President/CEO of Joseph’s Premier Real Estate; professor of finance, business, real estate at IRSC; author of Madness, Miracles, Millions.
It has never been more challenging to be an entrepreneur. Due to public-health considerations, the Covid-19 pandemic has required America’s small businesses to prioritize important mandates and guidelines, from mandatory mask-wearing and capacity limits to closures.
Economic uncertainty is also the status quo for the foreseeable future. With the U.S. seeing thousands of new Covid-19 cases each day and Europe locking down, business expansion and job creation are subject to the presence of the virus and the varied response of public officials.
Nevertheless, the American spirit is resilient. Entrepreneurs are continuing to innovate and take risks. Even as the pandemic has shuttered hundreds of thousands of small businesses, millions of Americans are deciding to live their dreams and go out on their own, according to The Wall Street Journal (registration required). “Applications for the employer identification numbers that entrepreneurs need to start a business have passed 3.2 million so far this year,” The Wall Street Journal reported. In 2019, that number was only 2.7 million.
So, during a pandemic, should you take the plunge and become an entrepreneur?
I believe your answer to this question depends on your mindset. If entrepreneurship is a fleeting thought, it might not be the right career choice for you. The small-business lifestyle is 24/7. It will consume your life, not only in terms of execution, but also by way of planning. The more time you invest in the planning phase — such as deciding on a unique value add, identifying competitors and preparing for potential threats — the more likely you are to succeed. If you’re not ready to give your life to entrepreneurship, a traditional career path might be a more responsible option.
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However, if you are ready to go all-in, entrepreneurship has the potential to be the best decision you’ve ever made. As a longtime small-business owner myself, I understand the risks of entrepreneurship. But those risks never dissuaded me from reaping the rewards. I went all-in because I wanted to provide value for my loyal customers; I wanted to control my own destiny; I wanted to work on my own terms; I wanted to live my dream and not anyone else’s.
From my perspective, that basic human need for individual agency does not go away because of a pandemic or the subsequent recession. It still matters. And, if it’s truly important to you, it should matter enough to try.
There are challenges to consider.
Of course, there are internal and external challenges you need to consider before taking the leap. Planning and execution, for example, can be challenging. You might fail — and fail again.
In addition to economic uncertainty, I’ve found the retention of long-term workers to be perhaps the most difficult proposition for entrepreneurs to overcome. Unless you’re a sole proprietor, the recruitment, hiring and cultivation of long-term talent can be the difference between success and failure for a small business owner.
Taking care of your team is essential to your success.
In my experience, talent is everything. After all, you can’t run a business completely alone, so delegation becomes paramount. You must be able to delegate to the right people who are invested enough in your small business to go the extra mile.
With that in mind, today’s entrepreneurs need to take care of their employees like never before. Retaining long-term talent means treating your team exceptionally well. Offer opportunities for not only financial security but also career advancement and fulfillment on the job. Upward mobility needs to be a reality, not just rhetoric.
Then, there are benefits to keep in mind. In 2020, healthcare is a top priority. If at all possible, I encourage employers to provide health insurance for their employees, therefore securing their finances and their well-being.
Long-term security is also important, given the ebbs and flows of the pandemic economy. Again, if possible, consider offering retirement plans for your team members. This allows employees to invest in their futures while also showing how much you care about that future.
I also recommend educating employees about the benefits available to them. For example, I used to provide employees with 300% matching on their 401(k) plans. While some employees didn’t understand the value of retirement planning at first (and preferred raises instead), I explained the benefits of putting money away tax-deferred. Don’t get me wrong: I have given out plenty of raises, too, but team members might need to be educated about accumulating long-term wealth through retirement plans. Again, this is where employers can show that they care.
So, should you start that small business? If you’re ready to make it your life’s work, take care of your team and be the best employer you can possibly be, I believe that answer just might be yes.