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America’s New Business Plan: Knowledge

THE KNOW-HOW TO START A BUSINESS

Entrepreneurs report that some of their biggest challenges are practical, such as knowing how to start, operate, and grow a business. Given that many entrepreneurs were not taught the skills needed to successfully launch a business during their formal education and training, they learn as they go, seeking support from other business owners and organizations that offer coaching.

Strong ecosystems foster the fast flow of talent, information, and resources, helping entrepreneurs quickly find what they need at each stage of business development. When entrepreneurs are able to find the resources they need, they report value from these connections. Sixty-four percent of entrepreneurs found the opinions and insights of others who have started a business to be helpful. Even more (79%) said they would participate in weekly programs for local entrepreneurs to come together for conversations if those programs existed and they knew about them.

Yet aspiring entrepreneurs have fewer connections to relevant resources than existing business owners do. In a recent survey, more than half (55%) of established business owners reported knowing more than five other business owners, but only 39% of entrepreneurs who had started a business in the past year reported the same.

To succeed, new businesses also need access to high-quality workers. Forty-two percent of startups report that it is difficult to hire employees. This is particularly a challenge in rural areas that have suffered “brain drains” as their labor pools have migrated to urban centers. In a 2019 Small Business Majority study, all 21 focus groups of rural business owners stressed that good employees are difficult to find.

Developing a continuous pipeline that offers Americans a lifetime of opportunities to learn the skills necessary to be a successful entrepreneur is vital to a thriving U.S. economy.

What can government do?