Hello David, and thank you for your clarification :)
Let's just dig right in:
1) I need to know what percentages of new "start-up" small businesses
make it pass the first couple of years.
* * *
"Depending upon which statistics you believe, the chances of a new
[small] business surviving for five years are between 30 and 50
percent.? (?Starting a Small Business,?
?According to the U.S. Small Business Administration, over 50% of
small businesses fail in the first year and 95% fail within the first
five years.? (?Are You Ready?? United States Small Business
?Although many people believe that 80 percent of all small businesses
fail within five years, statistics from the U.S. Census Bureau reveal
a different story. The Census Bureau reports that 76 percent of all
small businesses operating in 1992 were still in business in 1996. In
fact, only 17 percent of all small businesses that closed in 1997 were
reported as bankruptcies or other failures. The other terminations
occurred because the business was sold or incorporated or when the
owner retired.? (?Small Business in America,? U.S. Department of
Labor: http://www.dol.gov/odep/pubs/ek00/small.htm )
2) How long the average small business lasts.
* * *
According to The NETWORK of City Business Journals, the average small
business lasts 17.6 years. (?Small Business Rules,?
3) For people joining "business opportunities" (those you see in
magazines and the internet), what percentage of them succeed (we'll
define "success" as this: they will still be in that business
opportunity after two years).
* * *
I can find no studies that attempt to find out how many people who
respond to ?business opportunities? end up with a viable, successful
business. Nor are their stats about what percentage of those ?business
opportunities? are legitimate. However, according to the Federal Trade
Commission, .45 million Americans per year are victims of ?Business
opportunities? ads. (?Scams Hit 11% of U.S. Yearly, Survey Finds,?
4) For e-commerce and other internet related businesses: How long does
the average internet business last and what percentage of them will
"drop out" after two or three years?
* * *
?Dot com business failures have been exceeding high. By the end of
January 2001 18% had closed their doors since December 1999, according
to Challenger Gray & Christmas. However, you look at it, business
failure is a fairly probable event. It is rare that a company has a
long-term survival rate.? (?Reasons for Start-Up Business Failure &
?Twenty-two percent of the 1,842 companies first financed in 1999 have
already gone out of business, compared with an average of 15 percent
for companies started over the previous seven years. Of the companies
initially financed in 2000, 18 percent are already defunct. In all,
the amount invested in startups founded since 1999 that are no longer
operational totals $15.3 billion... According to the report, the sheer
volume of funding during the so-called "dot-com boom" could be the
major factor in the failure rate. The number of initial financing
rounds grew steadily throughout the early '90s, but between 1998 and
1999 it almost doubled, and then grew by an additional 44 percent in
2000. Analysts agree that the market simply couldn't support this
overabundance of companies.? (?Dot-com Era Start-Ups Still Feeling
Woes,? http://www.internetnews.com/stats/article.php/1467101 )
5) What percentage of people end up returning to the workforce after
owning their own small business or home-based business?
* * *
After an exhaustive search, I was unfortuantely unable to come up with
stats for this. As an aside, however: ?It has been said, "that most
entrepreneurs fail three to five times" before they actually start a
business that succeeds.? (?How Long Should You Hang Onto Your
Home-Based Business Dream??
6) If you can find out their reasons for returning to the workforce,
that would be great. also.
* * *
Ultimately, because their business fails financially or emotionally.
Some common reasons for quitting the self-employment gig:
?Reasons Why Entrepreneurs Quit
No clear and direct goals
No interest in acquiring special knowledge needed to continue
Wishing instead of willing
Looking for shortcuts to success
Fear of criticism?
(?Winners Never Quit,?
?1. What type of debt the entrepreneur is accruing, and how many bills
and necessary needs are being neglected. No one should live without
food, clothing, shelter or the necessary medical care needed for a
gratifying life. If a home-based business is constantly leaving the
business owner without funds with which to sustain life, then it is
probably time to quit.
2. What type of emotional pain is the entrepreneur facing? If the
business has become so stressful because of mounting debt, or the
entrepreneur's family is turning against them because of the business,
then it is probably time to quit.
3. If there is a chance of losing a home or other holdings and
property because of the bills engendered during the business, then it
is probably time to quit.
4. If the frustration of having the business and handling the day to
day operations surrounding the business is greater than the pleasure
of owning the business, then it is probably time to quit.? ((?How Long
Should You Hang Onto Your Home-Based Business Dream??
7) How many hours a week does the average home-based business or small
business owner work?
* * *
?The self-employed worked 40.8 hours per week in 2003 compared with
35.5 hours for employees, on average. Even more striking is the large
difference in those who usually worked over 50 hours per week in 2003:
33% of self-employed persons worked over 50 hours compared with only 5
percent of employees (Figure 9). Clearly, the self-employed usually
work longer hours than employees.? (?Do the Self Employed Work Longer
Hours than Employees??
The average small business owner works ?slightly longer hours to boot
(45 hours a week compared to the 41 hours of a salaried employee).?
(?Going Into Business For Yourself,?
?The average small-business owner works 52 hours a week, according to
a 2000 study by New York marketing firm Willard & Shullman. Meanwhile,
May figures from the U.S. Bureau of Labor Statistics indicate that the
average American production employee puts in 34.2 hours.? (?Not All
Business Owners Keep Slavish Hours,?
8) What is the average earnings of people who own a small business or
home-based business compared to the average workforce?
* * *
?According to Messenger?s study, self-employed people tend to earn 70
to 80 percent of what salaried employees earn (although underreporting
of income could account for the difference)...? (?Going Into Business
For Yourself,? http://www3.ccps.virginia.edu/career_prospects/Trends/self-employment.html
?The typical small-business owner earns around $40,000 a year.?
(?Small Businesses Work to Survive and Thrive Downtown,? San Antonio
Business Journal: http://sanantonio.bizjournals.com/sanantonio/stories/2004/04/05/focus5.html
?... the Bureau of Labor Statistics reports the average annual wages
in the U.S. as $36,764 for 2002.? (?What is the Average Salary in the
U.S.?? http://ask.yahoo.com/ask/20040518.html )
9) What percentage of those who decide to start their own small
business or home-based business had previous business experience
(e.g.: as a store manager in their former job).
* * *
Surprisingly, there doesn?t seem to be a study that addresses this
directly. However, the following statistics may be helpful.
?The data allowed Lazear to test such factors as gender, ethnicity,
age and experience. None of these, on its own, seemed to make a big
difference. However, one factor stood out: the number of different
positions the individual occupied previously. Every additional role
played added 2.26 percentage points to the probability that the
person's next job would be as an entrepreneur. Those with fewer than
three roles had only a 1 percent chance of turning to
entrepreneurship. Those with more than 16 roles had a 30 percent
chance. ?If you perform different roles, you pick up different skills
and that makes you multidimensional,? Lazear said.? (?Study of MBAs
Points to What it Takes to be an Entrepreneur,?
?Employees who performed marketing functions in their most recent job
were 24 percent more likely to found their own organization. Working
in a high-tech industry also increased the rate of entrepreneurship by
a third. However, results suggest that employment in a family business
discourages the transition to entrepreneurship by about 20
percent...the more organizations a person worked for, the more likely
they were to become an entrepreneur. ?Gaining exposure and experience
with the routines and practices of many different organizations
clearly increases your arsenal of solutions for tackling the difficult
problems that are an inevitable part of running a start-up,? says
Dobrev. ?Though prior experience with more organizations doesn't
necessarily mean experience with better organizations, variation
allows you to choose the best set of options and solutions by
selecting from the high end of the distribution of your experiences.
The results show that the likelihood of becoming a founder increases
by 25 percent with each previously founded organization and by 6
percent with each organization in which a person has worked as an
? (?Will They Stay Or Will They Go??
?Small business owners are also significantly more educated than is
the wage and salary population. Note that 37 percent of the full-time
self-employed are college graduates or have advanced degrees compared
to 29 percent of those who earn a paycheck.? (?The Shape of Small
Business,? http://www.nfib.com/object/PolicyGuide2.html )
?Most of those who started their own businesses are well educated.
About 59.7 percent have received at least some college education, and
more than a tenth of this group (12.6 percent) has graduate school and
professional school degrees. A little less than two fifths have
reached high school level (37.5 percent).? (?A Profile of America?s
Entrepreneurs,? http://www.powerhomebiz.com/vol14/profile.htm )
??The enthusiasm and willingness to take a risk can make up for the
lack of some experience,? says Debbie Brown, director of the new
Disney/SBA National Entrepreneur Center in Orlando. It depends on the
field, says Antonio Villamil, a Miami-based economist, former
undersecretary of commerce during the first Bush Administration and an
entrepreneur himself. ?Youth is good if you have a new idea and are
producing [cutting-edge] products such as computers or hardware. But
if you're dealing with knowledge-based services such as accounting or
economics, it's important to have experience and knowledge,? he says.?
(?Young Entrepreneurs Take Risks,? available for a limited time in
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