Columnist . Ron Wacks
MICROBUSINESSES ARE FROM VENUS
(Excerpted from a presentation made by Ron P. Wacks in Budapest, Hungary)
We’ll cover Micros in the context of history, issues of the day, economic development, job creation, innovation, entrepreneurship, start-ups, defining success and sustainability, the Microbusiness “gender”, and international engagement. Think of Microbusiness as the “merchant class” of the last 3,000 years.
One adult in seven in the United States owns or is a principal in a Microbusiness. Yet, few understand much about the Microbusiness demographic, market or constituency—our strengths and our fears, our priorities and our processes, our cares and our habits, our needs and our numbers. The innovation and job creation we contribute is as misunderstood by policy makers, the corporate community, and the media, as women are by men.
First, let’s talk about the Small Business and Microbusiness “Grand Canyon”. The U.S. Small Business Administration (SBA) defines a Small Business as a firm with fewer than 500 employees (with few exceptions). So, a Small Business is not small. A Microbusiness is a firm with fewer than 10 employees or people—you can fit everyone in the company in a van. It is small yet the differences between a Small Business and a Microbusiness can only be described as Grand Canyon-like. They are mammoth.
Even more startling is that those who create public policy and make critical economic decisions that impact the U.S. economy, the job market, and consumers know little about Microbusiness owners, practices or priorities. This cavernous lack of understanding seems to defy common understanding considering the “age” we’re in.
For centuries, farming and herding largely dominated the world’s economic engine and thus, that historic period was known as the “Agricultural Age”. Relatively recently, there was a massive shift in the world’s economy that led to the production of goods and products for sale and the invention of tools, machines and methods for producing them in mass. This historic and life altering period was called the “Industrial Age” and changed the world for over two centuries. More recently, the “Technological Age” has literally reshaped the world (by making it much smaller). The age of technology has completely impacted our lives and more interestingly the technology invented has helped to bring about the next great age—the age that is now the dominant force in the U.S. and around the world. The great age that has spanned the last two decades and promises to reach far into the future is the “Entrepreneurial Age”.
The Entrepreneurial Age differs from the other Ages in a rather historic way.
The Entrepreneurial Age is the era of the Entrepreneur—the person; the creative professional; the innovator—the individual or small group business rather than the tools or products that dominated the economy as in previous eras.
This Age is about the person and the method of doing business rather than the business itself or tools used—it’s about the who, not the what. This is a significant development that is going largely unnoticed or acknowledged for what it is—great historic change—an innovation in its own way.
Part of this significance is that 95.8% of all U.S. firms are Microbusinesses—firms with fewer than ten employees (or people). This is a significant number of people who are engaged as business owners or principals rather than employees as in the Industrial and Technological Ages or engaged in farming as a single business category. The Entrepreneurial Age features people engaged in businesses from A to Z—from technology to Tupperware® which again differs from the other eras in history. Also different are many of the primary reasons people start and grow their own businesses rather than serve as employees.
95.8% of all U.S. firms are Microbusinesses
I am unaware of any scientific data on this, but from the thousands of entrepreneurs and self-employed with whom I have spoken over the years, one thing is clear.
Few of them have wealth or large profits as their #1 priority, objective or motivator. Sure, all of them are in business to make money—to earn a living, but for most of them, money beyond a decent living is not their number one priority, as it seems to be with larger businesses. The reasons I hear most often are autonomy, independence, self-determination, flexibility of schedule, creative control, greater financial security, and ability to be responsible for the outcomes of the business.
There are also the pride and personal achievement factors. Just as there is much in life that money cannot buy, there are also many things in one’s professional life that are more important than money. This is another deviation from the norm—an innovation of attitude and priority.
There is also a prevailing truth that has surfaced over the past few decades and seems to be gaining strength throughout the business community. That is, professional work is more integrated with people’s personal lives when they are self-employed or a principal in a small firm where they have influence over outcomes. This differs greatly from an employee model where the worker is often divorced or detached from decisions and outcomes and where their value is minimal and employees are often made to feel that way.
This translates into Microbusiness owners giving more to their professional lives as they are more invested in the outcomes…and their pride can come through as a reflection of their abilities. “Do you live to work or work to live?” These elements greatly affect how success is defined along with highlighting motivations, how decisions are made, and what makes Microbusiness tick.
Tune in next time as we explore many specifics.