*Editor’s Note: CC Biz Buzz is a monthly column series that features insightful commentary from a member of the Columbia College Robert W. Plaster School of Business faculty.
Entrepreneurship is not just for business students! The traits of entrepreneurs are ones that can be helpful to individuals in any field. With 98% of total U.S. firms having fewer than 20 employees, the reality is many people will work for a small organization, whether their own or someone else’s.
It is not uncommon for human services graduates to operate their own home health care company and psychology students to offer counseling services, or someone who has studied criminal justice may launch a security firm. Knowing the business end of those endeavors will help them to mitigate the risk of failure.
According to the Small Business Administration Office of Advocacy 2020 FAQ publication, one-third of new businesses fail in their first two years of business, and only about half survive more than five years. The number of new startups that survive 10 years or more drop to 33%. Improving the odds for success is clearly important. Per the Kauffman Foundation Firm Survey, the average cost to start a business is $31,250. Factoring in the average starting salary for a new college graduate of $54,000, the decision for an untrained college graduate turned entrepreneur to open their own business, could result in an $85,000 loss in one year alone! For each year beyond that they risk the $54,000 salary they could be making plus any additional operating expenses as it is very common for entrepreneurs to avoid drawing a paycheck as they establish their business.
Training in the area of business can help to reduce these numbers. Researching your market and knowing your industry is vital to launching a successful new initiative, and knowing how to run a business is important too. I’m frequently asked what courses would be most helpful if a student doesn’t pursue a business degree but wants an understanding of business. My short answer is “all of them.” I realize this is not practical for many students, so based on my personal experience as a founder, here is my must-do list: Management classes especially studying entrepreneurship, small business management, and human resource management. Business finance, financial accounting and marketing are others I found to be vital for my startup success. Narrowing down a list to six classes is difficult (you could not go wrong with business law, ethics, and communications classes too) and I imagine there could be a great debate with other entrepreneurs and academics if this is the right list. But, that is a solid start.
Aside from the knowledge base, a support network will help too. Columbia College’s Fishman Center for Entrepreneurship is one of those resources, and should be the first stop for Columbia College students as we can help them get connected. Faculty members, deans, and academic advisors are also important touchpoints. Aside from college connections, in most cities there is a system established to help aspiring founders. Look for your local 1 Million Cups group to meet helpers, get advice, and make important contacts. Check in with your local Chamber of Commerce or economic development group for services available to community members. Join social media groups or ask about groups in your area that meet formally, or informally. Go into other businesses that you frequent and introduce yourself. Entrepreneurs are some of the most generous people I’ve known and usually will take time to talk with you. One caveat: If they are in the same business as you, look outside your hometown for that connection. If you have family in another city, ask them for an introduction to small business owners they know.
Just as you must be brave to open your own business, you also must be fierce in your pursuit of knowledge and mentors or friends that will lend to your ultimate success. If you are considering starting up your own new venture, drop me an e-mail at email@example.com. I will be happy to discuss your opportunities with you, and help you connect!
Becky Bocklage serves as director of Columbia College’s Fishman Center for Entrepreneurship.