"Entrepreneurship plays an important role in growing our economy," Granholm said. "It is critical that we develop a supportive educational environment for our young people that instills entrepreneurial thinking so they can see themselves as innovators, producers of jobs and financial success."

~ Jennifer Granholm, Governor of Michigan

SMALL BUSINESS STATISTICS

Did you know that...

• THERE WERE APPROXIMATELY 22.9 MILLION SMALL BUSINESSES IN THE U.S. IN 2002.
• THERE WERE AN ESTIMATED 550,100 NEW EMPLOYER BUSINESSES IN 2002 -- A 0.9 PERCENT INCREASE OVER THE PREVIOUS YEAR.
• SMALL BUSINESSES HIRE A LARGER PROPORTION OF EMPLOYEES WHO ARE YOUNGER WORKERS, OLDER WORKERS, AND PART-TIME WORKERS.
• BUSINESS BANKRUPTCIES WERE 38,155 IN 2002, ABOUT HALF OF THE LEVEL REACHED IN THE LATE 1980'S.

SMALL BUSINESSES…

• PROVIDE APPROXIMATELY 75 PERCENT OF THE NET NEW JOBS ADDED TO THE ECONOMY.
• REPRESENT 99.7 PERCENT OF ALL EMPLOYERS.
• EMPLOY 50.1 PERCENT OF THE PRIVATE WORK FORCE.
• PROVIDE 40.9 PERCENT OF PRIVATE SALES IN THE COUNTRY.
• ACCOUNT FOR 39.1 PERCENT OF JOBS IN HIGH TECHNOLOGY SECTORS IN 2001.
• ACCOUNT FOR 52 PERCENT OF PRIVATE SECTOR OUTPUT IN 1999.
• REPRESENT 97 PERCENT OF ALL U.S. EXPORTERS.

HTTP://WWW.SBA.GOV/ABOUTSBA/SBASTATS.HTML

ENTREPRENEURSHIP: THE "SILENT REVOLUTION"

DEFINITIONS, DATA, AND TRENDS

DEFINITIONS

Entrepreneurship comes from the French noun entreprendre and according to Webster's means:

a person who organizes and manages a business undertaking, assuming risk for the sake of profit.

The word "enterprise," as in free enterprise system, shares the same root.

When Jeff Timmons taught entrepreneurship at Harvard Business School and Babson College, his definition was broader than Webster's.

He described the entrepreneurial way as far-reaching, creating impact throughout the private and public sectors.

After explaining, Timmons suggests that the silent revolution of the '70s and '80s is not that silent anymore.

"Entrepreneurship is about creating and building something of value from practically nothing."

We have a working definition of entrepreneurship that we use in our programs at Harvard and Babson College that goes something like this:

It's the creation, recognition and pursuit of opportunity regardless of the resources that you currently have under your control.

Now, this has a lot of pretty profound implications if you think about it. It means that entrepreneurship can occur in new companies but also in old companies, small ones as well as big ones, fast-growing and slow-growing ones and it can occur in both the private and the public and the not-for-profit sectors. It's about a process. It's about people. It's about opportunity. It's about marshalling, minimizing and controlling resources.

DATA & TRENDS

Until recently most people considered entrepreneur a fancy, highbrow word used largely by academics and business writers, but how things change. Today it is in common usage and, most importantly, this single word now defines the main energy and force behind the economy.

Now let's take a look at entrepreneurship in America today. I maintain that we're in the midst of what I call the silent revolution. It's an extraordinary revolution of the human spirit, the extraordinary power of the entrepreneurial mind. Now, why do I believe this is happening. Consider some of the following. Let's go back just one - one generation, 25 years ago. At that time if you were graduating from college or high school, the odds were that 1 in 4 people would be working for a Fortune 500 company. Today that number is down to 1 in 11. At that same time if you said how long does it take to replace 35 percent of the companies on the Fortune 500 list, that would happen about every 20 or 25 years a generation ago. Today that's happening every three or four years. Or take how many companies are started each year. If you went back a generation ago, about 200,000 new companies were created each year in this country, but today it's in the range of 1,200,000 each year, six times in a generation when the population has only increased about 25 percent in our country.

"The other area that is powerful evidence of this entrepreneurial wave, this silent revolution, is the role of these entrepreneurial innovators in creating the industries of tomorrow. They are truly the engine of economic growth. They've always been the innovators. Think about personal computers, spreadsheet software, soft contact lenses, all of those have come from individual entrepreneurial companies not huge companies. And in an earlier era, the airplane with the Wright brothers, the helicopter, the Polaroid camera, the safety razor, quick-frozen foods. It's almost impossible to think of a radical innovation in our economy that hasn't come from the small entrepreneurial company. And since World War II it turns out some 95 percent of all the radical innovations in our country have come from these small entrepreneurial firms."

"I truly believe that this silent revolution will have a greater impact on the twentyfirst and twenty-second centuries and all of our lives than the industrial revolution had on the nineteenth and twentieth century. And if you've been thinking a lot about taking charge of your life through some entrepreneurial avenue, you, by no means, are alone.

"A recent Gallup poll, for example, showed that half of all the adults in America want to own their own company. And when the Gallup poll went to high school seniors across the country, that number jumped to 70 percent. These are totally unprecedented numbers. We've never seen, in my lifetime, any kind of societal aspiration and dreams to this extent in our country.

"So I believe we're right on the cusp of a second tidal wave of this entrepreneurial silent revolution that in many ways in the next 50 years is going to dwarf what we've seen during the last generation."

• Entrepreneurship is a widespread activity in the United States. Participation is as common as getting married or the birth of a baby. About 6.2 in every 100 U.S. adults 18 years and older are engaged in trying to start new firms. That means that approximately 10.1 million adults in the United States are attempting to create a new business at any time.
• About one-half of all new ventures are started by teams of people. The 10.1 million involved in startup activities represents about 5.6 million potential new businesses.

• According to the 1990 United States Census, people with disabilities choose self-employment at a higher rate than people without disabilities (12.2% vs. 7.8%).

The Rural Disability and Rehabilitation Research Progress Report #15 (July 2002) http://rtc.ruralinstitute.umt.edu/

Small businesses and entrepreneurial ventures still drive much of the American economy.

• There are 22 million small businesses-over 95% of all businesses in the United States. During the 1990s, 85% of all new jobs in the United States were created by small firms and 70% of these by the fastest growing entrepreneurial firms.
• Innovation and new solutions have much freer reign in many small businesses.
• New small firms produce 24 times more innovation per research dollar than do the much larger Fortune 500 firms. The National Science Foundation estimates that 98% of "radical" product developments result from the research done in the labs of small companies.

SOURCE: STRATEGIC MANAGEMENT AND BUSINESS POLICY, WHEELEN & HUNGER, PRENTICE HALL, PP. 301-302

"It is difficult to say what is impossible . . .

for the dream of yesterday is

the hope of today and

the reality of tomorrow"

~Robert Goddard

"The important thing is not being afraid to take a chance.

Remember, the greatest failure is to not try.

Once you find something you love to do,

be the best at doing it."

~ Debbi Fields, founder of Mrs. Fields Cookies