Small Business Labs

Do Small Business Owners Have More Job Security and Personal Time?

Small business ownership is considered very risky by many.  Most small business owners understand the risks they face, but often think working for someone else is even riskier. 

Another set of data supporting this comes from the Ace Hardware Survey of Small Business Entrepreneurs.  As the chart below from the study shows, small business owners feel they have more job security than being an employee by almost a 2-1 margin.

      

Of course those that have failed at small business ownership are not around to get asked the question.  But it is still interesting that small business owners strongly see their jobs as more secure. 

Another interesting finding of the research is that 41% of the small business owners surveyed felt that one of the greatest rewards of owning a small business is increased personal time.  73% also cited flexibility of schedule and independence. 

So small business owners feel their jobs are more secure and they have more flexibility, independence and personal time.  Sounds pretty good - if you make it.

Totally unrelated, I am a big fan of Ace Hardware.  I'm home repair challenged and the folks at our local Ace store really are helpful.

Also unrelated is Ace is a co-op.  Like many other trends thought to be new, business co-ops have been around for a long time.  Ace is 85 years old. 

4 Technologies that are Reshaping Business Intelligence

Franz Dill over at the emerging technologies blog Eponymous Pickle pointed out an interesting article in Information Week on business intelligence technologies. 

Business intelligence systems provide information on the history, current status or future projections of an organization.   Basically, anything that generates data that informs decision making could be considered a business intelligence system.

The article points out 4 technologies that are improving business intelligence systems:

1. predictive analytics:  the ability to do better business forecasting using a mix of data and information sources and analytical software.

2. real-time business monitoring:  the ability to better understand what is happening right now with the key performance factors of a business.

3.  in-memory processing of information: this is a bit geeky, but in-memory processing refers to ability to store and process lots of data and information at one time.  In-memory processing is required to do real-time analytics on large data sets. 

4.  Cloud delivery of business intelligence:  the use of cloud and software as service delivery methods increases business intelligence deployment speed and flexibility. 

Business intelligence systems provide insights on customers and business operations, improve decision making and reduce risk.   These systems are augmenting and replacing "seat of the pants" management techniques and becoming increasingly popular with small businesses. 

In the Developing World, Cell Phones Aren't Just for Talking and Texting

We saw 2 business plan presentations yesterday from companies creating products to generate electricity in the developing world.  Both discussed a broad range of advantages of electrification.   But what was really interesting is both presentations stressed the need for cell phone power and charging as a key driver of demand for electricity.

We were at the Global Business Incubator (GBI) annual business plan presentations.  The GBI is a two week business training boot camp for social entrepreneurs at Silicon Valley's Santa Clara University. 

This year 14 companies were selected to participate from over 300 applicants. In its 7th year, the GBI has a number of successful graduates including the well known micro finance company Kiva. 

One of our take aways from the presentations is the central role cell phones play in these businesses.  This by itself is no surprise.  The role and importance of cell phones in the developing world is well documented (see these NY Times and Economist articles for more on this topic).

But what was surprising is how quickly cell phones have become a key and crucial part of the business infrastructure in the developing world - and how this is leading to impacts well beyond direct voice communications and texting. 

Some of the 2nd order cell phone impacts we heard about yesterday include:

• driving rural electrification
• enabling supply and demand chains
• providing education and training
• improving health care
• providing access to markets and market data
• enabling the organization of groups and co-ops

Related to this trend, Nokia recently announced plans to release a cell phone based mobile payments system targeting Africa and Asia.  One of the reasons given by Nokia is there are a lot more cell phones in the world (4 billion) than there are bank accounts (1.6 billion). 

What are the Characteristics of the Self-Employed?

The quick answer is most are male, white, married and over the age of 45. 

The longer answer comes from The 2009 Small Business Economy, the SBA Office of Advocacy's annual report to the President on how the small business sector of the U.S. economy fared in the prior year.

The report contains a lot of information and quite a bit of data on small businesses.  This year's report also has an overview of self-employment, including a look at self-employment demographics.

According to the report, the self-employed are "...overwhelmingly male, White, married and older..."  And the data for 2007 clearly supports this description:

• 66.7% of the self-employed are men
• 87.4% are white
• 70.5% are married
• 61.2% are 45 or older

There are a couple of interesting trends in the data.  Between 2000 and 2007 total self-employment grew 14.7%.  But a couple of segments grew much faster:

• Hispanic self-employed grew 110%, by far the fastest growing demographic segment
• 55-64 was the fastest growing age segment, up 53%
• Under 25 was the 2nd fastest growing self-employment age group, up 26%

For those not interested in reading the entire report, the self-employment data is on page 110 and the text description starts on page 9. 

101 Tips from 50 Small Business Bloggers

Glen Stansbury from LifeDev and Gregory Go from Wise Bread reached out to 50 small business bloggers and asked them to share their top small business tips.  The list is at the American Express Open Forum post 101 Tips from 50 Small Business Bloggers.

They got a great response.  Some of the best known entrepreneurs and small business experts contributed their tips including Seth Godin, Mark Cuban, Tim Ferris, Jim Collins, Anita Campbell and 45 others - including Smallbizlabs.

The tips list is divided by business area and the tips are short, to the point and often actionable. 

I immediately got value from reading this list and will refer to it often. 

Interesting Twitter Usage Stats

I'm not sure why, but Canada seems to have more than its share of social media analytics firms.   

Sysomos, based in Toronto, is an example.  They collect and help their clients analyze data from blogs, Twitter, social networks, message boards, wikis and major new social media sources.   

Sysomos recently released Inside Twitter, a study that takes a detailed look at Twitter traffic.  The report has lots of Twitter usage information, including:

1.  5% of Twitter users produce 75% of twitter activity.

2.  21% of Twitter users have never tweeted.

3.  85% of Twitter users post less than 1 time per day.

4.  Tuesday is most popular Twitter day.

5.  Most Twitter activity takes place between 11:00am the 3:00pm US eastern time. 

Check out the free report for more information and charts. 

Comparing Small Business Employment in the U.S. and Europe

The Center for Economic and Policy Research (CEPR) recently published a study looking at the rates of small business employment among OECD countries. 

According to the report, the key finding of the study is: “By every measure of small-business employment, the United States has among the world’s smallest small-business sectors.”

Lots of studies have shown that wealthier countries tend to have lower levels of self and small business employment than less wealthy countries.  So we weren't surprised that the US - one of the wealthier OECD countries - would be near the bottom in terms of small business employment measures. 

We decided to compare the small business sector of the U.S. with the European Union.  Since the two have similar wealth levels, this reduces the bias introduced by using OECD country level data. 

Below is a chart showing the percentage of the total workforce that is employed by small businesses in the U.S. and Europe (EU 27) in 2005.  We adjusted the raw data due to small business definition differences between the the U.S. and the EU.  

            

As the chart shows, the percentage of Americans working for small businesses is very close to the percentage of Europeans.  Given the different definitions and data collection measures used, I think it is fair to say they are roughly the same.

Study: The Impact of Social Media on Business Leader Decision Making

The Society for New Communications Research (SNCR) has teamed up with SAP and Leader Networks on a study designed to understand how business leaders use social media, online communities and peer networks to support their decisions.

The study, The New Symbiosis of Professional Networks, will explore the following questions:

• Is social media typically regarded as a trustworthy source of information for professionals? 
• Does social media offer effective tools to access information, advice and engage in professional collaboration? How do they compare to traditional off-line networking?
• What are the tools and sources of social media that professionals rely on to make decisions?
• Will social media change the business and practice of enterprise-level operations?

SNCR Research Fellows Vanessa DiMauro, CEO, Leader Networks and Don Bulmer, VP, SAPand SNCR Board Member are leading this study.

Please help SNCR and the research team by taking their survey.  It is quick and easy and people who fill out the survey will receive a copy of the full research results.

Click here to take the survey. 

The Society for New Communications Research is a non-profit research group focused on understanding the impact of social media on society, communications, marketing and traditional media.  I am a Senior Fellow and board member at SNCR. 

Business Week's Twitter for Entrepreneurs - 20 to Follow

Smallbizlabs is honored to be on Business Week's list of 20 people for entrepreneurs to follow on Twitter.  As the Business Week article points out, the list includes Twitter celebrities like Richard Branson, Chris Brogan, Tim Ferris, John Jantz and Anita Campbell. 

Others on the list, like Smallbizlabs, are less well known. 

They did not include their own twitter address on the list - @newentrepreneur - but it would be on the list if someone else had created it. 

Our twitter address is @smallbizlabs and we hope to see you on Twitter. 

Intuit Looking to "Speed Date" Potential Small Business Partners

If you are a small business, you know how hard and painful it is to develop a business partnership with a large corporation.  Even if you can find the right person to talk to, the path to creating a business relationship is long and cumbersome. 

Intuit Corporation is looking to turbocharge this process.  They are holding an Entrepreneur Day on October 5th where selected small businesses will be given the opportunity to meet with and discuss business partnership opportunities with Intuit senior executives.

The day is being positioned as a "speed dating" event.  It will combine brief presentations by Intuit execs (they promise no death by powerpoint) followed by interactive round tables and private one on one business partnering meetings. 

      

A limited number of companies will chosen from the pool of applicants.  To apply to participate or learn more, click here.   The application deadline is September 10th. 

I'm personally excited about this event because Emergent Research is an Intuit business partner.  We work with Intuit on the Future of Small Business research and report series.  And one of the trends we are tracking and forecasting is increased collaboration between large corporations and small businesses. 

We describe this trend in more detail in Intuit Future of Small Business research report The New Artisan Economy.  If you want a shorter version, the New York Times covered this trend in an article last spring.

Oh by the way, Intuit is an excellent business partner.  So if your business is a good fit make sure you apply for the opportunity to work with them.