crisis. That high-finance meltdown resulted in millions of innocent and unsuspecting small businesses becoming collateral damage. Those that survived experienced what I've termed the Main Street Lost Decade. Today, even though the strength of the real economy is deep and wide, every Main Street business owner knows we're one credit-default-swap tsunami away from another Wall Street-induced economic meltdown. And yet, hundreds of thousands of new small ventures are created every year.
Still crazy after all these years.
Entrepreneurs are constantly asked questions like: "No one's ever done that before – what makes you think you can?" "How're you going to create something from nothing?" "How did you get that customer?" "How did you talk the bank into a loan?" To which small business owners have one simple, but classic response: "I didn't know I wasn't supposed to."
Still crazy after all these years.
Owning a small business is often compared to other well-trodden professional paths that could have been taken. "Why don't you get a real job?" "Your brother's job has retirement and healthcare." "If you worked for a corporation you'd get bonuses and overtime." "You know, a government job comes with annual leave, sick days and job security." But expecting a small business owner to consider a pedestrian professional path would be like asking an Olympic sprinter to compete in a 100-meter stroll.
Still crazy after all these years.
A new SBA report shows the U.S. now has over 30 million small businesses. One big reason for essentially a 15% increase in this sector over the past 20 years is a new category of startups: An unprecedented number of Baby Boomers are retiring from their lifelong jobs and, instead of riding off into the sunset in their golf carts, or taking up pickleball, they're starting small businesses.
Still crazy after all these years.
In the face of all these odds, planted in the ground with nowhere to hide, and operating in a rude marketplace that not only doesn't care if they succeed, but is indifferent to their very existence, America's small businesses:
- Create over half of the $21 TRILLION U.S. economy
- In the aggregate, are the third-largest economy on the planet
- Are responsible for 55% of innovations
- Are 90% of American manufacturers (NAM)
- Are 93% of exporters
- Provide the direct livelihood for over 100 million Americans (over 70 million weekly paychecks)
- Are the anchors, energy, and heroes of every Main Street in America.
What's crazy to everybody else sounds about right to a small business owner. Thank God.
Write this on a rock ... Still crazy after all these years. You're welcome.
Jim Blasingame is the author of The 3rd Ingredient, the Journey of Analog Ethics into the World of Digital Fear and Greed.
