Think You’re Not A “Real” Business Owner? Think Again.

Most, if not all of my clients have a confidence problem. That’s probably the single most common reason that people hire me, is because it has become exhausting trying to grapple with the issue and they want someone they trust to check their thinking, and to offer an opinion that hasn’t been biased by the voice of Imposter Syndrome.

The most common one is “Who am I to be running a business?” and the second most common one is “Who am I to call this a business?”

Not a Real Business Owner

The two questions that haunt the self-employed are: “Who am I to be running a business?” and “Who am I to call this a business?”

Now, I could go the emotional intelligence route and explain that while you might feel overwhelmed and out of your depth, actually, everyone feels that way, they just get better at coping with it or ignoring it.

But I prefer to start with the facts.

Starting with the facts is like using logic when you’re lucid dreaming. What are the chances that I would show up at school topless? Zero? Right then, this must be a dream. What are the chances I would jump off a cliff just to see if I could fly? …. Well, not zero, but pretty low. Probably a dream.

Not a Real Business - Businesses and employees infographic
Infographic created by BusinessNewsDaily.com. (Click for larger image)

And so it is with these “who am I?” questions.

Let’s start with the “this isn’t really a business” thing, because it’s the easiest to refute.

That’s Not a Business. THIS is a Business.

Contrary to popular opinion, most businesses are not big. Most businesses aren’t even medium sized. Look at this–>

  • Of the 5.73 million businesses operating in the U.S., 3.5 million of them have 0-4 employees. That’s over 60%!
  • Look at the long tail distribution in the graph. Want to bet which side drives the most revenue?
  • The next infographic, also released from Business News Daily, uses data from recent Sage survey, reports that small businesses produces over 50% of the American GDP— not counting farms.

Just so you know, the GDP of the U.S. is over 13 trillion. You and people like you contribute almost 7 billion dollars of that!

Not a Real Business - Small business facts
Infographic created by BusinessNewsDaily.com. (Click for larger image)

Now, this infographic notes that a small business is defined as any business under 500 people.

But, it also notes that more than half of small businesses are home-based. That’s almost 2 million home based businesses in the U.S. alone. Canada, which has about one-tenth of the population of the U.S, has over a million small businesses — about twice as many small businesses per capita.

Did you notice that over 20 million Americans run businesses with zero employees? Sure that’s an old number, but I bet it’s only gone up since the global economic crisis.

That’s me. That’s my clients. That’s most of my readers. We are legion. We are not only economically productive, we drive the fucking economy.

But wait! There’s more….

 

(keep scrolling. It’ll be worth it, I swear.)

 

 

 

 

 

 

 

 

 

 

 

(No, seriously. There’s more pictures. Maybe even pictures of kitties.)

 

 

 

 

 

The Freelancer Question

One of the most frustrating things to me is how few freelancers think of themselves as business owners. In my opinion, refusing to acknowledge that you run a business  (yes, with all the marketing and red tape that entails) causes many freelancers to run around with dangerous blinders on.

To borrow some language from The E-myth Revisited, it’s not enough to be a Technician. You have to be an Entrepreneur, or what I call, a Boss. (Because being a Boss sounds much cooler. Very retro.)

Because freelancing is a REAL BUSINESS. Don’t believe me? I have yet another infographic for you.

Not a Real Business - Freelancers
Infographic by International Freelancers Day. (Click for larger image)

That infographic (small though the survey pool might be) ought to go a long way towards convincing you what an outstanding business model freelancing is. You’re relatively insulated from economic downturns, you set your rates and your hours, and you can delegate or outsource to others when you get busy.

Who Am I to call Myself a Business Owner?

You ARE a business owner. That’s as much qualification as you need. Any possible objections you have probably have data to destroy them.

There is nothing wrong with you; certainly nothing that will prevent you from succeeding in business.

Hopefully with the facts on your side, you’ll be able to shut up that nasty little voice inside your head.

Not a Real Business - kitties
I promised kitties. Thanks for reading all this way.

Tell me, what was the most surprising fact you learned from all these infographics?

[ssbp]

11 thoughts on “Think You’re Not A “Real” Business Owner? Think Again.”

  1. Hmm, most surprising thing I learned? Interestingly enough, it is that I appear not to be swayed by statistics 🙂 I spent the entire article going “Oh, interesting!” and “Huh!” in a totally detached, this-doesn’t-apply-to-me sort of way. Amazing how quickly my brain said “Cool! For all of those people. Too bad you aren’t one of them.” But then, I’ve generally always been hard to convince with cold, hard facts.
    Aside from that, I’m completely shocked by how many businesses have no (or almost no) employees. That’s nuts!!

  2. Most, if not all of humans have a confidence problem. It’s not just your clients, Shanna.
    Lost in these pretty pictures and stats is the impact of people like me and you (you know, businesses with zero employees). Separate to our contribution to GDP, how do we assess our cultural, intellectual, environmental, or other types of impact? Because being your own boss is awesome, but I didn’t become an entrepreneur to be my own boss (OK, maybe I did … a little). I became a business of one to make a much bigger and better impact on my own than I could in my large corporation. 
    Do you have any infographics or stats on the results of all us groovy little business guys and gals?

  3. erinkurup What? You mean sheer logic isn’t enough to sway you!? No worries. It’s only a place to start. The first thing to do when tackling a problem is to determine whether it’s internal or external. How much the stats are able to sway you, however, is a personal psychology thing. 
    Crazy right? The most frustrating thing is the variation in how people define businesses. The SBA reports 5.73 million businesses in all of the U.S. in the first image, then almost 30 million in the second. They have to have used different definitions for each of the surveys (assuming the infographics reporting is accurate.) So although I’m not going to swear the numbers are totally accurate, I think the point of “a lot of businesses are just like you” is upheld.

  4. joeyjoejoe I don’t know of any methodology that measures cultural or intellectual impact. Environmental impact is potentially measurable, but it depends on how many degrees of separation you can define as being “responsible for.” Am I responsible for the impact of my electricity coming from coal-powered plants in West Virginia? What about for the food crops that the cows from the meat I eat consume? Tricky to define, and because the definitions are flexible, can tailor them to support either conclusion. 
    Klout was hailed as a marvel for being able to measure impact and influence– but you’ve no doubt noticed how shitty it is. Academic papers and an “impact score” which rises in relation to how many times it is cited. That can be gamed, however. Being mentioned by a NYT columnist virtually guarantees you a high impact score, because it makes your research so easy to find. The answer therefore, is not to do more research, but to make sure your research gets noticed. It’s a slippery slope. 
    All these externalities are subjective, which means research into them is difficult and unreliable. 
    However, as a small business owner, you can easily figure out your own metrics and measure them. Just like we don’t really have to pay attention to economic trends because our needs are so small, we don’t really have to pay attention to how the Establishment defines impact. How many people recognize your name? Use your terminology? Answer your emails? Decide what effect you want to have, and then figure out how to do it. 
    I know that was a much more earnest answer than you were looking for, but I’d been thinking along those lines for the next post as well 😉

  5. Most surprising… the small percentage of minorities with small businesses. I wouldn’t have guessed that.
    I think another reason some don’t consider their business “real” is if their not getting much sales (yet) so it prevents them from taking it seriously.

  6. deniseurena I thought the number was low myself, but I looked up the percentage of minorities in the US. Census data reports that 77.9% of the population lists their ethnicity as “White Alone.” http://quickfacts.census.gov/qfd/states/00000.html So the number is slightly low, but not shockingly low, I don’t think.
    Sales are a big part of a business. However, I think people underestimate how long it takes for a business to ‘catch.’ Five years used to be the rule of thumb to break even on your investment.

  7. I rather like your curated presentation of these infographics. I often find infographics to appear out of context, though. So what was nice about this was that you used them to build a point. I think as far as being a business owner goes, I constantly need to tell myself these kinds of things. I can be hard on myself and say things like “I just have a job that I created for myself”, because I’m still mostly selling my time.  However, this could easily change– and the fact that the business has a structure, products, and a name that isn’t my name means that it could much more easily scale then a job or “gig” for me.

  8. ethanwaldman Thank you! I actually saw one (not pictured, but linked to) on Canada’s small businesses, and it got me thinking, why on earth aren’t people shouting this from the rooftops? We are so legitimate! See! See!

  9. Karen J Compared to the numbers the Department of Labor crunches, it is indeed small. Actually, the guys who ran that conference and did that survey are also the authors of The Wealthy Freelancer.

  10. Shanna Mann ~

    Agreed, this *is* a small sample. Since pharmaceutical companies get away with using tests on 15 or 20(!) people, I figured I’d ask, though. 😉

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