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10 Reasons For Joining The New Startup Wave Now

Posted on the 19 July 2015 by Martin Zwilling @StartupPro

entrepreneur-startup-wave Since the recession, and at least partially sparked by it, I’m seeing a real resurgence of entrepreneurial spirit, and more startup activity than ever before. I believe the days of the “job work” mentality are thankfully waning, with more people looking to get satisfaction by making the world a better place, rather than just tolerating brain-numbing work to fund enjoyment elsewhere.

According to the latest Kaufman Startup Activity Index, entrepreneurs are making an unprecedented comeback in America, with data showing the largest year-over-year increase in two decades. The rate of new entrepreneurs increased about 10 percent, from 280 out of 100,000 adults in the 2014 Startup Activity Index, to 310 out of 100,000 adults in the 2015 Index.

There is additional encouraging news for aspiring entrepreneurs on many fronts, just in case you are thinking about joining the existing ranks:

  1. Valuations of successful startups have hit an all-time high. An unprecedented number of startups, over 100 at last count, are now valued above $1 billion, according to a recent Wall Street Journal article. Two of these, Uber and Xiaomi, are already above $40 billion. Thus a record number of entrepreneurs (and employees) are getting rich.

  2. Initial Public Offerings (IPO) are back as an exit strategy. Last year was the most active year for IPOs in the United States since 2000. 275 IPOs were completed in 2014, topping the 2013 total of 222 by more than 23%. Total U.S. IPO proceeds also shattered 2013’s high-water mark of $55 billion, with an impressive $85 billion in proceeds.

  3. Funding for early-stage startups is more available than ever. According to Statistic Brain, angel investors, numbering almost 300,000, contributed a record $25 billion to early-stage startups in the U.S. in 2014. With more startups, angels still limit their focus to about one out of 40 requests. No wonder 90% of the successful startups still bootstrap.

  4. Cost of entry for a startup is at an all-time low. I can remember when creating a web site for eCommerce could easily require a million dollar investment. Now you can create a web site for almost nothing - and be on your way with your latest invention or personal services. Smartphone apps can be built for less than $10K, so who needs an investor?

  5. Startup incubators and accelerators are popping up everywhere. Business incubators were all the rage before the dot-com bubble (700 for profit, many more non-profit). After the bubble burst and the recession, more than 80% of them disappeared. Now they are back in every community, with the best even waving money at graduates.

  6. The world is a now single market, both homogeneous and heterogeneous. Entrepreneurs now can think globally about the opportunity, from day one but start locally. This approach, popularly known as “glocalization,” means you design and deliver global solutions that have total relevance to every local market you plan to attack.

  7. Social media is a boon for entrepreneurs and startups. With the key social media platforms today, an entrepreneur can tune a product, build a brand, and grow the business with very low cost and a high interactivity never before possible. The elements include communications, mobile platforms, and location-based services.

  8. Large corporations have lost their ability to innovate. Conglomerates, which were the engines of growth and vitality in the twentieth century, have proven themselves unable to innovate, and have a tarnished public image due to financial woes and poor management. Most now routinely buy startups for new technology and new products.

  9. Women are a growing force as entrepreneurs. According to Fox Business, women-owned businesses have increased 68% since 1997, running more than 9.1 million businesses in 2014. Women inherently should have an advantage, since women already control over 70% of household income and $20 trillion of consumer spending.

  10. Baby Boomers are joining the fun in record numbers. The number of entrepreneurs who are Baby Boomer starting a business has grown from 14 percent in 1996 to over 30 percent last year. In fact, in every one of the last 15 years, Boomers between the ages of 55 and 64 have had a higher rate of entrepreneurial activity than Gen-Y.

Looking ahead, the National Venture Capital Association (NVCA) predicts that 2015 will bring further good news for entrepreneurs across several fronts, including more investment, greater IPO volume for exits, greater employment opportunities at startups, and even more improvements in the economy.


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