The business landscape in the United States and around the world is once again changing. As more and more people look to become their own bosses and benefit from self-employment, they must also consider trends affecting businesses across all sectors and industries.
In this guide, we’ll look at small business statistics, discuss the state of business through 2023, and highlight key trends to look for to keep your business on the cutting edge. If you don’t have a startup yet but are interested in becoming a small business owner, our results can shed light on how to get started on the entrepreneurial path. For more information, read on.
Entrepreneurship and startup statistics
With the new year comes new business statistics. Entrepreneurs will register nearly 5.5 million new businesses in the United States in 2022. In total, about 31 million Americans are self-employed, or 16 percent of the adult workforce. We evaluate these entrepreneurs and highlight differences in gender, race/ethnicity, and age. We then discuss the most profitable industries for entrepreneurs, financing strategies, the most important factors for startup success, and more.
Demographic data
At the time of this study, American entrepreneurs were more likely to be male than female. According to the latest data, more than half (59%) of all American entrepreneurs were men. By race or ethnicity, whites made up 71% of America’s entrepreneurial workforce, followed by Hispanics/Latinos (14%), Blacks/African Americans (6%), and Asians (6%). Since 2010, the number of white entrepreneurs has decreased slightly, while there has been a slight increase in Hispanic and Latino entrepreneurs.
Broken down by age group, more than half of American entrepreneurs (63%) were over 40 years old. The remaining 37% were millennials or younger generations.On average, the oldest entrepreneur groups were black or African American men at 46 years old and Native American or Alaska Native women at 48.5 years old. Both male and female Hispanic/Latino entrepreneurs were the youngest on average (40).
In reality, there is no right age to be your own boss. Younger small business owners may be more tech-savvy and less risk-averse, but older entrepreneurs tend to be more experienced and have more connections and capital.
Popular industries for entrepreneurs
Whether you’re in your 20s or 40s, some industries have a better chance of helping you start a new business than others. Consider the following growing industries (and their overall growth) if you want to be your own boss now:
Tourism/guest divorce: 201%
Mass media: 198%
Energy: 174%
Safety: 171%
Real Estate: 168%
American entrepreneurs can benefit from a variety of viable business services in these areas to get the ball rolling and ultimately establish themselves as successful small business owners. Starting a new business in Texas or Florida can be especially advantageous because they are the top states for the fastest-growing businesses in the country.
The most common causes of why startup fail?
Becoming a small business owner is difficult, but it may not be as difficult as you think. While 20% of new businesses in the US fail in the first year, 50% are still operating five years later!
More than a third of startups didn’t hit their product market well, dooming them from the start. Marketing, team, financial, technical, operational, and legal issues also plagued small business owners, accounting for up to 22% of startup failures.
The best countries to start a business
Starting a new business globally outside of corporate America can also be a smart career choice. Consider starting your own business:
Singapore
It is a small country with desirable opportunities for self-employment. A small population, a low crime rate, a strong economy, and low tax rates are just a few reasons why starting a business here is an attractive option for entrepreneurs everywhere.
Swedish
Similar to Singapore, the low crime rate and safe banking regulations make it an excellent destination for new international business ventures. Home to high-profile tech companies like Spotify, the country generally has a rich history of innovation.
New Zealand
Their economy is among the top ten in the world, and the country has flexible labor laws. The country has a high standard of living and relatively low costs, making it a great place to explore business.
Small Business Financing Strategies
To be a successful small business owner, you need to get your finances in order. According to a recent study, two-thirds of entrepreneurs used personal funds to launch their new business, while others relied on additional sources to get their start. Here is a list of the financing options that entrepreneurs rely on to give their businesses a fighting chance (from most used to least used):
Income earned from other work
- Gifts from friends and relatives
- bank loans
- Cash advances from credit cards
- Investors
- Grants
- Crowdfunding
Since it costs a little over $100,000 to start a business, entrepreneurs need to get themselves the funds they need to achieve a healthy cash flow as quickly as possible.
Money is important.
The median annual salary for an entrepreneur in the United States is $70,849, but the top 10 percent earn more than $118,000 a year. Certain factors, such as location, can have a significant impact on a startup’s financial success (New York entrepreneurs earn the most, while Hawaii startups earn the least). University degrees can also make a difference; the average salary of an entrepreneur with a master’s degree is usually higher than someone with only a bachelor’s or high school education.
The most popular Entrepreneurship trends of 2023
Technological advances continue to shape our world, and business owners must keep up with them to ensure the highest quality business services. For example, entrepreneurs who sell products online must invest in profitable business applications such as e-commerce and email marketing software to properly perform their small business management tasks. Additionally, as artificial intelligence and virtual worlds become more and more present in our lives, entrepreneurs must quickly understand their roles and their benefits.
Emphasizing employee relations, incorporating sustainability practices, combating inflation and economic uncertainty, and incorporating video content into marketing are also trends in 2023. All entrepreneurs can benefit from understanding current and forecast business trends, from Generation Z to Baby Boomers.
