Reasons people don’t start a business
The people who seem to use our site the most – and listen to our show the most – are a mix of people who are either considering becoming an entrepreneur or who are already an entrepreneur, and are looking to grow their business.
Both of these kinds of community members can comment on this question:
Some would say "confusion." Some would say "fear." Others would argue that it’s "intimidation"–a feeling that they simply can’t do it.
Or how about "no money"? Still others would say "laziness."
For those of you who’ve made the leap and those of you who have yet to jump in, what IS the reason that you think most people just never start up at all?
We want to know because we want to break down those common barriers and get people headed in the direction of PROGRESS.
Please help with your perspectives.
February 9th, 2006 at 2:29 pm
I think the main thing holding me back is money, but not simply a lack of start-up capital or financing. It’’s more a problem with concerns about how leaving a secure, well-paying job could impact my ability to meet existing financial commitments.
What happens to mortgage payments, support for aging parents, and bills when the entrepreneur hits a tough period, or simply in the initial start-up period when there’’s negative cash flow? Sure, you can cut down on some discretionary spending, but you always must pay the rent.
February 9th, 2006 at 4:56 pm
Hi,
I have to say I think the reason people kind of give up on starting a business is fear. It all comes down to fear. The excuses that I have made and heard others make all spell out fear. If we could just get past this fear there would be many more successful business”. For me I try to read as many successful business stories about other people everyday… It keeps a person inspired and keeps that gate opening a little wider so you can get through. Thank You for this site guys! -Heidi from California
February 9th, 2006 at 8:06 pm
[b]Hi Jeff & Rich,
I agree with the previous comments, and would add a couple more reasons.
1. Lazy - being an employee is easier and there aren”t that many people who have ambition anymore!!
2. Competition - and how to deal with it. Sometimes people think they have an origianl idea, but then find other similar businesses and are not sure how to define themselves and successfully compete in that market. So they give up!
3. Wish bone instead of back bone! Implementation requires a commitment, wishing requires nothing (that goes for sucessful relationships too). I guess that could be part of the lazy category as well!
4. Shy or reserved personality. People who aren”t "people people" have it harder because of their natural tendancies. I know it is difficult to put yourself ”out there” in front of people to create business relationships when you are timid.
What do you think?
Krista from Olympia
[/b]
February 10th, 2006 at 1:18 pm
Money and fear. They tie together. I”m a bit fearful that I won”t be able to take my idea and turn it into something that will allow me to make significantly more money than what I can make in my existing job. That is something I could get over, but money is the barrier to give it a run. I”m confident I can make it happen, but it could take 2 years to get to the income level where I am now. If I say put, I know that I”ll do well and have a platform to make even more money. I can”t go 1 to 2 years with significantly less income than I have right now.
February 10th, 2006 at 1:59 pm
There are many reasons people easily take their first steps to start business.
- In one’’s natuer/blood, etc.
- Exposed to the entrepeneur spirits from family, friends, work, etc.
- Accidental, by luck, etc.
There are many "reasons" that people don”t take the 1st step. Many books, articles, and blogs have talked about them.
- Personal: fear, lack of confidence, lack of skills (mental or tangible), etc.
- Nature/personal traits: laziness/inertia, risk avertion, etc.
- Situational: personal finance, cost for starting a business, lack of time
But in my opinion, except for the reasons that are situational, all other are just excuses. Starting a business is not for everyone, just like not everyone can be an artist or actor. Most people just don”t have it in them to start a business. In that case, better not to do it and be happy about taking a job.
February 10th, 2006 at 2:19 pm
[black][/black]
The problem we are experiencing in starting our business partnership, is exactly what do we do?
We have the free time on our hands onour present jobs, but the things we want to start, we definitley cannot afford now, so in the mean time, what can we do to work towards the start up capital that we need. So I guess it is lack of money, but also finding a good business idea to work with.
February 10th, 2006 at 2:40 pm
It seems like it would be fairly impossible to start a business when you don”t already know what you can do, what you want to do, or what you need to do?
I am a returning, full-time student, and my husband is working self-employed construction jobs (even though he has two college degrees) that barely pays our bills (basically to put me through school).
We both have absolute ideas of what we want to do in business. And we like to work together. We don”t have good enough credit to get a business loan and don”t have 401K’’s, don”t have credit cards and don”t have a savings account. Still have a car payment, credit card (cut-up) bills, to pay for the next four years. Maybe once I”m out of school and get back to work, we”ll both have time to start building things out of our garage. That’’s probably how we”ll start a business…
But, until we have some monthly capital to buy tools and materials, we”re not in business.
February 10th, 2006 at 2:41 pm
Breaking down the "fear" comments:
1) Lack of confidence. If I truly believed my idea would become successful (make $) then I”d move forward. But you can”t know it unless you try it. I get inspired from time to time and then lose it when I don”t know what the next steps are.
2) Lack of knowledge. I have absolutely no experience in manufacturing, finding supplies, writing a business plan, running a business, etc. etc.
Having someone with experience in it who can help you through all the steps would make a huge difference. SCORE has been great for individual questions. CNN’’s The Turnaround was inspirational (but I think was cancelled).
February 10th, 2006 at 3:03 pm
Jeff and Rich
As a Professional Business and Entrepreneurship Coach what I see is that the biggest reason people don”t start is lack of clarity. First, and most importantly they are not clear what they really want. People often do what they think they want, not what they really want. This causes confusion and often fear.
Second, even if they manage to get clarity about what they really want, they are still not clear about HOW to do it. Some people try to navigate this by figuring out the how, in an attempt to create clarity about what; this is a recipe for disaster. Clarity is essential to getting started.
February 10th, 2006 at 4:29 pm
Entrepreneurs tend to breed entrepreneurs and employees tend to breed employees. In general people raised by "working" parents tend to be very fearful of starting a business, myself included. All my life I heard negative comments when the idea of starting a business would arise. The exact opposite is true of my friends whose families own a business. Their families heartily support thier endeavors and even make introductions to important contacts.
It all boils down to self confidence though. Self confidence comes from building positive experiences one success at a time. Start slow, part time while maintaining a job. Build a moderatly profitable business before taking the leap full time. Outsource or hire staff to handle the daytime business affairs and do the management tasks at night. Especially if you have a lucrative job.
I always wonder what people are thinking when they leave a $100K a year job to do a $20,000 a year clerk or similar low wage job at "their own business". HIRE OTHERS TO WORK FOR YOU and hang onto your secure income…don”t quit the day job until your profits equal what you are giving up!
Planning is extremely important as well. Take the time to prepare a business plan and then stick to the plan! Just knowing where you are going will build tons of self confidence. You wouldn”t just hop in your car and start off on a cross country trip without a roadmap would you? The business plan is your roadmap!
If the business concept does not work out then move on but keep your day job and keep trying. Sooner or later something will click!
February 10th, 2006 at 5:12 pm
loving these comments, folks!
jim, like some of your fellow commentators, you really give a prescription. and i agree with a lot of your points.
i”m excited when i see this kind of contribution to the dialogue because it means you”re willing to take time, be thoughtful, share wisdom, and help others become successful entrepreneurs.
when we launch our community boards in the next month, we”re going to have a rating system as part of it and people like you and many others here will no doubt get high ratings… and you”ll love the perks. among them, every now and then, we”re going to bring highly rated community members on our national radio show to spread even MORE wisdom.
cudos!
keep it comin” everyone!
-rich sloan
February 10th, 2006 at 6:38 pm
My entire accounting practice is devoted to entrepreneurial development. I help prospective new business owners do their research, write business plans and work with lenders to secure financing. When things work out, I help with everything else needed to open doors and then ongoing with tax, etc.
The people I work with generally have an idea of what it is that they want to do and need help fleshing out a plan of action. In my experience, its the ”gut check” that usually kills the process. We”ll work up the numbers and write the plan and then I give them a week of quiet time before we submit anything to the bank or investors. A lot goes on in their heads during that week to say the least. I”ve heard everything you”ve said previously and more.
Usually, its the thought of being saddled with a large debt to get things off the ground and having to put their house up for collateral (just once I”d like a rich client - sigh). Other times, they look at their numbers during the break and start playing ”what if” games in their heads. I had a client that was looking to buy a fast food franchise and he was worried about how something that happens at another franchise could dramatically hurt his business (think the finger in the chili at Wendy’’s and what it did to their local franchisees). Another client was worried about her mother’’s deteriorating health.
Whatever the reason might be - it’’s okay to change your mind. None of my clients who abandoned their effort regrets their decision. Some have rededicated themselves to saving more to try again in the future. Others found new career paths - likely the true reason they started talking to me in the first place.
I would estimate that 1/2 the people I work with never make it past the quiet period. 1/4 actually open doors to their new business and the rest usually have financing or other issues that keep it from happening.
While those numbers might not seem very promising, I should point out that none of the clients I have worked with who”ve opened doors have closed them.
Take care,
Louis
February 10th, 2006 at 7:16 pm
I”ve been attempting to open a store in my area and the reason I haven”t yet is that the leasing agents keep telling me I”ve been approved, then they take forever to get back with me with a lease to sign, only to tell me that the owners are selling the building and I have to wait for approval from the new owners. The new owners wouldn”t even glance at the application until escrow had closed, then they try to tell me that they won”t negotiate on a generic lease that has clauses that can”t possibly apply to this building. I”m not really even sure that the leasing agent has ever spoken to the new owners. She seems to be below the guy who actually has, but I can”t get in touch with him either.
I guess I”m trying to say that frustration is the biggest reason I haven”t opened my doors yet. All this with the location has been going on since May of 2005. If I lived in a larger area I might be able to find another space, but the selection here is scarce. I”ve been keeping my eyes open anyway.
Thanks for letting me sound off.
Jean in So. CA desert
February 10th, 2006 at 8:00 pm
I agree with everything said before me. And I want to equate "fear" with "risk". Or rather, an aversion to risk.
It is the fear of taking risk and putting yourself out there, and it varies with age. As we get older, we have different responsibilities, such as morrgage, children, braces, school funds, etc. There is less appetite for risk as we get older (genrally speaking). I”ve had many ideas over the years, some start-ups, some revenues, but never great success. I still have ideas and some energy, but so much has changed that I”m less likely to strike out on my own.
Wow, I hope that doesn”t sound as pathetic as it reads!
Best regards,
Joe Alcodray
igotissues.com
February 14th, 2006 at 11:16 am
I am an entrepreneur trapped in corporate America! I earn 6 figures+ with my "job" and have amazing benefits. All this has allowed my wife to stay home to raise my kiddos. I thank God for this. However, I am really concerned about the security of my "job" and "smell bad cheese" if you know what I mean. If you don”t know what I mean read "Who Moved my Cheese."
I have tried some businesses in the past - mainly MLM - and am not afraid to take risks. I spent $40k in an MLM and didn”t exactly lose money… it just wasn”t for me.
The biggest fear I have is losing the security of that regular paycheck and cost of benefits.
However, I know what I want to accomplish and I visualize the exact amount of money I intend to acquire with time tables worked out. I have a plan for how I will acquire this money and have started to make it happen.
I have started my business part time and while it is not rolling yet - it will. I won”t stop until it does and then when it does roll I will add to it allowing those I love to roll with me!
Let’’s start it up!!!
February 24th, 2006 at 2:48 pm
Great topic! I see myself in so many of the anwers posted here. But I agree that it all boils down to fear…plain and simple fear.
For instance, one of my excuses is that I do not have enough money to start my own part-time business out of my house; that’’s all that is, an excuse. I know I can start something small with little money, but I am afraid to do so. Why? I don”t know! I just don”t know.
My other excuse is that I need someone to help me with ideas, suggestions, work, etc. Again, that’’s just an excuse. I can outsource most of the work if I believe my idea will work out.
I think the way to break this fear down is to start an inner work, uplifting yourself with enthusiastic words; in time your trust in yourself will raise.
I am still working on myself!
February 24th, 2006 at 4:48 pm
Sometimes vision or not having a vision is the barrier…it is one thing to say, "I want to open a bar."
It’’s another thing to be able "to see" what the actual idea is…the name, the food, the employees, the location…
I think sometimes people attempt to start up and the picture is not complete.
And also, work ethic…a lot of research goes into starting up, and you have to be willing to do that up front work before you dive in.
That is not to say that a business model can”t be adaptable and flexible as time goes on, but there must be a clear vision from the get go.
February 24th, 2006 at 7:51 pm
First - I [red]love[/red] the site and the insight that most of the commentators have. But, I respectfully have to disagree with the "Fear" factor being the main issue for lack of forward progression.
I believe that the issue is actually more along the lines of ppl not being able to give up their "perceived control" over their lives. Most ppl believe that as they sit each week and decide which bill is going to get paid with that weeks salary - they are in control of themselves, their bills, their investments - basically their destiny. Also called our comfort zone.
And, those ppl who are "[i]afraid of not having the $$$ from their employee income[/i]" are actually saying that their current employer is better at providing a salary for them then they themselves are - which seems very convoluted.
Unfortunately the last decade or so has been a very "touchy-feely" time where we have been taught that if it doesn”t feel good - then it ain”t good, so don”t do it……" I think this has stifled many ppl.
It’’s sad but it seems as though in today’’s society we have an awful lot of ppl who are "fearful" and "afraid" of many things and rather than just evaluating those emotions and realizing that a little "anxiety" is actually good, they let it stifle them.
I guess what I really am trying to say - is that ppl need to not be afraid of letting go of their "perceived control" (that they think they have) and make plans to take back control and do what they want to do….. Heck, you can always go out and get another job……
Sorry about being so verbose………
February 25th, 2006 at 12:11 pm
Karen,
Very thought provoking…I had to really sit the notion of "giving up perceived control."
That is such an interesting spin on this discussion because, before I "Started Up", the-petset.com, I worked in corporate America for 20 years. And rarely did I feel has if I had control, quite the opposite.
Now I have so much control with my young business, that I am sleep deprived. (guess I”d better re-read "Life Planning". lol).
But the fear factor for some people is real and this site helps provide some order amidst the internal chaos that we all live with from time to time.
Thanks Start Up Nation!
March 18th, 2006 at 2:58 pm
Hello,
I think start-up requires self confidence, risk taking, and a sense of adventure.
Louis Stone stated (above) that half the people never make it past the "quiet period." How long is the quiet period? Opened my business 4 months ago.
Jim (above) said to hang onto your secure income. I agree. I work 20 hours a week at my job, providing income yet allowing time for marketing.
Adrienne, Certified Legal Nurse Consultant
October 24th, 2006 at 3:16 pm
I would say lack of money and emotional support from family and friends are barriers to starting up one’s own business. I seem to be the only "cheerleader" in my pursuit of being my own boss. Most of my family and friends ask me about how my job hunting is going or that they hope I’ll find a job with good benefits soon. They are all familiar with my entrepreneurial spirit, but it seems like they think the only way to have a job is if you’re employed by someone else. Of course, somebody had to start those companies, too! Sometimes I think that if I could just get the emotional support I need, the money issue would just disappear…
October 24th, 2006 at 8:09 pm
I think fear is real. It encompasses all the other parts of our lives rolled into one emotion (mortgage money, doctor money, food money, car expenses, credit rating, etc.). Sometimes the fear is indicative that it isn’t the right time for you yet, so keep on planning. For me, I have to keep my outside job because I’m trying to adopt my foster daughter. Meanwhile, I’m starting (very, very)slowly and when I get inspiration I do something. Yesterday I signed up for a domain name. It may stay parked for awhile, but I still did it. And then I siged up for a free website and once that site is built I figure I can link the two sites together. While that may seem like a tiny step for most, for me it was huge, especially since I am technologically in the dark ages. The fear is real and I think it is very smart for people to keep their outside source of income until their venture is producing.
May 6th, 2007 at 9:02 am
I agree with part of what Jennifer said. I wish I had support from family and friends. As far as money I will have to go back to work to get money to finance my business idea. All the work I have to do is very intimidating.
May 8th, 2007 at 9:20 am
I think most of the people are pre-programmed that they cant do what already established people achieved. Lack of self-confidence, fear and the unseen future are some other obstacles. You start a business, invest money and time, then what ?? This is the most ciritical and sensitive part. You invest for profit, but it does not show up. What will you do then. To overcome these obstacles, you need a huge courage, a deep faith in yourself and pursue your goal. Whateve comes, let it come. But you continue. That´s the mission of a business. Success is then a matter of ‘today or tomorrow’. Believe me.
June 7th, 2007 at 1:01 pm
The reasons that hinder most people from starting a business is definitely fear and lack of ambition. I convict myself of both. I am going to overcome these obstacles and start out part-time first.
Wish me luck
js
February 7th, 2009 at 3:52 am
Before I started my business at 22, I thought that it was difficult to get started. I thought I had to be incorporated to do business. I was convinced that I was too young to start a business and be successful. Such is the case with most people.
Being aware of what you don’t know gives you room to quickly make changes. But for a lot of people - startup is an unknown-unknown. They don’t know what they don’t know about starting, running and growing a business. And its the fear of the unknown-unknown that stops many potential startups in the conception stage.
March 22nd, 2011 at 9:07 pm
Money is one of the biggest reasons. Many entrepreneurs didn’t use conventional loans to get started but instead they maxed credit cards or used home equity loans to start up their business. Those channels have dried up. If you’re ok with high costs one could use their 401k to buy a business but that’s not recommended.