Real success isn’t always exciting
Exciting, high-profile businesses -- or businesses that at least seem that way -- get all the press, and lots of people dive into entrepreneurship because they are either mesmerized by spectacular startup lightning strikes like Facebook's $19 billion acquisition of WhatsApp, or simply because they dream of going into what appears to be a glamorous line of work.
But in reality, most wealth isn't built by overnight dotcom billionaires, next-huge-thing inventors, famous chefs or other high-profile winners. It's built by small business owners doing comparatively unexciting things.
The media paints a warped picture of entrepreneurship and wealth, focusing on businesses that beat Powerball-like odds. Even something as relatively mundane as eating in a nice restaurant can create delusions of the glamorous business life of an impresario (ask almost anyone who's been in the restaurant business how glamorous it really is). So if you're thinking of striking out on your own, it's important to have a down-to-earth understanding of where real (or, better put, realistic) money is likely to be made, and overlay onto that your own plans, aspirations, resources and guts.
By far, most of the truly financially successful business owners I have ever met do things that wouldn't light up a dinner conversation. Setting aside typically well-paying professions like medicine and law, the real wealth-builders mold parts, make cardboard boxes, rent property, bend sheet metal, operate franchise chains, run distribution companies. Most have businesses you've never heard of, with few enough employees that they can still credibly refer to the company as a "family."
The stats bear that out: In the U.S., small businesses account for roughly half or more of GDP, as well as the highest percentage of new jobs and overall jobs. But the detailed figures are more telling. Using Small Business Administration information and census data to break down the numbers further, there are about 23 million small businesses that don't have employees, and about 6 million that do. Of that number, about 90 percent have 30 or fewer employees, and a similar percentage of these firms have sales of $2.5 million or less.
Based on individual net worth, millionaires in the country number between five and seven million -- and around half of them are small business owners. Around the world, meanwhile, entrepreneurship and business ownership are indeed the most common and most likely sources of wealth.
If your ultimate goal is to make as much money as possible, think you are onto something big and are prepared to take the all-or-nothing risks that usually entails, go for it. If you want to own a restaurant because your lifelong dream is to own a restaurant, and you know what you're getting into, chase your dream.
But if, like the vast majority of business owners, your goal is to have a good shot at building enough wealth and independence to do what you want with your life (granted, everyone has a different definition of that), don't ignore "boring." Think of businesses that meet real needs, carve niches, serve vertical markets or provide a service better than the established local competition.
None of this is meant to shoot down grand visions, or to suggest that no one should shoot for the stars -- clearly, people with big ideas, big ambition, an ability to execute at an extraordinary level and high risk tolerance can and should go for their golden rings. If you've got the next Google, Facebook, Tesla or WhatsApp, more power to you. Someone has to be one of those 0.00000001 percent who make the billionaire's club, right?