⚡ Get All Content for 20% Off ⚡

The Unasked Question: Should You Open a Business? Entrepreneurship can be an expensive and thankless 24/7 endeavor that few people wind-up succeeding at. See if you're ready.

By Carol Tice

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

The Unasked Question: Should You Open a Business?There's been a lot of cheerleading for entrepreneurship the past couple of years. Many people laid off from corporate America have plunged into starting their own businesses -- driving the start-up rate to its 15-year high.

But is that necessarily a good thing? No-nonsense business advisor Carol Roth says not really. The downturn is prompting many people to start businesses, she asserts, who probably could save a lot of money and aggravation if they just skipped it.

In her new book, The Entrepreneur Equation -- Evaluating the Realities, Risks, and Rewards of Having Your Own Business, Roth asks the question that is the 500-pound elephant in the room of most entrepreneurship discussions since the downturn: Should you start a business?

Historically, the vast majority of startups end in failure. Unemployed people starting businesses now out of desperation because they can't find a job will likely fare even worse, as many just aren't cut out for entrepreneurial life, Roth says. She's hoping her book can help guide would-be entrepreneurs into better business decisions -- because if we can improve the success rate of entrepreneurs, it would really ignite the economy.

"We can't have entrepreneurship be the engine that drives our country if nine out of ten people don't succeed at it," she notes.

One common flub is deciding to turn a personal passion or hobby into a business, without considering how that will change your relationship to the activity. Not every hobby should be your full-time activity, Roth says. Try to work in the type of business that interests you before you take the leap to see if you'd really like it.

"I had a woman in financial services working for a major Wall Street firm tell me, 'I'm passionate about healthy fast food, so I want to open a Subway franchise,'" Roth relates. "I said, 'That's nice. Go work nights and weekends in a Subway franchise and see if you like it.' A few weeks later she came back to me and said, 'If I never see another $5 foot-long in my life, that'd be fine. You just saved me from wasting a six-figure investment.'"

Too many people are plunging into entrepreneurship without assessing their skills, Roth says. Do you have management experience? Work well with others? Are you really ready for the 24/7 responsibility of launching a new enterprise?

Besides taking a hard look at your abilities, personality type is another factor to consider, Roth says. The perpetually broke will have a tough time getting a business off the ground, as will those with poor money-management skills and those who are too risk-averse.

What makes you cut out to be a business owner? Leave a comment and tell us your strengths.

Carol Tice

Owner of Make a Living Writing

Longtime Seattle business writer Carol Tice has written for Entrepreneur, Forbes, Delta Sky and many more. She writes the award-winning Make a Living Writing blog. Her new ebook for Oberlo is Crowdfunding for Entrepreneurs.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

The Remote Side Hustle a 43-Year-Old Musician Works on for 1 Hour a Day Earns Nearly $3,000 a Month: 'All From the Comfort of Home'

Sam Ziegler wanted to supplement his income as a professional drummer — then his tech skills and desire to help people came together.

Business News

AI Is Impacting Jobs. Here Are the Gigs Affected the Most, According to an Analysis of 5 Million Upwork Postings

The researcher said in the report that freelance jobs were analyzed first because that market will likely see AI's immediate impact.

Leadership

Former Interrogator Shares 5 Behaviors Liars Exhibit and How to Handle Them

Five deceptive behaviors to look for and how to respond to those behaviors when you encounter them.

Money & Finance

4 Promising Industries Investors Should Be Watching in 2024

Wondering whether your industry is on the decline or set to expand? Read on for these predictions on the best sectors for growth in 2024.