A major shift is underway in the labor force. And if you haven’t made the transition already, chances are 50/50 that you will do so in the next few years. What are we talking about? Becoming an entrepreneur.
The Kauffman Foundation reports that half of all adults and over 70% of college students say they want to become entrepreneurs. And Statista estimates that by 2027, 86.5 million people will be freelancing in the U.S., an amazing 50.9% of the total U.S. workforce.
Do you have that big idea just waiting to be turned into a reality? Do you have that entrepreneurial itch that you just can’t seem to shake off? Do you KNOW you have what it takes to be successful, and you would have already started your business if [INSERT LAUNDRY LIST OF EXCUSES HERE: ___________ ]?
So, WHEN is the right time for YOU to take that leap of faith to go from a “WANTrepreneur” to an “Entrepreneur”?
Well, the truth is, if the answer was that easy to come by or if the steps to take were the same for everyone, there wouldn’t be countless other blogs and articles on this same topic. In reality, the formula for finding the right answer to “when is the right time to become an entrepreneur?” is right up there with finding the answer to “when is the right time to break up with someone?” or “when is the right time to start a family?” There’s rarely ever a “right time” to take on all the risks involved with becoming an entrepreneur. Be like Nike and “Just do it.” However, there are certain circumstances to consider that may make the timing more favorable than others.
When is a favorable time?
- When life pushes you into it, face-first
“Now is just as good a time as any.” During the initial quarantine shutdown for the COVID-19 pandemic, data from the Census Bureau shows new business applications skyrocketed in the first three quarters of 2020, passing 3.2 million compared with 2.7 million in 2019. In 2021, The Wall Street Journal reported that Americans are starting new businesses at the fastest rate in over a decade and choosing to become solopreneurs in increasing numbers.
Why did so many new businesses start up during the pandemic? There’s an infinite number of variables and factors that make up each individual situation. But whether it was due to loss of employment, for financial reasons, because people finally had the time to start a new craft or perfect an existing one, or for any other reason, including just plain boredom, the COVID-19 pandemic pushed a lot of people, face-first, into entrepreneurship.
The pandemic is just one example of life circumstances that can leave one feeling that it’s “now or never”. When you are at that crossroad in life – and believe me, you’ll know you’re there when life smacks you in the head with it – you’ll have a choice to make. Like in The Matrix, you can choose between the blue pill or the red pill. With one, you continue about your life as is. With the other … well, you might want to buckle up!
- When YOU can no longer afford not to
This can be taken two ways: When there is an external demand for your product/service or when there is an insatiable internal demand from the fire your soul. For some, especially those who have been in the rat race and mastered a skillset that they know they could build a business around, it’s the entrepreneurial itch that gets so intense you just have to jump out of your current skin and run naked and exposed into the world to satisfy that entrepreneurial urge. For others, their craft, product, service, talent, or hobby, that they occasionally shared with or sold to friends and family, become so popular and in-demand that you can no longer afford to keep it as just a hobby.
In other words, when you can no longer afford to NOT take that leap of faith to formalize a business, and when the risks of betting on yourself and your craft seem less severe than the risk of not pursuing your passion at all, it may be time to make the jump.
- When preparation and opportunity align
While it is true that entrepreneurs are starting younger and younger, according to findings from The National Bureau of Economic Research, the average entrepreneur is 40 years old, and the average age of leaders of high-growth startups is 45 years old.
Regardless of who you are, where you are from, or how you were raised, wisdom, experience, perspective, and being skilled or practiced are just some of the attributes that one gains by the time they reach their 40s. And many professionals in their 40s have amassed the resources or the skills and relationships to obtain the resources necessary to start their entrepreneurial journey.
If you have prepared yourself, through mastering a skill, through savings, or through the network of relationships you’ve built, and suddenly an opportunity presents itself to you to make the leap into entrepreneurship, it may be a favorable time to put that preparation into action.
Conversely, and what you may want to weigh the 3 points listed above against, there are certainly scenarios that would tell you now may NOT be the right time to make the jump into entrepreneurship.
When is NOT the right time?
- When it would irresponsibly or recklessly jeopardize the well-being of loved ones
Entrepreneurship comes with a LOT of risk. Being an entrepreneur will undoubtedly thicken your skin as you may take countless hits and failures before you start figuring out the secret formula of what does and doesn’t work. And unfortunately, many never survive long enough in business to figure out formula.
Data from the Bureau of Labor Statistics shows that approximately 20% of new businesses fail during the first two years of being open, 45% during the first five years, and 65% during the first 10 years. Only 25% of new businesses make it to 15 years or more.
When all of this risk and the repercussions of your business decisions affect you and only you, that’s one thing. But if there are people who rely on you to provide for them, such as kids, elderly parents, or sick family members, failing them may cause irreparable harm. That’s not to say you shouldn’t take the leap if you know you can make it. But it is important to weigh all the risks, as well as who is affected by those risks if things don’t go the way you planned in your business … and let me tell you, things never go the way you planned in business.
- When you are not passionate about the product/service you are selling
Entrepreneurship is hard and businesses can fall on hard times. Take the pandemic for example. To survive as an entrepreneur, you must be willing to fight for your business, to defend its honor, and to let your conviction do the selling. It’s really quite simple. If you don’t believe YOUR product or service can add value or make a positive difference in the lives of your customers, your customers won’t believe it can either.
It may feel like the right time for YOU to become an entrepreneur. But if you aren’t 100% sold on what product or service you are going to build your business around and go to war for, day and night, it may be best to do more research and preparation on identifying a product or service you know you will go to war for, before you make the transition to entrepreneurship.
- When you are after the false reality of what it means to be an “entrepreneur”
The other red flag in entrepreneurship is when one makes the leap of faith without REALLY knowing what it takes to be an entrepreneur. We all know what we want to get out of entrepreneurship. Whether your aspiration is to be rubbing shoulders with A-list celebrities in the limelight or simply to provide for yourself or your family, it’s great to visualize your end-goals. But that part of entrepreneurship is sadly a minuscule portion of what it means to be an entrepreneur.
Merriam-Webster defines an “entrepreneur” as “: one who organizes, manages, and assumes the risks of a business or enterprise”. In what part of that definition does it promise you the big house and fancy cars? Nowhere.
The other often forgotten and arguably the most important part of the equation to being an entrepreneur is that you will first need to work backwards from that lavish end goal vision and identify the steps necessary to accomplish that vision … and then, you will need to DO THE WORK required to achieve that goal. And at the end of the day, even if you recognize the hard work and do everything right, you still might fail.
If you are not aware of or not able to stomach the risk, this may not be a favorable time to make that leap.
Sooo, what does this all mean? Well, it means that even with these considerations in mind, YOUR entrepreneurial journey will be like no other, because everyone and every business is different. That said, while the details and names in each entrepreneur’s journey may differ, there are a lot of common themes, experiences, emotions, challenges, and decisions in every entrepreneur’s journey that we can all learn and take tips from. If you don’t know where you fall on the list, above, or if you do know where you fall but still need some answers, do your homework and ask other entrepreneurs and business owners!
At the end of the day, only YOU will know when you’re ready. It will never be the “right time”, but when it feels like the universe, life, or whatever you want to call it is throwing you into it, when mentally/spiritually or financially you can no longer afford not to, or when you’ve knowingly or unknowingly prepared yourself to rise to the occasion for a once-in-a-lifetime opportunity, that’s when it’s time to strike while the iron is hot. If you’re not feeling that energy, it’s not to say now is not the time. But you may want to explore the idea further before jumping into the deep end, head-first.