S/O poll Starting a small business

[amy g.]

I'm curious how many of us and our family members have started successful businesses in spite of coming from humble backgrounds.

 

I've posted a poll before. I hope I'm up to it.

 

Not too bad for a first attempt, but stupid autocorrect messed up my title.

Edited April 29, 2012 by amy g.

[MrsBear]

In my life, I've started 5, sold 3; one failed, three grew to the point where selling made sense, one I still keep idling, no income for it, but it's there when I'm ready to resume doing something outside the house (SAHM).

 

Since 15, there have been only three times I worked for someone else as an employee, and two of those was for about a year and were to gain experience I needed, one was for three years to pay my way through college while working full-time. My dad was blue-collar, mom SAH, and while we were middle class, we weren't, by any stretch of the imagination, wealthy. We lived in a very rural community about an hour outside NYC. My parents didn't pay for my education, nor did they fund any of my business ventures.

 

DH has his own practice; he grew up poor in NYC, dad a teacher, mom SAH; they too didn't have the money to send him to college, let alone finance his opening an office. He's worked in both academic and private practice before buying the practice he has now, financed with our savings and loans, purchased when the doc he worked for retired.

 

In my family, about 30% of the family (aunts, uncles, cousins) owns and operates their own businesses; some would call us outliers, but I think it's really more the culture of our family dynamic that expresses as entrepreneurship - none of these businesses were started by family funding them. Even now, the younger generation is repeating, yet no one is jumping to give them money to start, probably because we understand why it's important (to us) that they figure it out for themselves.

 

DH's family, only one cousin of his owns his own business too; he was working for a company and the owners were retiring, he bought it with another employee in partnership and has grown it and is now in a position to sell it to a bigger company, which he and his partner are seriously considering as his partner wants to retire now too, he's trying to decide what he'll do next before they sell. No one financed his cousin to buy the company, he and his partner did that on their own, with savings and loans.

[m0mmaBuck]

DH and I have a small IT company that we started on our own. In some years it has done very well and in others it has limped along (economy related). We have never had any help from anyone else.

[sassenach]

I have never started a company, because 1) I have no desire to, and 2) my dad owned several small businesses and there was nothing about the experience of growing up in a small business owning family that made it look appealing.

[Jane in NC]

May I ask how you define "successful"? I know a number of people who have small side businesses operated from home. For example, for a small sum, one can sell Tupperware, Discovery Toys, Pampered Chef, etc. But most of the people I know who have done this have used the business to fund their own purchases and maybe get some pocket money. But they could not begin to support their families.

 

I know people a guy who does computer repairs from home and another who strips old computers for parts which he sells on Ebay. Both are successful "small" businesses but both guys have a corporate job with benefits--and they are not quitting those jobs anytime soon.

 

I am all for entrepreneurship! In fact, I have a bit of Kickstarter habit. I chip in regularly to help people with seed money to get ideas off the ground. And I give my money to local businesses to support them. But I think that creating what I view as a "successful" business (one that supports a family and possibly others) is not terribly common. Many of the local small businesses that are successful near me usually do come with family money--parents, grandparents, spouses with solid professions.

 

About IT companies: I have a friend whose eighteen year old son devised a product and created a very successful company. But a family member who did the same fell victim to the last recession. Maybe timing is everything?

[DawnM]

I am not sure what you mean by "come from money." We were never in need or in debt, but we were not what most would define in the USA as "rich" either. We lived within our means.

 

I have never, ever, ever had a desire to start a business. It gives me hives just thinking about it.

 

But the only option was the "I came from money and never started a business" so that is what I chose.

[chepyl]

We own two small businesses, we started one on our own amd the other we started with family and our initial investment came from money my grandmother left me.

 

The firay business cost less than $50 to get started. The investment in the other was only $3000. The $50 startup has had bigger payoff so far, but we are getting there.

[MrsBear]

But I think that creating what I view as a "successful" business (one that supports a family and possibly others) is not terribly common.

 

Small businesses are the engine of our economy. As I noted on another thread, more than half the US GDP is from small businesses (<500 employees) and accounts for more than half the employment in the US. Companies with less than 20 employees account for 20% of all US employment, if you look at the data, half of small companies employ less than 100 employees; 9-million of them in the US, employing 45-million people.

[Jane in NC]

Small businesses are the engine of our economy. As I noted on another thread, more than half the US GDP is from small businesses (<500 employees) and accounts for more than half the employment in the US. Companies with less than 20 employees account for 20% of all US employment, if you look at the data, half of small companies employ less than 100 employees; 9-million of them in the US, employing 45-million people.

 

A study from Hurst and Pugsley of the University of Chicago challenges the myth that small businesses are the "engine" of the economy. Link.

 

A tidbit from the link:

If you’re looking for a lot of good-paying, stable jobs, you’d better hope there are some big companies around that want to hire. Kansas City Federal Reserve economist Kelly D. Edmiston’s analysis of U.S. data found that each year, 22 percent of staff in companies with fewer than 100 employees quit or are fired, compared with only 8 percent for companies with 2,000 or more workers. Edmiston also found that the jobs offered at large businesses were better than those at small businesses. Hourly wages at the largest companies, those with more than 2,500 employees, average around $27, compared with $16 in companies with payrolls of fewer than 100. Companies with more than 100 workers are almost twice as likely to offer retirement benefits and insurance, and considerably more likely to offer health care.

 

As I noted, I am all for entrepreneurship. To return to a question that I raised in this thread, what does it mean to be successful? Hurst and Pugsley found that most small business owners did not create their businesses to become tycoons but for freedom and flexibility. That is one definition of success in my book. But I think that some people equate success with wealth.

[Carrie12345]

My uncle started his own small business on his own. Now he's a millionaire.

 

We would like to start a small business. We could probably even get that uncle to help. But we don't want to go that route.

 

Unless something big happens, no small business for us!

[GingerPoppy]

I work for myself (service-based small business). I do it mainly because I love the flexibility, and I enjoy the autonomy. I love using my own creativity and skills to propel things forward. I am very much a make-your-own-path kind of person, and I think I'd wither elsewhere. Yes, I could make more money in a standard teaching job, but then I would have to give up a lot--like homeschooling.

[chepyl]

A study from Hurst and Pugsley of the University of Chicago challenges the myth that small businesses are the "engine" of the economy. Link.

 

A tidbit from the link:

 

 

As I noted, I am all for entrepreneurship. To return to a question that I raised in this thread, what does it mean to be successful? Hurst and Pugsley found that most small business owners did not create their businesses to become tycoons but for freedom and flexibility. That is one definition of success in my book. But I think that some people equate success with wealth.

 

 

My husband has complete flexibility and control of his schedule. No paid vacation, but between the two businesses, we pay our bills and live nicely, in two days, one will even start providing health insurance! It is a lot of work amd sometimes a lot of stress, but it is worth it not to have to deal with an employer.

 

We are successful because we live on our businesses, they continue to grow, and most of all...the flexibility! No, we aren't wealthy, but we have what we need and a little of what we want.

[justamouse]

I would define us as successful, but what do you define as help?

[edelweiss]

DH started up his own business about 6 years ago. He has no help from family members. We both come from very humble roots.

 

The business has done, and continues to do, fabulously well. DH loves being the captain of his own ship and would never want to work for anyone else again. I, also, feel much more secure now that he works for himself.

 

Both of our families are a bit overwhelmed by our change in circumstance (although my family has also witnessed the same situation with my sister and her husband), but they are thrilled at how much we have improved upon our beginnings.

[SKL]

I've started a few (and I come from very humble means). The first official one was when I was 19 and started a used book store. Mostly I have co-founded with a relative or friend, but the other person also had no money. I'm just not a person with enough confidence on my own to sell my ideas, so I partner with people who have those complementing skills.

 

Right now my full-time job is as a partner in the small business I started with a friend on $0 about 20 years ago. It did not make any serious money for a long time - just enough to pay for itself and feed at least one of us. (I always had a full-time "traditional" job through 2007.) We went into all kinds of mini-ventures, some which flopped, some which were successful only in the short run, and some which have lasted. At one point we bought an operating factory, shored up the business's weak areas, and sold it for 100% profit a year later. In the past few years, we've generated enough to buy a good-sized building for cash and rehab it (mostly for cash from our business) and now we're hoping that cash flows fairly soon.

 

We're successful in the sense that we're doing what we want without a lot of debt and heartache. It's been an interesting ride for sure - not all flowers and sunshine - but not regrettable. We still live very frugally because we put cash back into the business. None of us are interested in money for money's sake. For me, just being secure that my kids won't starve is enough.

[Mrs Mungo]

My mom's dad started a plumbing business with his brother-in-law. I think they used money they had from selling their farms (which, they had also purchased on their own). My dad's mom owned a flower shop, but she started that business when she was older; it was her job after my dad's dad retired from the IRS.