Any small-business owner will tell you that entrepreneurship is difficult, especially when competing against larger companies.
Easing the burden on entrepreneurs is essential to becoming and remaining competitive. But how do you do that?
The Burden on Entrepreneurs
Startups fail—they just do. Getting a startup off the ground is a feat in and of itself. Keeping that startup in the air is another feat. Combined, they take a professional and also personal toll on entrepreneurs.
First there’s the effort of running a business. Most small business owners wear a number of hats, and they get pulled in multiple directions all the time.
On any given weekday, a small business owner can start the morning with a set of tasks for that day. Then they get yanked around and don’t get a single one of them done. Sound familiar?
Running in sand slows the process of moving the business forward. It also wastes energy. Small business owners need energy in abundance, and no one has an unlimited supply.
Then there’s the stress of running a business. Entrepreneurs are betting their livelihood, their personal relationships, their health and their happiness on their businesses.
It’s extremely stressful to run a small business. Many are operating on a knife’s edge between success and failure, and their owners are suffering because of it.
We idolize the Mark Zuckerbergs and the Elon Musks, and we celebrate the blazingly fast growth of the Inc. 500 companies. But many of those entrepreneurs…before they made it big…struggled through moments of near-debilitating anxiety and despair—times when it seemed everything might crumble.
…Toby Thomas, CEO of EnSite Solutions (No. 188 on the Inc. 500), explains the phenomenon with his favorite analogy: a man riding a lion. “People look at him and think, ‘This guy’s really got it together! He’s brave!’” says Thomas. “And the man riding the lion is thinking, ‘How the hell did I get on a lion, and how do I keep from getting eaten?’”
… Entrepreneurs often juggle many roles and face countless setbacks—lost customers, disputes with partners, increased competition, staffing problems—all while struggling to make payroll. “There are traumatic events all the way along the line,” says psychiatrist and former entrepreneur Michael A. Freeman, who is researching mental health and entrepreneurship.
Startup Accelerators Are Proliferating
While the number of startups in general is on the decline, the number of organizations dedicated to helping startups grow is on the rise.
Over the last 30 years or so, the rate at which Americans are launching new businesses has fallen.
The reasons behind the decline are many and varied. They range from mounting student debt to the rise of big chains to increased research and development at big corporations.
Meanwhile, the number of supportive entities has grown over the last decade or so, particularly startup accelerators. In the early 2000s, there were about a dozen startup accelerators; today, there are around 170.
Supportive entities for startups include incubators, angel investors, accelerators and hybrids of all three.
Generally, incubators tend to offer leasing of workspace, some mentoring and connections to other startups, the local community and possibly investors. Angel investors tend to offer funding. Accelerators tend to offer investment, some education and more intense mentorship.
Of these three types of startup-support entities, accelerators are the new kids on the block. They’re also the most promising.
Accelerators may offer the most benefit through their concentrated mentorship programs, which accelerate the learning curve for startup operators (e.g., refining products or services and identifying promising markets), as well as their ability to attract investors.
Accelerators have clearly taken hold in recent years. But what is it about what accelerators do that makes them so different from other early stage investors and support organizations and so valuable to the startups that are apparently falling over each other to be in their ranks?
I recently posed this question to Brad Feld, a cofounder of TechStars, and he likened the accelerator experience to immersive education, where a period of intense, focused attention provides company founders an opportunity to learn at a rapid pace. Learning-by-doing is vital to the process of scaling ventures, and the point of accelerators, suggests Feld and others, is to accelerate that process. In this way, founders compress years’ worth of learning into a period of a few months.
Business Services Help
Startup accelerators help small-business owners with the sharp learning curve of running a business. Companies that offer business services can do the same, but they continue to help throughout the life of the business.
Widget makers are experts at making widgets. They’re well versed in widget theory and widget craftsmanship and everything else related to widgets. That’s their skillset.
However, running a business requires an entirely different skillset. Actually, it requires multiple skillsets.
For example, managing is entirely separate from core job responsibilities. Managers have to perform their core job functions and also the separate job of managing the employees under them.
Small-business owners have to fulfill the role of widget expert but also the roles of employee manager, bookkeeper, accountant, payroll manager, human resources staff, et cetera.
And they have to do that all at the same time, which is too much. It’s a main reason why many businesses fail—one mistake in accounting, for instance, can create financial, tax and even legal trouble from which a small business can’t recover.
Companies that offer business services can handle the administrative side of running a business so that the business owner can do his or her work. They also ensure that the administrative work gets done correctly, saving startups from unnecessary headaches, financial missteps and even legal trouble.
Easing the Burden on Entrepreneurs
Launching and succeeding with a small business is a monumental feat that requires a high level of energy and optimism. Entrepreneurs undergo tremendous workloads and stress.
Easing the burden on entrepreneurs is essential to making any small business thrive. Thankfully, there are organizations that do just that—lightening the load on entrepreneurs’ shoulders.