According to a recent Gallup Survey, optimism among small business owners is the highest it’s been in eight years. In fact, “the percentage of small-business owners expecting company revenues to increase over the next 12 months rose from 48% to 58%.”
What’s causing this optimism? It probably has something to do with the following nine trends that are explaining why small businesses are thriving now more than ever.
1. Small business owners are motivated for the right reasons.
After surveying more than 1,000 of its small business customers from all 50 states, Guidant Financial found that “dissatisfaction with Corporate America” ranked as the main reason why respondents pursued business ownership in 2016. However, that motivation doesn’t exactly explain why small businesses are becoming successful.
While being dissatisfied with Corporate America may be the nudge that small business owners need to take the risk of starting their own business, they’re following their passions and not just the dollars.
“Successful entrepreneurs are rarely motivated solely by money (ERON’s top executives, and Bernie Maddoff are good examples of men motivated by making money at all costs.),” writes Lahle Wolfe, founder and CEO of LA Wolfe Marketing. “Successful entrepreneurs achieve wealth because they believe in what they are doing and inject personal core values into how they build a business: Wealth is their reward; not their god.”
When you’re proud of your business, “it will convey in everything you do. Your passion and confidence will get other people – customers and investors – excited about the business and you will have an easier time establishing your business’ credibility,” adds Wolfe.
Starting a business for the right reasons will also guide you in making better business decisions and avoid burnout.
2. Businesses are being started at the right age.
While the age 50-59 demographic remains the most popular age among Guidant Financial clients, there was an 84 percent increase in entrepreneurs age 30-39. That’s actually a big deal because the ideal time to start a business is your 20s and 30s. Why?
- Because a starting a business as early as possible allows you to reap the rewards of success for longer.
- When you’re younger you’re better suited to handle the potential risk of failure.
- You have the motivation and energy it take to start and run a business. As you get older, both with decline.
- The younger you are, the more adaptable you are.
- Starting a business in your 20s or 30s allows you to build several businesses. Even if your fst venture failed, you can use that experience to launch a better business the next time around.
3. Small businesses are opening in the right states.
As I’ve discussed before, when considering the location of your business, you need to take into account factors like;
- Proximity to your friends and family.
- Cost of living will be.
- Access to VC funding.
- Health of the startup/small business scene.
- Depth of the local talent pool.
- Legal requirements for incorporating your business.
For example, I relocated from Utah to Silicon Valley because that was a better area for me to start my business. No disrespect to my home state, but I after doing some research and weighing the pros and cons, I doubt that I would have found the same amount of success that I’ve reached today.
Other small business owners are doing the same. They’re doing their research and finding out which states are the best match for their small business idea.
And, if you’re curious, California and Texas are the top two states for starting either a startup or small business. But, also check out Washington, Montana, Colorado, Louisiana, Florida, Georgia, North Carolina, Virginia, and New Hampshire.
4. The right type of businesses are being launched.
Guidant also discovered that “buying a new startup or franchise was the top choice at 57 percent, followed by buying an existing startup or franchise at 39 percent.”
While there are plenty of entrepreneurs and small business owners willing to take the leap in starting their own business from the ground-up, there’s also more options than ever to purchase an existing business or franchise. The main reason? Baby boomers are getting older, which means that they’re going to have to transfer the business to someone else. In fact, it’s expected that more than 70 percent of these businesses are going to change hands.