What Entrepreneurship?
FT has an interesting Lex column today about US employment. Two things about entrepreneurship in particular stood out:
- “Since 1977 about 700,000 new businesses have been started in the US every year. The number barely changes from year to year.”
- “A ballooning in both venture capital funding and university courses on entrepreneurship since 1980 has had no effect on the rate of business formation.”
Wouldn’t have guessed that.
Hi, I'm 
Ouch. Because these stats are quite gloomy I’m curious to know other parameters like lifetime of new businesses or growth rates over the last 33 years.
The Kaufmann Foundation has lots of fun entrepreneur stats.
Mostly VC and uni courses have no effect on entrepreneurship because entrepreneurship counts people starting home businesses, coffee shops, law firms, dentists, etc, etc.
None of those require VC funding or university level courses. The type of businesses you may be thinking of account for a tiny portion of the raw number of new businesses started.
Cheers,
Tristan
The FT Lex column is based on a study whose most recents stats are from 2005 with some even from 1995, another world entirely. Source document is here: http://www.kauffman.org/uploadedFiles/exploring_firm_formation_1-13-10.pdf
The Kauffman foundation has a more recent index of activity here: Despite Recession, U.S. Entrepreneurial Activity Rises in 2009 to Highest Rate in 14 Years, Kauffman Study Shows http://shar.es/meaOV
You may want to take a closer look at the Kauffman Foundation study that this FT article is based upon. Its statistics are from 2005 with some coming from 1995, another world entirely.
The Kauffman foundation has a more recent index of activity here: Despite Recession, U.S. Entrepreneurial Activity Rises in 2009 to Highest Rate in 14 Years, Kauffman Study Shows http://shar.es/meaOV
I agree with Tristan, VC is relevant to a tiny percentage of businesses. Even within technology companies they are looking at a minority, i.e., those that may develop a ‘killer app’ and deliver huge ROI. A company that provides consulting services, for example, doing contracted research, can be profitable year after year and never attract VC. I’m not complaining, that’s just reality.
As for entrepeneurship courses – coincidentally, I received an MBA in 1980. The courses on accounting and business law were particularly helpful as I started a business. With 20 years experience now, I can’t think that a specific program for entrepeneurs would have been more helpful than the regular MBA program.