[a new breed of entrepreneur emerges from the economic dust]

In decades past, folks started businesses as family companies. They provided jobs to their community and family members. They figured they’d eventually retire from the business and pass it onto whichever child or children wanted to take it over. It was a grand venture.

By contrast, many of today's entrepreneurs are displaced workers who are heads of their household and are just trying to make enough of a living to support their families. They are fully trained professionals who are unwilling and unable to wait for the economy to spring back and provide jobs for them.

As a result, more new businesses are taking the form of consultancies rather than full fledged businesses. This makes for a myriad of changes to the market place.

More Competitive Pricing
Firstly, due to extremely low overhead, this new breed of entrepreneur can offer services at lower prices, even though their skills are usually on par with their competition since they received formal training by their former employers. They are no less qualified, simply able to provide a lower price point.

No more 9 to 5
Business hours for these entrepreneurs extend far into the evening, with after dinner meetings for clarifying contracting details and checking work progress. These meetings are being held in local coffee houses and fast food establishments. One beautiful consequence is that there is more opportunity for family and personal time to be scheduled around work loads and client appointments.  (Our families could use a bit more focus these days, don't you think?)

Fewer Employees / More Subcontractors
You’ll also notice there are far fewer employees of today’s entrepreneur. These businesses are not looking to hire folks so much as they are subcontracting work to other contractor consultants. Let's face it - it's much easier to farm work out to another contractor than it is to have and hold employees. There are:

  • far fewer fair labor regulations (mandatory breaks, family/medical leaves, etc.)

  • less liability

  • fewer taxes and quarterly paperwork

  • no payroll services/software needed

  • much less time spent finding a contractor versus hiring and training employees

  • no need to worry about the difficulties or legalities associated with firing someone

  • no matching social security payments to the government

  • no worrying about what kind of health benefits we’ll be required to provide

Higher Work Ethics
And, perhaps the most pleasing shift from employees to subcontractors is that when you are no longer satisfied with a contractor’s services, you simply farm the work out to another subcontractor.

The glory in this is that it keeps the contractors' standard of work at a competitive level. Slacking off and delivering sub par quality of work is directly rewarded with being replaced. (i.e. read: "No more FaceBooking all day long while no one is looking!")  Conversely, exceptional service is rewarded with additional contracts.

What a novel idea! No more glass ceilings or nepotism within a company to circumnavigate. Survival of the fittest now involves a shift in work ethics which, let’s be honest, have been steadily decreasing with each new generation of workers.

Increased Value in Networking Organizations
Because consultants can’t perform every facet of their businesses alone and are required to find qualified contractors, the art of networking will become even more important. There will be more questions like “Do you know someone who does this particular service?” and “Have you ever worked with XYZ Company before?” asked of one another. Peer reviews will become the new “references upon request.” And online social networking services such as LinkedIn will become invaluable as we switch from needing resumes to requiring testimonials.

Distribution of Wealth
So, as more displaced workers are starting consultancy businesses, we’re seeing a more even distribution of wealth. While the every consultant/entrepreneur dreams of “making it big”, typically they make the same matter of living that they made as an employee. More clever entrepreneurs find ways of claiming more income for themselves. However, mostly these consultants are highly skilled at their trade, but lack an imaginative business sense to excel to ridiculous heights.  "Small Businesses" can no longer be qualified as those making $3 to $30 million.  Today's "small business" may make as little as $30 thousand in a year, but they are no less valuable to the market place.

Oh, sure. There will still be the garage ventures which go big in a matter of years, hiring half of their communities, earning every possible new-business-of-the-year award and eventually selling out to Fortune 500 companies. But more common today are the entrepreneurs who are learning as they go, reinventing and redefining along the way, who are bringing us back to the grass roots of self-employment. And that’s not all bad.



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