Since being an entrepreneur has become fashionable, and we see articles and social media content about them all the time, it sometimes sounds like starting a business — especially one you will rely on to support yourself and your loved ones — is easy.
But, it is serious business that fuels job growth, sustains and grows the economy, and is the embodiment of the American dream.
While discussing a non-profit I founded, I was reminded of a common misconception about setting out on your own. The reality is, I spent my own money to buy some of the things needed to open the doors, didn’t take a salary for a while, and paid for things we needed. My salary, when it did occur, fluctuated with cash flow. This was my choice however many times I was told ‘well it’s an investment’. In good karma? Yes. In a nest egg? There is no profit by definition!
Anyone who has given up a paying job to take the risk of starting their own business, especially in a STEM-based field, is in a similar situation: Not only are they putting money into their startup, but they are usually drawing money from their savings, and not getting paid. This can be significant and take years to recover from — if at all.
Often the most successful startups are the ones that spend time building their network and their visibility into resources that can help mitigate some of the expense.
This can include identifying grants that might be appropriate, like the Small Business Innovation Research funding or grants provided by local municipalities, or organizations, including institutions of higher education, that can connect you with mentors and advisors, to large corporations that have special software licenses for companies under a certain size. Tools for distribution of software applications or open-source licenses. The cost of applying for a patent.
There is freeware, shareware, or even high-end physical tools that can be used, such as those offered by UMass Core Research Facilities, or a local makerspace or incubator.
Startups are stressed. Government agencies and necessary professional services already impose a lot of administrative overhead just to launch and form an LLC or other corporate structure, establish a bank account, set up payroll/taxes for employees, file taxes, set up founders’ agreements, sign contracts for a facility, etc.
So, my plea to elected officials and candidates for political office is this: I implore you to keep the realities of launching a new business venture in mind as you make decisions in Boston or Washington. Risk-takers and innovators move society forward and shouldn’t have to shoulder the unintended consequences of less-than-careful policymaking.
Any bill or action under debate in the halls of Congress or on Beacon Hill should take into account the impact on entrepreneurs and the next generation of technological pioneers.
Lawmakers, governors, agency heads, and attorneys general, please ask yourself if a policy makes starting a company easier or harder before you cast your vote.
Barbara Finer is a serial entrepreneur and a some-time professor of marketing and entrepreneurship. She tithes her time mentoring startups locally.