Small Business Labs

The Rise of Ecommerce Nomads

The Verge's Road-Tripping With Amazon Nomads looks at people who travel across the country looking for merchandise they can sell for a profit on Amazon.

Key article quote defining Amazon Nomads:

" ... merchants who travel the backroads of America searching clearance aisles and dying chains for goods to sell on Amazon. Some live out of RVs and vans, moving from town to town, only stopping long enough to pick the stores clean and ship their wares to Amazon’s fulfillment centers."

These nomads are a digital version of a business that's almost as old as commerce itself - retail arbitrage.  

Their goal is find products that for some reason - a chain going out of business, discontinued items, etc. - they can buy for less than they can sell it for on Amazon.

As the article points out, this is not an easy business.  Margin's are low, competition stiff and the logistics challenging.

And as the article picture below showing a nomad's van during loading, the hours are long and can easily drag well into the night.  

We've interviewed a wide variety of people pursuing retail arbitrage.  

A more local version is combing through garage sales and flea markets searching for items to sell on Craigslist or Facebook Marketplace.  

These retail arbitragers tend to mostly stay close to home, instead of traveling long distances.  

An example is people looking for rare baseball cards, which have become more popular and valuable thanks to the pandemic.  

Another is an entrepreneur we interviewed who focused on finding, refurbishing and reselling used refrigerators in the St. Louis area.  He mostly sold them us Craigslist and we can confirm the business is quite profitable.

And while it's not an easy business, being an Amazon nomad shares the appeal of other forms of digital nomadism - travel, freedom and a sense of adventure. Key article quote from one of the nomads:

“It’s kind of nice to just be carefree, you know?

How the Pandemic Changed the Way Americans Spent Their Time

The New York Times article More phone calls, less shopping: how the pandemic changed American lives, down to the minute examines data from the American Time Use survey to show the changes in how Americans spent their time last year.  

The article charts below (click to enlarge) shows the biggest winners and losers, timewise. 

The key change from 2019 is that during the second half of 2020, Americans spent ten waking hours a day at home. This is up from 8 hours in 2019.

We spent about a third of that time on leisure activities, with the rest spread out across a variety of endeavors - including getting a bit more sleep.

According to the data, we spent less time on grooming, but only 5 minutes less per day.  This is likely an example of people not telling the truth on surveys. 

Based on our personal experience and anecdotal observations of others, grooming time fell by much more than that.

Combo Social Club/Coworking Space Soho House Went Public

In a clear signal that coworking is coming back post-pandemic, the high-end combo social club/coworking space Soho House went public last week under the name Membership Collective Group.

Soho House is targeted mostly at creative professionals and has 30 current locations across the globe.  It's planning on opening 16 more over the next 18 months.

Austonia's Peek inside Austin's Soho House, a ritzy new club for creatives on South Congress, details the amenities at the Soho House in Austin, Texas. It gives readers a good sense of what you get when you join.  

Key quote from the article:

"From its garden-studded outdoor space and rooftop pool to its cozy-yet-luxury indoor bar and club, Soho House Austin has arrived."

The article picture below shows the pool area.

According to Reuter's Soho House IPO Sets High Price for Entry, the chain has 119,000 members and a waitlist of 59,000 looking to join. It also has attracted celebrities such as supermodel Kate Moss to their clubs.  

Not bad, given most Soho Houses were closed due to the pandemic.

Of course, belonging to a Soho House is not cheap.  Memberships run $3000 - $4000 per year and there are lots of extras.  Drinks at the Austin location, for example, run $14.  

But they are great places to relax, work and network.

Traditional city social clubs have long been a fixture in society. They've been places that combine social and work activities, but most have heavily focused on the social. 

But over the past decade or so, new combo coworking/social clubs - with Soho House being an example - have emerged.  These places provide a social side but are much more focused on work.

And that appears to be a winning combination.

It's Time to Upgrade U.S. Economic and Labor Statistics

Sometimes we post articles on topics few people are interested in. 

This is such an article.  

But you should be interested because the economic and labor data collected by government agencies no longer provide the information we need to properly understand and manage the U.S. economy.

Over the past week several sources explained the problems with government data collection efforts and made suggestions on how to improve them.

Before we go into them, it's important to note both sources state the biggest problem is we've been cutting the budgets of our statistical agencies for years. 

This has hamstrung their efforts to develop new and better approaches to collecting and disseminating data.

Infrastructure: Upgrading the US labor statistics system is a podcast by Harvard's Future of Work program.  It features former U.S. Bureau of Labor Statistics Erica Groshen, who explains how and why we should improve our economic data gathering capabilities.  

Federal Statistical Needs for a National Advanced Industry and Technology Strategy is a report from the D.C. innovation think tank ITIF.  The key takeaways from this report are:

• The federal government has never felt the need to develop strategic economic intelligence to fully understand the competitive position of its traded sectors or to help support overall economic productivity.
• Years of budget constraints have left U.S. statistical agencies with insufficient resources to effectively measure key elements of the economy.
• There are three key areas with major statistical gaps: subnational data, international data, and data to better understand firm behavior at the enterprise and establishment level.
• As part of a national infrastructure package, Congress should make a one-time appropriation to fully modernize and expand federal statistical agency IT systems. It should then increase annual funding on an ongoing basis.

The lack of timely and complete data on the economy has become a problem for the U.S. 

We regularly see this in our work.  For example, there's still no solid government data on independent workers and most government data on small businesses are too old by the time it's released to be of use.

The economy moves too quickly and changes too often for our old data collection methods.  It's time for the U.S. to make the investment required to collect timely and relevant economic data.

Forerunner Ventures on Solopreneur Commerce

Forerunner Ventures was founded about a decade ago with a focus on direct-to-consumer ecommerce brands. 

And they've invested in some of the most successful companies in this space, including Bonobos, Warby Parker, Jet, Dollar Shave Club and others.

They are now investing in a space they call The Empowerment Economy, which they describe as:

"The true power of digital connectivity is set to upend the economy at large, powering a new generation of solopreneuers and financial freedom. This movement stands to uplift more people than any economic evolution to date."

Their essay The next revolution in commerce will be driven by the seller goes deeper into this thesis:

If commerce is a transaction between buyer and seller, the face of the seller is evolving with new tools for discovery and purchase that allow for a personal relationship between creator and customer. Beyond a corporation or mass retailer, the seller is now frequently a person or small business. We are seeing a new long-tail retailer learning how to make the internet work in their favor, enabled by social media and without the need to lean into a digital mass marketplace—they simply need a captive audience, which is easier to attract than ever.

Forerunner's chart below summarizes why think this happening at this point in time.

The emergence of niche and solopreneur ecommerce firms is not a new trend. 

But it appears to be hitting a growth inflection point, helped in part by the rise of the creator economy.  Creators need ways to generate revenue, and an increasingly popular way is by selling merchandise to their fans.  

The growth of solopreneur ecommerce is also showing up in the business applications and formation statistics, with applications from solopreneur retail businesses at an all time high.

So we agree with Forerunner and expect solopreneur ecommerce to continue to expand.

HBR on Why Companies Need Digital Nomad Programs and Policies

The Harvard Business Review's Your Company Needs a Digital Nomad Policy covers the reasons why companies should have formal digital nomad programs and policies.  

Based on an extensive study of digital nomads done by Emergent Research and MBO Partners, the article highlights two key reasons digital nomad policies and programs are important.

The first is that digital nomads, who are well educated and digitally savvy, tend to work in professions where talent shortages are common and attracting and retaining employees is a constant challenge. 

Coherent, explicit digital nomad programs and policies make it easier to hire these in-demand workers and engage, reward, and retain existing employees who wish to travel.

The second reason is that having digital nomads on the payroll can leave firms open to a variety of regulatory and legal risks. Key article quote:

"The laws and regulations that apply to a person’s work are generally based on the jurisdiction where the work is performed, even if the employer is located elsewhere. As a result, digital nomads can easily and accidentally create a new “permanent establishment” for their employer in the state or country where they’re working. That exposes both the employer and the employee to the new jurisdiction’s tax, regulatory, and compliance rules and laws."

As the digital nomad study chart below shows (click to enlarge), 10.9 million workers report being digital nomads.  And, most of them (6.3 million) have traditional jobs.  This means most larger U.S. firms have digital nomads on their payroll, whether they know it or not.

See the article - written by us and Miles Everson, CEO of MBO Partners - for more details.  Also, see our Digital Nomad section for more on this topic.

A VC's Guide to Gen Z

Digital Native is an interesting Substack newsletter from Index Ventures' Rex Woodbury.  

His recent article - A Guide to Gen Z Through TikTok Trends, Emojis, & Language - nicely describes several behavioral characteristics of Gen Z.  

It also covers their often changing and confusing (at least to older generations) use of emojis, language and social media.   

The article breaks the behavioral descriptions into 3 categories:

1.  Authentic & Unique - Key quote:

"Authenticity—while becoming a tired word to describe Gen Z ethos—captures where young people derive status online: status comes from being singular. If Millennials tried desperately to fit in, Gen Zs try desperately to stand out."

2.  Creative & Self-Expressive - Key quote:

"Gen Zs view themselves as highly-creative: over half (51%) say that Gen Z is more creative than previous generations. While Gen Zs deserve some credit (they really are quite creative!), they’re also the beneficiaries of better tools for self-expression. TikTok makes it orders of magnitude easier to be creative than a platform like YouTube."

3.  Pragmatic & Self-Directed - Key quote:

“Traditional” careers are anathema to many Gen Zs. Many grew up watching parents lose jobs during the Great Recession; they have an inherent skepticism of “the system” and refuse to work within it. This manifests in everything from growing populism (see: Donald Trump and Bernie Sanders) to the rise of Dogecoin and side hustles."

The simple article chart below (click to enlarge) is our favorite from the article. It illustrates how much easier for Gen Z to be both creative and entrepreneurial than it was for prior generations.

Gen Z's entrepreneurial interest is most relevant to us.  

But all three attitudes are important in terms of how Gen Z will impact society and the economy in the coming years.

Small Business Applications in May 2nd Highest Ever

May was yet another banner month for new business applications.  As the U.S. Census chart below shows (click to enlarge), 500,219 business applications were filed in May. 

This was the second highest number of applications filed since this data was first collected in 2005.

The recent surge in applications started last summer in July when a record 551,000 business applications were filed.  

The surge has, so far, continued in 2021.

See our prior posts on the business applications surge for more on this topic:

• May 18th, 2021: Led by Retail, The Surge in New Business Applications Continues
• February 12t, 2021: New Business Applications Surged Again in January
• February 9th, 2021: The Long Term Shift in Business Applications to Solopreneurs
• November 10th, 2020: The Surge in New Small Business Applications

McKinsey on Technology Trends

McKinsey, which is best known as a strategy consulting firm serving CEOs and seniors executives at large corporations, recently released its top trends in tech list.

They say the list was developed using a "unique methodology" that identifies the trends "most relevant to competitive advantage and technology investments."  The list is below (click to enlarge).

Despite McKinsey's unique methodology, the list looks pretty similar to other technology trends lists to us. 

But McKinsey does a nice job of explaining the trends and why they are important.  It's also worth knowing what McKinsey is thinking because of their corporate C-suite and board influence.  

And we like and agree with McKinsey's view on what's driving technological change.  Key quote:

"Unifying and underlying them all is the combinatorial effect of massively faster computation propelling new convergences between technologies; startling breakthroughs in health and materials sciences; an array of new product and service functionalities; and a strong foundation for the reinvention of companies, markets, industries, and sectors."

When we founded Emergent Research many years ago we debated whether or not to call ourselves Convergent Research instead. 

We picked Emergent Research because at that time so many important trends were emerging - things like A.I., social media, cloud computing, big data, coworking, the gig economy and others.

But as McKinsey points out, convergences between technologies, social and economic trends have become increasingly powerful drivers of change.  Because of this, we'd likely pick Convergent Research if we were choosing today.  

Getting back to McKinsey's trends report, it's well worth reading if you're interested in technology trends.

Axios on The Rise of "Third Workplaces"

The pandemic has accelerated many work trends. But the dramatic and rapid shift to remote work has probably been the most potent trend impacting the way businesses operate. 

And as is covered in the Axios article The Rise of "Third Workplaces", the shift to remote work is not just a binary choice between your home and your office. 

People can work in many other places, including coworking spaces, libraries, coffee shops, hotels (in the lobby or rooms), private clubs, and even outdoors in parks and other public places.

Of course, the concepts around "the third place" are hardly new.  The term was popularized in the 80's and 90's. 

The idea of a third workplace is also not new. 

If you've walked into a Starbucks over the past decade or so, you know that even pre-pandemic coffee shops were popular workplaces. 

And, of course, the coworking industry was built on the idea that people need 3rd places to work.  

So we laughed when we read in the Axios article implied the third workplace was a new trend and that "There was a small market of remote or hybrid workers seeking out third places before the pandemic,"

Most research on remote work shows that at least a quarter of U.S. workers spent at least some time working in third place locations before the pandemic. That's not a small market.

But we agree with the article that more will do so in the future.

See our coworking section for more on third workplaces.  It's a pretty big section because we've been covering third workplaces for over a decade.

"Hotel on Wheels" #VanLife Firm Cabana Raises $10 Million

Cabana rents custom-built Ford Transit vans that include beds, storage, bathrooms, and Internet access.  Their tagline is "a hotel that travels with you". 

They're hoping to tap into the large and growing number of #Vanlifers. These are digital nomads who travel in vehicles that have been converted into roaming residences. 

In the digital nomad study we collaborated with MBO Partners on, we found 1.9 million Americans describe themselves as VanLifers. 

The LA Times article Shower? Check. Flat-screen TV? Check. Try ‘roughing it’ in a tricked-out camper van covers the growing high-end camper van market.  Key quote:

"The snowballing demand for vans — and recreational vehicles in general — can be traced in part to the COVID-19 pandemic and the desire to stay safe while traveling. Outdoorsy, an RV and camper van rental site, saw a 4,500% increase in bookings in the last year. The RV Industry Assn. estimates record sales of nearly 600,000 units in 2021, including vehicles as long as 50 feet."

According to Geek Wire, "Cabana currently has a 35-van fleet and 15 employees. With the new funding, Cabana wants to add more than 100 vans to its fleet and expand to more cities. It also plans to offer four-person vans that can accommodate more families and small group trips."

Cabana isn't the only van rental business reporting raising money. The above mentioned Outdoorsy recently announced they raised $120 million.  

See our prior post on Outdoorsy for more on the company.

We are forecasting the number of digital nomads - including VanLifers - will continue to increase over the next few years.  The shift to remote work has untethered workers, many of whom are hitting the road.

And some of them will do so in rental vans like the ones from Cabana.

Google Opens a Retail Store

Google opened its first retail store in the trendy Chelsea neighborhood of New York City. 

Google has done pop-up retail stores in the past, and they even considered opening a store on a barge in San Francisco Bay.  But this is their first traditional, long-term retail location.

The timing is interesting in that it makes clear that Google thinks traditional retail is coming back post-pandemic. 

It's also interesting because Google is in many ways the ultimate Internet brand.  So Google following other online brands in opening a retail store shows that hybrid commerce continues to be the preferred path.

According to Fast Company's Google's First Retail Store is the Anti-Apple, Google's store:

"... ends up feeling more like an interactive museum or an exploratorium than a retail store. There’s a wall featuring every single product within the Nest family, with the name of the object underneath, like you might see at a natural history museum. In the middle, there’s furniture designed to mimic a particular room of the house, from the children’s playroom to the kitchen, interspersed with Google hardware. And along the windows, there are 18 “discovery boxes” featuring 3D animations that tell stories about a particular Google product, like the recycled materials that go into the Nest speakers."

Apple, of course, has a highly successful retail chain.  But Microsoft was less successful with their retail store effort.  Last year they announced they would close all 116 of their stores.

So the jury is out as to whether or not Google's experiential retail concept will work.

But Google going into retail shows that while ecommerce continues to grow, even the most ecommercy firms see a future in traditional retail.

The Flying Car Dream Continues

The first flying car prototypes were produced over a century ago.  And yet here we are, 100+ years later and still no flying cars.

But as the New York Times article What is a Flying Car points out, the long term dream of flying cars continues to get closer:

That dream, most experts agree, is a long way from reality. But the idea is gathering steam. Dozens of companies are now building these aircraft, and three recently agreed to go public in deals that value them as high as $6 billion. 

The New York Times likes writing about flying cars.  Just last November, they had another article on flying cars.  

Of course, flying cars have long been popular with the media. 

Our favorite example is Smithsonian Magazine's 1955 article predicting nuclear powered flying cars would be common by 2000.  What could possibly go wrong with lots of nuclear powered flying cars zipping around?

But as we said in our 2017 article Flying Cars May Finally Happen, non-nuclear flying cars may finally take off over the next decade.

But there's still a ways to go. As TechCrunch's The Air Taxi Market Prepares to Take Flight points out, "Electric air mobility is gaining elevation. But there’s going to be some turbulence ahead."

One of the companies covered in the NY Times articles is Kittyhawk.  Their aircraft is shown in the YouTube video below.

CB Insights Creator Economy Map and the Rise of Content Monetization

CB Insights is a technology analyst firm covering emerging technologies and tech startups.  They just released a creator economy market map, which is below (click to enlarge).

CB Insights points out that digital content creators have had to cobble together various tools to build and monetize their activities.  This is quickly changing.  Key quote:

"... a slew of startups are looking to disrupt the way creators make content, develop their audiences, or grow their businesses beyond advertising. Examples include video editing software Kapwing, personalized video app Cameo, and creator credit card startup Karat — companies spanning use cases like content creation, fan interaction monetization, and financing solutions."

We like their map's focus on content monetization, which we see as the biggest challenge for most digital content creation.

In addition to the map, CB Insights produced a spreadsheet with the funding details on about 150 venture backed creator economy startups.  It provides interesting insights on who is investing in what in terms of the creator economy.

The CB Insights map is similar to the creator economy market map released by the VC firm Antler, which we covered last week.  But both have insights the other doesn't have and both are interesting.  

BTW, CB Insights is an excellent source of information on technology and startups.  They also provide a lot of their information for free. 

So if you're interested in technology or startups, you should at least get their free newsletter.

The Swoosh Recovery Continues

Last year early in the recession, there was quite a debate about what shape the U.S. economy pandemic recovery would take. The two candidates that got the most support were a V-shaped recovery and a swoosh-shaped one.

A V-shaped recovery indicated a steep, but very short recession with a quick and robust recovery.

The swoosh-shaped recovery was named after the famous Nike logo. This shape indicates a steep decline followed by a gradual recovery.

As far back as last August it appeared the swoosh recovery was likely.  And the evidence now shows the swoosh is the winner.

The chart below (click to enlarge) is from the Oxford Economics Recovery Tracker, and shows the swoosh pattern.

The chart showing total U.S. non-farm employment *blow) is even more swoosh like.

It seems like one of the lessons from this recession is it's easier to shut down an economy than it is to restart it. 

But the good news is that the economy is clearly recovering.

Mapping the Creator Economy

The venture capital firm Antler recently released The Ultimate Guide to the Creator Economy.

The guide includes the map below (click to enlarge), which shows, by category, "the 220+ platforms that are empowering creators to make an income by doing what they love." 

We like their taxonomy, including their category descriptions:

• Audience curation: The platforms that are enabling creators to build foundational audiences. This allows creators to turn casual fans into super fans. 
• Audience monetization: The platforms that support creators to monetize their audience once they have a following.
• Vertical platforms: The platforms that are niche but potentially mega players. They focus on one vertical area for the creator, such as Fitness or Gaming.
• Community management: The platforms that supports creators to own their audience. 
• Creator tools: These are tools that creators can use to build and grow their businesses.

Each of these areas is described in much more detail, including examples, in the Antler article.  It's well worth reading if you're interested in the creator economy.

Online Platforms Supporting Digital Nomads

Platform Professional's Platforms and Digital Nomads covers online platforms supporting digital nomads. Key quote:

"Platforms may not have created the phenomenon of the digital nomad, but they are making it easier to become one."

The article focuses on the challenges digital nomads face and how platforms help digital nomads overcome them. These include:

• Finding places to stay
• Finding and managing remote work
• Finding unique and exciting travel and cultural experiences
• Avoiding loneliness and finding community

Despite its title, their chart below (click to enlarge) shows 11 platforms that provide services that help digital nomads.

Another interesting article on digital nomads is Work and Wander: What Today’s Digital Nomads Signal for the Future of Travel, from Adventure Travel News. 

It's targeted at the travel industry and how it can better support the needs of digital nomads.  Key quote:

Although digital nomads may not be a traditional target market for adventure businesses, their very nature makes them adventure travelers. This group wants to truly experience a destination by staying for an extended period of time. Their ability to work from anywhere means they are also generating income while they travel. Therefore, attracting digital nomads is one way destinations, accommodations, and activities can support their recovery.

Our first reaction when COVID-19 hit was it would greatly reduce the number of digital nomad.  Instead, their numbers skyrocketed.  

And while we don't expect the growth rate in the number of digital nomads in 2021 to be nearly as strong as 2020, we expect the number of digital nomads to continue to increase over the next 2-3 years.

What are Gigfluencers?

Influencer marketing has become a popular way for companies to promote their brands.  According to Influencer Marketing Hub, brands are expected to spend $13.8 billion on influencer marketing programs in 2021.

As their chart below shows (click to enlarge), influencer marketing spend has been rapidly increasing.

Of course, you can't have influencer marketing programs without influencers.  

These are people who have an online audience that they monetize by getting paid to promote products and services.  

And, according to a recent study by the influencer platform ShopStyle Collective, the pandemic created a new group of influencers they're calling gigfluencers.

Key quote from a Rakutan's Meet the “Gigfluencer,” a new generation of influencer for the work-from-anywhere era:

According to ShopStyle, a Gigfluencer is a U.S.-based influencer — often focused on the retail category (apparel, footwear, beauty and sportswear) — who began monetizing their content for the first time (or re-attempted to monetize their content) around the start of the COVID-19 pandemic lockdown. True to their name, Gigfluencers are more likely to be monetizing their content as a side gig or “side hustle” during the pandemic, viewing their content creation work as a source of supplemental, non-primary income.

We've long covered the growth of side gigs and the growth of low friction, highly flexible supplemental work options - and the rise of gigfluencers is another example.

One-Third of Businesses Surveyed Plan to Increase Their Use of Nonemployee Labor Over the Next 18-24 Months

Deloitte and the MIT Sloan Management Review recently released Workforce Ecosystems: A New Strategic Approach to the Future of Work.   

This research study found that most executives and managers today "consider employees and other workers who create value for the enterprise — including contractors, service providers, gig workers, and even software bots — to be part of their workforce."

They also found about 1/3rd (34%) of the firms surveyed plan to increase their use of external nonemployee labor (freelancers, etc.) over the next 18-24 months.

An interesting study finding is that small businesses are more likely to say they plan on increasing their use of non-employee labor than large corporations.

The chart below uses data from an interactive tool provided as part of the Workforce Ecosystem study.

While interesting, it's not surprising. The use of nonemployee contract labor by SMBs has been rapidly growing for over a decade.

SMBs tend to be more flexible and less bureaucratic around the use of nonemployee labor than bigger corporations.  And so while both large and small firms have been increasing their use of nonemployee labor, SMBs have been doing so at a faster rate.

We expect this trend to continue.

The Long Term Shift to Contract Labor by Small Businesses

Data from the IRS shows that sole proprietor small businesses spent $69.2 billion on contract labor in 2018 (the most recent data available).  Contract labor refers to nonemployee labor, such as freelancers, gig workers, etc.

This is up from $64.8 billion in 2017 and just $34.4 billion in 2010. Over the period from 2010 to 2018, contract labor spend by sole proprietors increased by an annual growth rate of 9.1%.

Spending on salaries and wages grew from $73.7 billion in 2010 to $97.9 billion in 2018, or an annual growth rate of 3.61%.

In other words, spending on contract labor increased at 2.5x the spending on traditional employee salaries and wages from 2010 to 2018.

In 2003, contract labor was about 20% of total labor costs of sole proprietors. By 2010 it had risen to 31%, and in 2018 it reached 41%.

We expect the trend towards contract labor use by small businesses to continue.

Club Med's Top Places for Digital Nomads

The global resort company Club Med recently released a report covering the top countries and places for digital nomads.  

They ranked countries and places by constructing an index based on cost of living, safety, average internet speed, presence of nature and wellness spots, and the number of both relaxing and adventurous activities in each country.

The chart below (click to enlarge) lists their 20 top places, and most will be familiar to digital nomads (we've been to 13 of the 20).  

Thailand was ranked as the top country, with Phuket the #1 place and Krabi the 3rd ranked place.  Although it didn't make the top 20, the hill country city of Chang Mai is another popular Thai digital nomad location.

The report focused on tropical locations, so popular digital nomad places like Berlin and Amsterdam aren't included.  

See the report for more details and descriptions of the top countries and places.

The shift to remote work has untethered workers from their offices.  And many are taking advantage of their newfound freedom and becoming digital nomads.

After the strong growth in the number of digital nomads in 2020, we expect another uptick in their numbers in 2021. 

See our Digital Nomad section for more on this topic.

The Pandemic Increased Interest in Self-Employment

Forerunner Ventures' The universal holding pattern: a period of trial followed by an era of opportunity covers survey work they've done on the impact of the pandemic on consumers.

One of their main findings is the desire for empowerment and independence has increased.  Key quote:

The pandemic offered a taste of independence with remote work for some and a desire to have control over one’s own destiny in a fractured economy for others, making self-employment an increasingly attractive option.

As Forerunner's chart below (click to enlarge) shows, a substantial portion of Americans - and especially those with kids at home - are more interested in working for themselves.

The main reason Forerunner's survey found for the growing interest in self-employment is flexibility.  Again from the article:

"Of the group that wanted to try self-employment, 59% of people said flexibility was the primary factor ... There’s empowerment in self-employment and the independence that comes from owning your own time, traveling when desired, and balancing work and private life ..."

This, of course, is no surprise. 

Flexibility, autonomy and control have long been known as the key reasons people choose to be self-employed.

There's mounting evidence that self-employment in surging in the U.S., and this survey adds to the evidence.

Led by Retail, The Surge in New Business Applications Continues

The new business application surge, which started last summer, continued in April, with about 488,000 applications submitted.  

This data comes from the U.S. Census' Business Formation Statistics and based on IRS Employment Identification Numbers (EIN) applications.  

Most of the applications are what the Census calls "applications other than high propensity" (grey in the chart; click to enlarge).  These are applications from businesses that are unlikely to have employees, such as freelancers, independent contractors and other types of solopreneurs.

The industry with the highest number of applications in April was retail trade, with 96,000 applications.  This is a bit more than twice the rate of retail trade business applications prior to COVID-19.

In addition to the surge, both charts also illustrates the longer-term shift away from shift employer business applications (high propensity applications, in yellow) and towards applications from solopreneurs.

Back in 2003-2007 80% of new retail trade business applications came from firms planning on hiring traditional employees.  In April, only 33% did.  

This same shift to solopreneur firm applications is occurring in most industries.  For example, the shift is even more pronounced in professional services than it is in retail.

At this point it's clear the surge in applications is real. 

But more work needs to be done to understand who the new applicants are, what their plans are, and how many will actually form new small businesses.

Who are "Geriatric Millennials"

Over the past week, there's been a flurry of articles and social media posts on "geriatric millennials".

This term refers to the oldest millennials, those born between 1980 and 1985.  

One of the more popular articles is Today's Are you a 'geriatric millennial'? The new term defining a micro-generation.  Key quote:

It's always been a bit confusing to figure out when Generation X ends and the millennial generation begins — and now a new cohort has emerged between the two groups that has folks in their mid-to-late 30s feeling, well, old.

If you were born in the early 1980s, congratulations! You are now considered a geriatric millennial.

Our favorite article on this topic is Level's satirical 7 Most Telltale Signs That You Are a ‘Geriatric Millennial,’ Ranked.  The picture below is from the article.

Over the past 3-4 years we've found that older millennials are increasingly responding to survey and interview questions in similar ways as their Gen X brothers and sisters.  

Life stage matters and the oldest millennials are now well into middle age.  Because of this, many of their views are evolving.  

The Creator Economy Monetization Features of the Major Social Media Platforms

Axios' Tech giants have all become creator companies covers the various ways digital creators can earn money on a variety of tech platforms, 

Their excellent summary chart is below (click to enlarge).

The article also makes a good point about the diversity of digital creators. Key quote:

Substack creators are writers, while Twitch creators make videos. LinkedIn shares subscription revenue with online course instructors, while YouTube shares ad revenue with everyone from beauty professionals to workout instructors.

It seems almost every day, there's a new announcement around making money as a digital creator. 

For example, as we were writing this article, we heard that YouTube is launching a $100 million fund to attract TikTok creators to its Shorts product.

Since a key issue facing the creator economy is the vast majority of digital creators make very little money, the growing number of monetization options is good news.