Has the Great Recession made you a better entrepreneur? Most small business owners say “Yes,” according to a new small business generational study by American Express OPEN. A whopping 81 percent of Gen Y and 80 percent of Baby Boomer entrepreneurs say they’ve gained new skills by successfully steering their companies through the recession, the OPEN Ages study reports.
Dealing with the recession forced entrepreneurs to become more creative in their marketing (50 percent of Gen Y/Millennials and 40 percent of Baby Boomers) and to improve their financial management (83 percent of Gen Y and 77 percent of Baby Boomers). As a result, Gen Y-owned small businesses have experienced 24 percent revenue growth in the past three years, while Baby Boomers have seen growth of 10 percent.
Baby Boomers seem to be handling the recession’s aftermath a little better than Gen Y—maybe because they’ve already been through several economic downturns and have more experience in getting through them. In fact, Boomers are feeling comfortable enough to ease up on their growth plans and focus on work-life balance. Less than half of Boomers say growth is the top priority for their businesses (47 percent vs. 66 percent for Gen Y). Instead, they are working an hour less per day (9 hours per day vs. 10 in 2007), cutting back on caffeine (2 beverages per day, down from 3 in 2007) and making fun a priority in their businesses (73 percent up from 66 percent in 2007).
Generation Y and the Boomers have different motivations for business ownership. The primary reason Gen Y became entrepreneurs was to do something they are passionate about (26 percent). For Baby Boomers, however, the motivation was a tie between being their own bosses and making money (each 28 percent). Both generations are satisfied: Gen Y says doing what they’re passionate about is what makes them happiest (56 percent), while Baby Boomers say that being independent is what makes them happiest (64 percent).
However, though younger entrepreneurs are typically seen as risktakers, Gen Y is becoming a bit more cautious in the recession’s aftermath. Today, just 56 percent say they like taking risks (down from 72 percent in 2007), and just 16 percent are launching businesses straight out of school (down from 28 percent in 2007).
Is this a good thing or a bad thing? Passion tempered with caution can be a great instigator for starting a business—as long as your caution doesn’t slow you down too much.
Is your business still struggling to get out from under the effects of the recession? Or are you charged with enthusiasm and ready to grow? Maybe you’re getting ready to pull back from your business and put it up for sale so you can enjoy the fruits of your labor. Whichever situation you’re in, some expert advice could help. Visit www.score.org to get matched with a SCORE mentor who can help.