A version of this article previously appeared in Forbes.
Marketing automation company HubSpot performed a non-scientific survey of its users, asking them a variety of entrepreneurial questions. In Which Of These 7 Fears Are Keeping You From Being An Entrepreneur?, I reviewed the survey results related to why some would-be entrepreneurs never take the plunge.
Digging deeper into the data, I found that most of the reasons people cited for wanting to be an entrepreneur made sense, though several were sadly off base.
Dreams Of Quitting Your Day Job
The large majority of all the survey respondents noted that they have considered starting their own business. This is not altogether surprising, as many of HubSpot’s users are small to medium size businesses.
The top reasons motivating HubSpot’s users to take the entrepreneurial plunge are as follows (multiple answers were encouraged):
67% Desire More Ownership Of Their Success
Valid – There is no question that an advantage of entrepreneurship is the ability to control you own destiny.
66% Seek More Flexibility
Semi-Valid – One of the biggest challenges of being an entrepreneur is deciding what not to do. Without a boss directing your actions, it’s up to you to filter the constant stream of opportunities, challenges and problems and decide where to focus your time, attention and resources.
Successful entrepreneurs start each day asking themselves, “What is the most important thing I need to accomplish today?” They then ensure that their head does not hit the pillow until that day’s primary tasks are either completed or advanced in a material way.
So yes, you have more flexibility as to when you work as an entrepreneur, but you will likely work longer hours, making work-life balancing more challenging.
53% Driven By Desire For More Money
Semi-Valid – According to a study by Levine and Rubinstein, whether or not you make more money as an entrepreneur than a salaried worker depends on the type of venture you start. Entrepreneurs who incorporate their businesses make, on average, 36% more per hour than their salaried counterparts.
In contrast, people who start an unincorporated business earn 16.5% less than their salaried brethren. Such self-employed people tend to be less educated and have more modest goals than entrepreneurs who incorporate.
47% Believe They Will Be More Successful
Semi-Valid – Well educated, successful salaried people who start their own companies have decent odds of eclipsing their prior success in the startup world.
Those who are relatively unsuccessful as salaried workers are far less likely to more financially successful when self-employed. However, they may be happier, due to the greater autonomy that comes with being your own boss.
44% Have A New/Original Idea
Invalid – As Tracy DiNunzio, Founder and CEO of Tradesy has said, “If you’re doing something, or thinking about doing something, and nobody else in the world is doing it, then there’s a 1% chance that you are a freaking genius and there’s a 99% chance that your idea sucks. If there’s a big market opportunity and something that customers really want, you’re probably not the only person who’s going to think of it.”
An idea and $5 will get you a latte. Ideas alone are worthless, even if it is novel. Execution creates value, not daydreaming about your “unique” idea. (Full Disclosure: I’m a small investor in Tradesy.)
24% Are Inspired By A Successful Entrepreneur They Know
Valid – Seeing startup success first-hand is highly motivational. A critical mass of successful ventures in a geography is a key factor in creating a healthy ecosystem. For instance, people are much more likely to believe that stock options will be valuable in the future, if they have seen people they know experience an outsized financial windfall. Thus, it is easier to recruit employees at a startup that is located in a healthy, vibrant ecosystem as there are local success stories from which they can draw inspiration.
19% Are Inspired By A Famous Entrepreneur
Invalid – It’s reasonable to read about a renowned entrepreneur, in the hopes of learning something that will enhance your own success. However, the official story of famous entrepreneurs usually involves a fair amount of myth making (intentional or otherwise) and seldom gives adequate credit to others who participated in the entrepreneur’s success. Be skeptical when reading about famous entrepreneurs and be careful when attempting to apply the lessons outlined in “heroic journey” biographies.
16% Believe Entrepreneurship Is A Path To Quick Riches
Invalid – As noted above, many entrepreneurs make less money when they are self-employed than when they worked for a salary. In addition, those which are fortunate to sell their businesses for a windfall, usually are overnight sensations, that are years in the making. The time between a company’s founding and its exit has expanded over the past decade. It now takes an average of eight years before successful startups go public and about seven years before they are sold.
You can follow me on Twitter: @johngreathouse.
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