Is starting a business as exciting as the birth of a child or getting married?
Starting a business is as exciting as the birth of a child, according to one in five British entrepreneurs, with many even equating it to their wedding day.
However, a lack of a business plan, struggles to recruit and late payments mean most have shut up shop within five years.
New research from cloud accounting software company Xero, to launch its behindyourbusiness campaign, revealed that 82 per cent of small business owners said they were now running the business they always dreamed of.
Just over half said being their own boss was the best thing about starting a business, followed by 38 per cent stating it was being able to control the work/life balance. Just over a third, 35 per cent, said it was being able to get things done the way they want them to.
Nine in ten small business owners said setting up shop was one of the accomplishments they are most proud of, with half likening the buzz to the feeling of buying a first home. One in five compared it to the birth of their child and 16 per cent said it was even like their wedding day.
The research found that entrepreneurs are driven by a need for more flexibility and to take control. Other reasons included not enjoying working for somebody else and wanting to make their family proud.
However, in a world where only four in ten businesses reach their fifth birthday, the research found that a fifth of start-ups launch without a fully-fledged business plan.
Barriers to business success
Small business owners named making the right hires, 32 per cent, the inability to switch off, 29 per cent, and late payments, 29 per cent, as their biggest barriers to success. The majority resort to enlisting friends or family to work for their business, because they can trust them, understand each other and know they will be committed.
Xero also found that entrepreneurial spirit is getting younger, revealing 20 as the age that young business owners between 18 and 34 decided they would like to set up shop compared to those aged over 45 who had the same lightbulb moment at 35.
In fact, almost seven in ten new businesses set up in the past five years have been started by those aged between 18 and 34 years old.
Commenting on the findings, Gary Turner, co-founder of Xero, said: Small business owners don’t always have an easy run of it. But, despite this, every day I see just how passionate and eager they are to turn their dreams into realities.
while this passion is fantastic, it will only get you so far. We know that survival rates of small businesses with watertight business plans and the right processes are far greater than those who fail to put the right provisions in place so it would be a huge shame to see this enthusiasm go to waste.”
The owners also named Bill Gates as their favourite living business icon followed by Richard Branson and James Dyson.
For the first in a new Business Advice series on starting a new company, Grid Law founder David Walker explains which legal priorities should be at the top of every new business owner's to do list. more»