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Entrepreneurs are generally considered to be the engine of new job creation economic development. From this driven lot springs the new businesses and jobs coveted by local localities across the US.

In an effort to spark the creation of new business, the entrepreneurial spirit is nurtured in our schools, colleges and business community. In my opinion, this efforts seem to be solely focused on seeding the entrepreneurial pool and waiting for something to grow. An alternative and complementary approach may be the mixing of entrepreneurial talent  "cocktails" to create new business.

To get some insight into what defines an entrepreneur, the following information comes from Wikipedia:

An entrepreneur is a person who has possession of an enterprise, or venture, and assumes significant accountability for the inherent risks and the outcome. It is an ambitious leader who combines land, labor, and capital to create and market new goods or services. (Source)

Entrepreneurship is the practice of starting new organizations or revitalizing mature organizations, particularly new businesses generally in response to identified opportunities. (Source)

The following traits are ascribed to entrepreneurs:

   * Willingness to take prudent risks.
   * Primarily motivated by an overwhelming need for achievement and strong urge to build
   * They are tough, pragmatic people driven by needs of independence and achievement. They seldom are willing to submit to authority.
   * Mercurial, that is, prone to insights, brainstorms, deceptions, ingeniousness and resourcefulness. they are cunning, opportunistic, creative, and unsentimental.
   * Exhibit extreme optimism in their decision-making processes.
   * Prone to overconfidence and over generalizations.
   * Has an enthusiastic vision, the driving force of an enterprise.
   * Vision is usually supported by an interlocked collection of specific ideas not available to the marketplace.
   * Ability to see the big picture while the specifics may be in flux.
   * Promotes the vision with enthusiastic passion.
   * Persistence and determination to develop strategies to change vision into reality.
   * Usually a positive thinker and a decision maker.
   * (Source) ###

The list contains both positive and negative traits. It's my opinion, the ability to shoulder risk is what really separates entrepreneurs from the general workforce. The fear of leaving one's "zone of security" dictates how many of us live our lives. (How many people work jobs they hate because they fear change?)

The economic downturn presents us with a set of circumstances that may be conducive to the creation of entrepreneurial entities. Many qualified individuals have been forced from their zone of security through job or investment loss. Combined with a tight job market, this leaves many with no place to go. Dealing with the unknown has become a daily activity.

Why not package groups with the necessary skill sets (management, marketing and production) and, combined with a mix of training and capitalization, move them toward business creation? (A for-profit, cooperatively owned company would provide equal benefit for all involved in the new start-ups.)

Join us for a further discussion of business creation and business cooperatives (and how they can benefit rural economic development) at:  www.alleganyco-op.com/SMF_Alleganycoop/

Originally posted to Steve Colby on Sat Feb 14, 2009 at 07:10 AM PST.

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Comment Preferences

  •  Single Payer Health for Self Employeds: #1 Stim. (5+ / 0-)

    I notice your essay is framed almost purely in terms of management/finance types.

    My world is artisans and craft & trade people. In my world everyone has a spouse employed for the family health benefits, or else has a gov't pension with health.

    There'd be quite a stampede today into self employment as there would have been any time in the past 20 years of people who moonlight or hobby at crafts, home repair, design, you name it, if there were single payer health for them.

    It's so obvious, yet a distinct subset of the population, that it might be an arm of national health that could be enacted standalone and pass. How could repubs vote against "business?"

    If the biz's annual gross is the person's/couple's sole working income and/or a minimum X% of pension income (so that we don't have retirees selling 2 handbaskets a year for health care), give them Medicare for Self Employeds.

    If the startup is big enough for more than a handful of employees, then they're doing enough biz (for NOW) to go buy their own.

    I want midsize small businesses JEALOUS of the self employeds.

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Sat Feb 14, 2009 at 07:22:58 AM PST

    •  I Agree... (1+ / 0-)
      Recommended by:
      mem from somerville

      Gooserock,
      I understand and agree with your point. I owned and operated a cabinet shop for a number of years (until the interest rates of the early 1980's played havoc with our sales.) I was insured because my wife worked in sales and was a member of a union.

      In my diary entry, I was trying to get across the point that one of the primary traits of entrepreneurs, the ability to shoulder risk, has been somewhat mitigated by the fact so many have been forced into positions of risk. This includes the loss of salary and health care.

      In my opinion, many of the other traits of entrepreneurs can be nurtured or learned.

      As our pool of skilled labor increases, it would seem logical to invest in packaging talent to create businesses, which eventually would become self-supporting, as opposed to continuing to provide unemployment benefits.

      Steve

  •  coops (1+ / 0-)
    Recommended by:
    mem from somerville

    I'd like to convert a business much like gooserock describes into a coop.  At what scale does it make sense and where do i get good legal advice?  Thanks!

    The Shock Doctrine by Naomi Klein -- best book ever, I nominate for a Nobel Prize!

    by xaxado on Sat Feb 14, 2009 at 07:35:41 AM PST

    •  I was introduced to some co-op theory (1+ / 0-)
      Recommended by:
      xaxado

      by my power co-op: Co-op Power.  I attended a lecture they gave about the setup and features.

      I don't know if their slides/presentation is available on the site.  Might be.  But there certainly is a framework and guidelines that are out there.

      Darwinic pilgrims claim the image fills them with an overwhelming feeling of logic. --The Onion

      by mem from somerville on Sat Feb 14, 2009 at 08:34:10 AM PST

      [ Parent ]

    •  Some Information... (1+ / 0-)
      Recommended by:
      xaxado

      Xaxado,
      Here's a few resources to get you started:

      National Cooperative Business Association
      NCBA is the lead national membership association representing cooperatives of all types and in all industries. We are democratically organized and operate according to internationally recognized cooperative principles.

      Through our comprehensive education, co-op development, communications, public policy, member services, and international development programs, NCBA helps co-ops strengthen their businesses so they can better serve their members. It also provides a strong, unified voice on Capitol Hill.

      Our Mission
      To develop, advance and protect cooperative enterprise.

      Our Vision
      NCBA is the leading U.S. organization strengthening the cooperative form of business to empower people and improve quality of life worldwide.

      Our Goal
      To make cooperatives a strong, distinct and unified sector, recognized by the American public.
      ###

      There are also books available on forming business cooperatives i.e. Putting Democracy to Work by Frank T. Adams and others (Amazon)

      Steve

  •  Want to see something scary? (1+ / 0-)
    Recommended by:
    murrayewv

    Here are quarterly IPO tallies since 2004:

    In the December quarter of 2004, there were 53 IPO's.

    In the December quarter of 2005, there were 39 IPO's.

    In the December quarter of 2006, there were 73 IPO's.

    In the December quarter of 2007, there were 71 IPO's.

    In the December quarter of 2008, there was 1 IPO.

    And...

    In January of 2009, there were 0 IPO's.

    So far in February of 2009, there has been 1 IPO.

    That is a fatal economic head-on.

    •  Good Riddence (0+ / 0-)

      for the most part. Too many IPO's have served the sole purpose of enriching a few insiders and the investment bankers and securities brokers who put the deal together, generating vast piles of consultant fees. In many instances, going public has resulted in the eventual destruction of the enterprise and the casting off of its workforce.

      The ultimate purchasers of IPO issues operate under the unfortunate reality that they know nothing about the company they are buying except what the company tells them. Who polices the truthfulness of the information? The SEC does. How secure does that make you feel?

      A decline in IPO's isn't automatically a bad thing. It depends on the reason why. I agree with you that it's a bad thing that we have a horrible economy and accept that the overall economic weakness has contributed to the IPO decline.

      "I Think We're All Bozos on This Bus" Firesign Theatre 1971

      by LeftOfYou on Sat Feb 14, 2009 at 08:21:06 AM PST

      [ Parent ]

      •  I'm not sure decline is the right word (0+ / 0-)

        The tech bubble really gave IPO's a bad taste. If someone had a grandmother named Dott Comm, they were underwritten for $80 million and after the shares were bought, the main question from the investors was what the burn rate would be.

        I generally agree, though; there is a big difference between raising capital to build a jet engine assembly line, and one selling vitamins - which happens to be what the single IPO for this year is.

        The numbers are jarring none the less.

        It gets much uglier when looking at other things, such as the quality of the assets that comprise a big chunk of the Fed's expanded balance sheet. The assets backing our currency actually have a real risk of defaulting, and thereby weakening the dollar. I have searched for indications that the Fed has hedged this, but if they did, they did it off-book.

    •  This and That... (0+ / 0-)

      Mouse,
      I know next to nothing about the world of IPOs but, if the reason for issuing new stock is to raise capital, IMO now would be a terrible time to do so.

      Steve

      Oh, yeah... I am for real.

  •  This is a god idea. I'll see you there. n/t (0+ / 0-)
  •  Err... Good idea. n/t (0+ / 0-)
  •  Agree with Gooserock. (0+ / 0-)

    When I first took the leap, I was horrified by the prospect of getting health insurance.  It turned out there were ways around this, but they are neither cheap nor easy.

    And I would go to all these entrepreneur events and the first question people asked all the time was: What do you do for health insurance?  Not a single question about taxes, as Republicans would have you believe.

    A couple of people that would have been perfect for my business (former colleagues/friends) couldn't come with me because they had the burden of health insurance for their families. I could not obtain the perfect talent.

    I have to say it is MUCH easier in MA now.  I have no fear of being unable to get insurance.

    Small business is full of frustrations.  But it is also full of rewards.  And in crazy times I have much more control and understanding of where I stand than anyone in corporate America.  That's worth a lot to me.

    Darwinic pilgrims claim the image fills them with an overwhelming feeling of logic. --The Onion

    by mem from somerville on Sat Feb 14, 2009 at 08:40:08 AM PST

  •  You left something off the list. (0+ / 0-)

    The entrepreneur you describe needs one more trait to actually earn recognition as an entrepreneur: Lucky. A story, possibly apocryphal, has been knocking around the Navy for generations that an American submarine squadron commander in the Pacific at the beginning of World War 2 told the captains of the several boats in his command, "Men, if you're not lucky, I can't use you." The same thing applies to entrepreneurs.

    Based upon a study of business statistics over a 30 year period, Business Week reported that less than 40% of all business become profitable over the lifetime of the enterprise. Lots of would-be entrepreneurs fail, sometimes time after time.

    When failure comes, the worse angels of the former entrepreneur's nature can dominate producing a person driven, unwilling to submit to authority, mercurial, prone to deceptions, cunning, opportunistic, unsentimental, extremely optimistic in their decision-making processes, prone to overconfidence and to over generalizations.

    These unfortunate souls are not entrepreneurs. They might be bums, or career criminals, or psychotics, or just getting by somehow, but they will not be perceived as entrepreneurs.

    "I Think We're All Bozos on This Bus" Firesign Theatre 1971

    by LeftOfYou on Sat Feb 14, 2009 at 08:55:12 AM PST

    •  I would argue (0+ / 0-)

      that luck is partly perception.  It is you interpretation of events.

      For example: Your house and everything you own could be destroyed by a tornado.  But you hide in the bathtub and get out ok.

      Having a tornado hit your house is not a case of "lucky".  Having the knowledge to get in the bathtub and save your butt, and acting on it, are not just luck.  

      Some people would say that's bad luck for your house to get hit. Some would say you are lucky to get out alive.  Depends on your interpretation.

      Darwinic pilgrims claim the image fills them with an overwhelming feeling of logic. --The Onion

      by mem from somerville on Sat Feb 14, 2009 at 09:16:59 AM PST

      [ Parent ]

    •  RE: Luck (0+ / 0-)

      Years ago, when I was in the cabinetmaking business, I used to refer to the "million dollar customer".
      This was a well-connected, chance customer that walks into your shop and falls in love with a particular item you produce (And tells the world). Instantly you go from obscurity to shop of the rich and famous... And yet, your work may be no better than the shop down the street.
      Luck, destiny...?

      Steve

      •  That's an interpretation. (0+ / 0-)

        Perhaps you had a shop and the skills.  Perhaps someone in the community had mentioned you.  Perhaps you had ads somewhere.  Perhaps he had seen your shop before and had been thinking about it.  

        There is also chance favoring the prepared mind {or hands, or whatever}.  Which I have always thought meant little about chance.

        Darwinic pilgrims claim the image fills them with an overwhelming feeling of logic. --The Onion

        by mem from somerville on Sat Feb 14, 2009 at 04:01:25 PM PST

        [ Parent ]

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