0:01 foreign good afternoon and welcome to the way to wow people making money I'm your host Kevin demmel thank you very much for joining me this afternoon I before I get going with today's show I wanted to mention my guests from last week Carl Savino of corporate gray so Carl
0:37 excuse me after um getting out of the army uh back in 1992 um Carl um got into civilian life and after a few years he started corporate gray and for over 25 years now he has been helping service members and their family members transition from military to civilian life and we talked about a number of issues related to job hunting and even if you are not a member of the military which I imagine a number of you
1:13 are not if you're a recent college graduate or you're a mid-career professional needing to make a change I think you will find Carl's um insights and advice uh very useful so I invite you to go to our YouTube channel the way to wow show and watch Carl's episode and and as always if you have any questions or thoughts feel free to drop them into the comments or uh there are uh the link to Carl's website is there my email address is there so feel
1:48 free to reach out and we are happy to help you so today our topic is is this a good time for a job change or to start a business so it's it's a um somewhat unusual Economic Times on the one hand um employment is um almost as tight as we've ever seen it um the unemployment rate I believe is about 3.8 percent overall and there are
2:24 over 11 million job openings uh without people to fill them which you would typically see when the economy is expanding or at least when it's uh you know kind of at its at its top um on the other hand we're seeing um very high inflation um well um very high we're seeing High inflation um I I believe uh you know it's it's averaging over eight percent uh uh year over year
2:59 um and uh the FED uh just today um announced another three-quarter percent increase in the discount rate so now the target rate is three to three and a quarter percent and that's designed to slow the economy down in order to get inflation under control and indeed we are seeing signs of slowing in um in certain sectors retail is seeing a buildup of inventories despite the fact that there are still some supply chain disruptions Etc on the other hand
3:35 um you know Energy prices have gone way up and as we head into winter um there's a lot of uncertainty over whether there will be enough energy to heat homes and and and to keep uh industrial production going so you know a lot of mixed signals the the the stock market tends to be up and down although overall this year it's down so you know what is what does all that mean to us as an as an individual you know there's there's the uh the old expression
4:10 um a recession is when my friend loses his job but depression is when I lose my job right um and I look you know tongue-in-cheek obviously those are not official official definitions but there is some truth to you know to to that that idea so you know what should we you know hang on to the job we've got should should we put off those plans to start a business or or not so um I have a few um thoughts and and and some information
4:45 to share with you that uh hopefully will help you make a better decision at least a more informed decision so before I get to the the different uh infographics and such I I I I do want to say the following for those of you who have ever gotten an email from me in the last couple of years you know that I sign my emails courage at all times and in fact I have a a good friend who whenever we talk about things and and we're partying um he'll always feel like courage at all
5:20 times you know and and uh you know because I'm the one who's who I guess made that up I I I I don't know if I made it up but I'm I started among those of us who you know know me I'm the one who started using that as kind of his you know instead of sincerely so I encourage you to not make decisions out of fear because in the end fear always says don't do this and there's always things to be afraid of
5:58 that's just the nature of life so there's we could always come up for reason with reasons for not doing something this this happened to a a good friend of mine not too long ago he had a wonderful opportunity to to really kind of a Capstone to his professional career and he ended up not taking it and it really disappointed him and the the reason he didn't take it was related to fear and and that's a shame
6:34 um I think we have to work to come over to overcome our fears to come over our fears uh to overcome our fears and uh I think I've mentioned this before my friend uh Bob Sanders uh who um is actually going to be on the show again in a few weeks um you'll you'll hear the exciting things that he's doing based on his philosophy which is just say yes and you know we live in this you know just say no kind of outgrowth I think from the 1980s you know just so you know to drugs
7:10 probably the right you know thing to do especially now with things like Fentanyl and all this stuff around right just just say no to drugs I guess overall um I I don't mean this to be a political thing I'm just say that's where it comes from in many other areas of life the best policy is to just say yes and good things oftentimes happen now sometimes there's pain in the interim as we figure out something new it can be very very difficult we can feel like
7:45 we've gotten in over our heads we're you know drowning at one time two times three times down I'll help you know that kind of thing but if we're willing to sort of take that leap off the pier oftentimes will realize that what's ahead of us is actually much better than what we left behind after we get through that that that that struggle that oftentimes accompanies doing something new so you know you'll you know my bias now in case you hadn't you know guessed it
8:21 before having said that we don't want to be completely imprudent so uh you know the reality is I should not at my age at my height you know embark on you know professional sports career I should not embark on any kind of sports career unless I'm going to be playing left out so we don't want to be completely you know ridiculous in the decisions we make but that doesn't mean that that in between fear and completely ridiculous there's
8:57 there's nothing there there's a whole range of options there and these are the options that we need to think about okay so I want to share something with you related to the uh the job market here it is so we've heard a lot recently oops let's see wait what is okay there we go all right now we got it and here let's uh
9:33 let's put this into slide mode it'll be a little bit bigger and easier to see and here we go play from the start is that going to work maybe not it's the wheel of death is is spinning okay well I'll proceed and then maybe it'll magically you know get get larger so we hear a lot about the Great Recession I met there we go uh we we've heard a lot of in fact I mentioned it just a few minutes ago that um uh that uh um they're the uh the total unemployment
10:09 rate is 3.8 that's that's pretty low um probably by any standard is is what's called Full Employment by accountants I'm not by accountants I mean by uh economists meaning that um uh you know there aren't a lot there there isn't uh there aren't people around hoping and you know that they're going to get a job Indeed people who want a job have a job um and there's over oops I'll see there you go I clicked it um and and there are over 11 million positions uh that are that are you know
10:44 are are not filled so but let's look at this in a little more granularity okay where really is the opportunity today in terms of jobs so let's start here where is the largest unemployment rate and that's in Agricultural and related uh type of of work so 6.7 percent so not quite double the overall double be 7.6 so this is the 6.7 but the highest segment of the the
11:20 highest yes segment of the economy is agriculture followed pretty closely behind by Leisure and Hospitality now that shouldn't come as any surprise Leisure and Hospitality where one of the heart was one of the hardest hit Industries uh when when the whole covid um situation started and a lot of people when they after they got you know laid off or fire whatever whatever you want to call it they made the decision I'm not going back
11:55 it's it's it's tough work uh it's it's relatively low paying work especially if you're a server or if you're a housekeeper something like that and the you know hospitality industry has not been able to recover the employment the employees uh that they lost uh you know starting about two years ago uh and so you see things like them and not cleaning rooms every day now at a hotel and you see them struggling for people to who for you know waitresses and waiters and and
12:31 and people uh on the kitchen staff Etc it's it they're struggling to fill people as as are you know restaurants Etc they're struggling for uh for wait staff so now notice by the way that in both of these these are relatively low paying segments of the economy they just are so the fact is people seem to feel that they don't need to take a low paying job and and the numbers bear it
13:06 out because there's less than four percent unemployment right on the other hand if you're if you're in a job that you don't like it's too high pressure or something or or you want to do something that you perceive as being more interesting more fun maybe more involvement with people so look there's a lot of opportunity in the Leisure and Hospitality sector you're not going to have the difficult time probably getting a job there and and so um you know it it there's no no doubt that this is a superb time if you want to go to work in that area and and by
13:42 the way so if you're recently out of college let's see well we're what are we we're yeah I guess we'd be starting college right now but um let's say you got out of college last year and you haven't been able to find the the career that you want to get into so you know there's opportunity in the Leisure and Hospitality you may have to start at the bottom but the reality is there's room for growth in the hospitality industry so if that's something you think you might enjoy you've got an opportunity to jump in and see what it's really like right there's nothing like being involved in an industry to really understand what it's
14:18 like all of the sort of uh well my my friends and I used to talk about the glamor of show business I'm sure you've heard of the glamor of show business right go hang out on a movie set for about a day and you'll see about how glamorous it is it is at times mind-numbingly boring to be on a movie set it it just is it's it's nothing like the way the business is portrayed which isn't to say that therefore being in the entertainment business is is terrible and and you don't want to do it it's only to recognize the reality of being
14:53 in it is significantly different than the way it's portrayed and the same is true of almost every industry right so let's look at some of the other ones um so Transportation utilities uh down 4.3 percent um I know I see on the buses here in Los Angeles you know they're looking for drivers I think they're looking for you know truck drivers um and truck driving can pay pretty well for example um at all but it means you know being on the road a lot so and again I think a lot of people a lot of truck drivers
15:28 um when you know when covet hit and and they were they were not needed I think they kind of said I'm done and then pretty quickly we realized we needed all these guys back um and some of them just aren't coming back so that's probably why there's a link you know lingering uh unemployment that's higher uh than the overall unemployment in in transportation utilities um construction and and is is at just about the the overall on and uh you know construction has been booming I think almost everywhere now as interest rates go up we may see
16:03 construction moderating um but relatively speaking it looks like there's you know pretty good opportunity in construction Okay Wholesale and Retail trade here's another area that was decimated during covid so people working in retail businesses with clothing or uh you know grocery stores Etc um you know well grocery stores I take that back they they they kept their people because they were essential workers um but but clothing um I'm trying to do jewelry um all you know all of these other types
16:38 of retail businesses a lot of them you know laid off all their people and now they're struggling to get them back they they you know people again for especially at the entry level retail is a fairly low paying um uh industry and so people don't want to come back it's it's really tough you know I um um became friends with some some folks at a retail shop down the street from from where I go to work out with my uh trainer and I I would see them almost every week sometimes more than once a
17:13 week I used to bring them chocolate and they're like why are you doing this and I said because he tells a tough business you know and I I I would be in the store and and people would treat them so badly it's like you know they're they're not your hired help and by the way why would you treat your hired help like this you know in any event these are human beings right people seem to feel that I don't know it's not important to to treat people working in a retail store for that matter in a restaurant uh with with decency I I take big exception to that
17:51 um but for people who work in that industry after a while it's like I don't want to do this anymore right and and I can understand why because when you see the way they're treated a lot of people unfortunately just don't treat them very well so um on the other hand if you really love clothing or I don't know sunglasses or you know jewelry or whatever so that you know like like I was saying with you know hospitality and Leisure most people get into those businesses they start at in these you know entry
18:28 level positions so I have a friend whose daughter um is now a buyer for one of the national uh clothing chains um she started out work in retail and I I believe it was the sunglasses hut um and it was a real I think it was a real eye-opener for her and she saw how you know how what what hard work it was she also saw how the public reacted to um the the various Goods that that were being sold all of that was important for her to learn as she Advanced up the ranks so that now that she's a buyer she
19:05 has a much better a much more informed um uh base from which to be making her decisions so if that's something that you aspire to well you know we all have to pay our dues or most of us do unless we've you know got a parent who's got a very successful business who's gonna you know put a start us out at a high level and and you know a lot of parents are not going to do that because they realize that we we need to learn as well so so in any event there's there is opportunity in wholesale and Retail trade as well so
19:40 um right behind that is professional and business services so these are things I I imagine like accounting law etc etc so uh there there is uh opportunities Fields now in this case most people who are going into accounting and law they're going to have you know a law degree they're going to have an accounting degree Etc um having said that there's lots of programs around uh for for you to get a degree like that if that's what you want to do um now I hasten to add that lawyers for example
20:16 um a lot well a lot let me let me rephrase that some of the legal business is now getting shipped overseas and so people in for example India who have very good English skills work is being farmed out to them the sort of basic document drawing up and that kind of thing because it's much less expensive and we saw that with remote work people don't have to be in the office in fact they don't necessarily even have to be in the same country so um you know if in any of these Professional Services I think the key
20:53 going forward is going to be a couple things the keys going forward I should use plural one is a high level of knowledge and and and and and that's you know some of that comes from working you know in the industry and the other is the ability to attract business and the reality is in the professional and business services Realm the most successful people were always what they call the rainmakers right the ones who can who can bring in the clients so if
21:29 that is something that you enjoy maybe you you know you like the idea of being a lawyer but you sure don't want to be you know drafting documents for the next 30 Years but you really enjoy talking to people helping them solve the problems they have learning about their businesses Etc so that's you know that's a large part especially if you're at a big firm um that's a large part of how you advance right um and it is the case that it's it's tougher and tougher to be a sole practitioner be at a small firm in the in the professional business services so um
22:04 you know that's that's something to think about uh other services to be honest I'm not really sure what that is I'm going to skip that so now now let's we're looking at the things that are you know significantly or starting to be significantly lower unemployment than uh than the overall unemployment so manufacturing right three point three percent a half a percent lower than the overall so one of the things that's going on in in the United States is what they're calling reassuring right the decoupling of manufacturing from um primarily China
22:40 um because of the uh you know International scene that's going on so it's likely that we'll see a growth in manufacturing and especially in certain types of Technologies so there's a number of companies that are building um large uh uh uh electric vehicle battery manufacturing plants um there's all kinds of subsidies now for all kinds of green main type manufacturing Industries so a lot of that money is tied to the manufacturing being done here in the United States so if if you're someone
23:16 who doesn't like office work and I know that's a lot of us um even for people who have college degrees and don't necessarily want to be stuck in an office all day long or stuck in front of a computer terminal all day long so manufacturing may be a great opportunity and even though the unemployment rate in manufacturing is a little bit lower than the overall unemployment rate still I think there's opportunity and it would seem to me that there's opportunity opportunity is going to be growing going forward and so even though right now maybe there's some some you know uncertainty in the economy
23:52 still as we move forward I think there is you know opportunity there um and and that's I think you can make a similar case for information education and Health Services so there's information would be uh I I think that would be things like uh you know technology and and that sort of thing so um you know on the one hand there are technology jobs out there on the other hand uh a lot of their technology companies are shrinking their workforces so I read
24:27 oh no that was a technology sorry that was that was uh that was uh clothing um Gap is is laying off 500 people um in their uh uh in their corporate headquarters or at the corporate at the corporate level anyway um but I I will say that um there is job opportunities in technology um they are not as easy to find as one would think given the you know great resignation so um I know a very highly Highly Educated uh person who struggled for months and
25:04 months and months and months and uh to be honest I've lost track of the person so I don't know how that job hunt ended up um but I know it went on for well over a year um and I do know from friends who are in that business layoffs are not uncommon um so I I you know if if you have good contacts and you have certain skills um whether it's you know data science things like that you're probably still in in hot demand um especially if you're experienced if you're new to the business I think you have to be prepared for uh you know a
25:41 you know perhaps a bit of a tough job hunt um because you can see you know again like manufacturing it's it's a half a percent uh below the overall um but there is a retrenching going on in in information and Technology um that um is is perhaps a little bit different than what we're seeing going on in manufacturing okay now with respect to education and Health Services so um there is a a lot of school districts are looking to hire teachers okay there
26:18 is a shortage of teachers in quite a number quite a number of them um there are a lot of people who um have have left teaching for various reasons um look teaching is is a difficult job um you know if you don't have kids in school um so you may not be you know familiar with what goes on these days but I can assure you um as a as a father of a of a daughter who started High School this year I've talked to the one of the co-princibles of her school I've talked to some of the assistant principals I've spoke to the
26:54 athletic director for the district um the the the the women who uh um run the PTSA I mean it is tough education is tough and so uh a lot of them and I've spoken to a lot of teachers as well I might add um there's a lot of Demands on them and you know it wasn't like when I went to school where the you know the teacher could walk into a room pretty much expect that students would be well behaved properly fed prepared for the day's learning and and you know sort of off we go um that is not necessarily the case
27:29 these days even in so-called you know good school districts or districts in you know fairly wealthy areas um my my daughter goes to um uh Beverly Hills High School um and um look there's there's challenges there um people say well that goes on at Beverly Hills yeah yeah it does I mean okay I mean different problems perhaps than you have at other schools but doesn't matter there's challenges to the education industry today and and it's really got to be something thing I think
28:05 that that someone wants to do they've got to be doing it for for more than just money even though teachers are pretty well paid these days now Health Care Services you know not a lot of layoffs there well not really any layoffs there you know because of Kobe quite the opposite um but a lot of burnout I mean a lot of people in the healthcare business it's been a rough three years uh two years two and a half years whatever it's been and and so you know um while again there's opportunity and it's probably going to continue to grow as as Baby Boomers like me get older and
28:42 we consume more Health Care Services still there are challenges there and of course it takes education to be for the most part to be in the healthcare business uh the healthcare industry I should say so um you know that's that's something to keep in mind okay government workers um unemployment is 2.8 percent uh okay fine um self-employed workers unincorporated or unpaid family workers 2.6 percent right so um is there opportunity there uh you know well if you're going to be
29:17 self-employed you don't have to worry about um whether you're unemployed or not because if you're if you decide to be self-employed we're going to talk about that a little bit later so I'm not going to spend any time on that so mining quarrying oil and gas extraction right um you know given the state of where energy is at you would think that you know this would be booming and I guess it is in the sense that uh unemployment is is pretty low um is there going to be more opportunity going forward I think that's you know that's that's a difficult question to answer that's partly a political question I don't want to I don't want to
29:52 get into the politics of it uh we are at a a situation where um uh you know I I think um you know for example Europe um they are rethinking their overall or countries in Europe I should say are rethinking their overall energy production so will that lead to um a greater number of people being employed in the energy sector here in the in the United States uh that that I I don't know I I can't predict that having said that um you know the for the most part these
30:27 are pretty good paying jobs and if that again if that's something that that interests you especially if you you know you you want to be working on you know big machinery and that kind of thing so that may be something to look at and then finally Financial activities look at this under two percent unemployment in financial activities so that real estate Financial Services those kind of things having said that as low as that rate is if you want to get into Financial Services um you can um virtually every firm out there well
31:03 not every not every firm but a lot of firms out there if if you want to be in if you want to work in this industry or those Industries you'll be able to and there's a good reason why it's because for the most part they don't pay salaries so you know you you are in many ways self-employed uh working for real estate companies working for Insurance and financial service companies uh they they in some cases will pay for you to get trained pay for you in the sense that they'll pay for the classes they may even pay for you to get the licenses
31:40 um but you're not going to get a salary that you know you get a check every two weeks or twice a month or whatever so your income is going to be based on your production now there are a lot of great companies out there um that that you can look at in those sectors uh I have a friend who has been very successful with exp Realty probably the the most um Dynamic uh real estate company in the United States right now because of how their compensation plans work including once you get to a certain amount of productivity you'll get stock in the country company et cetera et
32:15 cetera there are financial services companies I know I have a friend who is is uh he's a regional vice president with Primerica and they have an excellent excellent I mean really outstanding training program that is a company by the way that they they will pay for your uh your training courses they will pay for your licenses um and then you know they will they will help you all along the way so if you are interested in financial services although the unemployment rate is pretty
32:50 low um still there's there's lots of opportunity there so what is this saying in total well notwithstanding that unemployment is you know fairly low by historic standards still if if if you're thinking about changing your job um or or starting a different career there is opportunity out there okay keep in mind as low as these numbers are there's over 11 million jobs that need to be filled now a lot of those jobs are
33:27 centered in industries that are lowering lower paying like we said up here agriculture Leisure Hospitality wholesale trade wholesale and Retail Trade A lot of them are in those areas however there's room for growth in all of those Industries so you may start out at a you know not a particularly uh you know attractive uh salary level but you know if you work hard and and and learn your company systems they'll there's definitely opportunity there and even for Industries where the unemployment
34:03 rate is lower than the overall there is still opportunity in those Industries Healthcare is one of them um teaching is is another so you know 3.1 percent unemployment rate um now by the way one of the reasons why the unemployment rate is so low is because the percentage of the population that is either working or actively engaged in looking for work is also lower than it was pre-pandemic so this has to do with the technicalities of how
34:38 the unemployment rate is determined if people have given up looking for work they are no longer included in the unemployment rate okay so um the the overall employment level the percentage of people working um of the working age population is still down and so that's one of the things contributing to a lot of uh job openings that aren't filled so all in all and and I I you know I told you my bias when we started but as I look at this information right here I think this
35:13 shows pretty clearly that there's there's opportunity out there for for various different reasons as we looked at each of these uh industry sectors to to be optimistic about getting involved with them okay so now before we switch off this slide I want to also have you look at something else because we're going to switch over now to is it a good time to start a business okay so as you look at this chart and you see where
35:48 um unemployment is the highest it also happens to be where you know in some of these lower paying uh segments of the economy okay um and um uh what was it gonna say oh so these are also the areas that are struggling to find people Okay so there is potentially a business opportunity there if you can come up with a solution to
36:26 help businesses that requires fewer people okay I mean that's one of the realities so so let's take Leisure and Hospitality in fact let's take let's take the fast food industry okay fast food restaurants are having a devil of a Time hiring enough people they just are for the reasons that I mentioned before and so if you can come and so one of the things they're doing is they're raising
37:01 salaries or raising you know hourly pay in order to attract people into you know into working for them even as they do that and here in California there was a law passed recently where the state of California might mandate up to 22 dollars per hour for fast food workers right so here's here's the challenge with that for for larger chains and they may be able to absorb what what amounts to about a at least a 50 percent
37:37 increase in labor costs well and it's actually more than that because that's just the labor cost then there's you know taxes that are paid as a percentage of of wages but for smaller uh restaurant chains or for a you know a fast food restaurant that's just family owned it will it's going to be extremely difficult for them to be able to increase their labor costs to have their labor costs by increased by 50 or more that's probably going to mean they're not going to be able to hire as many people okay or it may mean that they're
38:14 going to have to shut their doors okay um so to the extent that you can come up with things that would help especially these smaller uh fast food restaurants be able to control their labor costs you probably have something a business that will be potentially very successful okay so you can look at these these statistics and use them as a guide to where there may be business opportunity okay so I want to switch to the next slide so you know
38:51 you it's I I wouldn't you know surprise me if you were thinking yourself well you know they're talking about we may be in a recession or we are in a recession and you were saying all this weird economic this just doesn't seem to me to take on uh to be a time to to start a business there's too much uncertainty so I I went and looked this up uh earlier today I mean I knew this was the case but I wanted to give you some specific examples so these 10 companies um probably all of which you've heard of
39:27 survived through the Great Depression they in most cases they were started either right before or even during the the the late 1920s um to early 1930s and yet they survived and even thrived so look down here number nine the Walt Disney Company okay you know uh Mickey Mouse was uh created in his first cartoon came out in 1928 that was right before the Great Depression and and and and the Disney Studios I think as it was called back
40:04 then had only been around for a few years and they were struggling I've read many many stories about Walt and Roy Disney and how they um you know started their company and yet today the Walt Disney Company is the largest entertainment company in the world okay it is um General Motors started not long before the Great Depression and it's I think I want to say it's the third well by by number of cars it may be the
40:40 second oops I don't know what this did um it may be the second largest uh car manufacturer in the world Tesla is of course the largest car manufacturer by market capitalization but in terms of the number of cars Tesla uh builds it's it's not even close to um General Motors or Ford or for that matter stalantis which is you know what Chrysler is now with a lot of other brands so you you look at these these companies here's Anheuser-Busch right they make you know Beer Company Coca-Cola Colgate makes personal hygiene products Levi's jeans right
41:15 um John Deere makes uh you know tractors farm equipment is a farm machinery Etc all of these companies Survived the Great Depression okay and became some of the largest and best known companies in the United States so just because there's uncertainty in the market Marketplace or in the economy doesn't mean that a business can't be successful so I want to show you something I I found I'm going to share a different screen now
41:53 this is it I think yeah okay all right and let's move this over so this is a a some information I found from an outfit called mbroker I guess or embroker I don't know um and I thought this was very very interesting 118 must-know startup statistics for 2022 right for this year so I want to I'm not we're not going to go over all 118 don't worry okay but um and uh I don't wanna I'm not going to talk about uh
42:29 um you know series A and B and C rounds that's you know oh actually there is one thing I want to show you though here the average time between funding rounds from seed which is the startup Capital to series a is 22 months from A to B 24 from series B to series C is 27. in other words for a company to on average for a company to get to the point where it's you know financially solid sound and really a going concern takes six years on average
43:05 okay so the reality is even companies that have raised series a means it's their first time they've raised Venture Capital even for companies that um are at the point where they were able to raise Venture Capital that doesn't mean that they're going to survive okay and and even companies that get by the way to the series B and C levels out you know six years in and by the way that's the average some do it sooner some take longer uh you know you're you're you're not talking uh uh you you're not talking
43:41 about short it seems like these things happen overnight it doesn't it's years years of hard work and by the way look at this the average funding amount for a series C which is a third round Venture Capital raise was 59 million dollars equal 15. that's a lot of money yeah but have you heard about these things called unicorns these are startups that when they go public they go public at a billion dollars or more we hear about these we go oh my gosh it's like unbelievable okay I'm going to show you something about that in a minute but but you know 59 million dollars is a lot less than uh you know than than a billion
44:19 dollars and and that's where they're at in terms of the money they can raise um after six years okay so you know I think we need to sort of keep our our uh you know sites in check as we as we look at these kind of things okay um um uh three million jobs were created in 2020 by startups that that's that's a that's a lot um there as of 2020 there were almost 32 million small businesses operating in the United States okay
44:54 um and I I I feel like I shouldn't I should skip over this because I you know 95 of entrepreneurs have at least a bachelor's degree by the way I don't think that's because you need a bachelor's degree in order to start a business I think that's as much a sign that um people who have gone to college see the potential for starting a business because there are lots and lots of businesses successful businesses started by people who not only don't have a degree but you know never went to college at all so I don't look at this as being anything relevant to to
45:31 starting a business okay so um only two and five startups are profitable um oh yeah only two and five uh stars are profitable other startups are either at break even one and three or continue to lose money one and three okay so only forty percent of startups become profitable okay as of February 2022 there were more than a thousand unicorn startups these are these companies that go public at a billion dollars or more only you know there are more than you know but I think we need uh only a thousand
46:07 compared to probably several million startups it's a tiny tiny fraction okay 69 of U.S entrepreneurs started their business at home okay and the ratio of of male to female entrepreneurs ten to seven okay so not equal um but but you know pretty pretty close okay 66 of small businesses Outsource services to other small businesses okay now that's some that's something I
46:43 was talking about a minute ago when I said if you have a business idea that will help a small fast food restaurant company not need as many employees you probably have a winner and here it is in the sense that you're a you're a business to business company right and two-thirds of small businesses are actually serving other small businesses okay it takes only four days to start a business in the United States and in fact um I've done I've done this uh uh for a a couple of groups um in in the last couple of weeks Most
47:19 states you can go online and go on to their the website for this for this the state government you just fill out online the information in order to start your entity whether it's an LLC a corporation and and you can pay with a credit card and Bang You're Off to the Races your business has started so it's it's it's never been easier to form an entity to start a business okay now you still may need to get your business license there's other things that may have to be done um having said that it's it's never been easier okay now let's look at some other
47:55 things here um founders of a previously successful business have a 30 chance of success in their next venture um so once once you've done it successfully one time you're more likely to be successful the next time and and and I see that too when I talk to business startup people um there they you you see there's there's people who they start a business they get it successful they sell it or other people come in to run it and they move it on to the next one they they like the the sort of you know challenge of the startup phase that they don't want to you know carry a business on
48:30 through into maturity and all that okay Founders who have previously failed have a 20 chance of success while first time Founders have an 18 chance of success so roughly the same in other words you have a one in five chance of success okay now here's the key 82 of successful business owners say they have the right qualifications backed up by experience even with limited cash flow okay so therein you see the key
49:08 four out over four out of five business owners were successful because they had the right qualifications backed up with experience that's really what makes the difference here okay so when if you're thinking about starting a business my question to you is what qualifications do you have as they relate to that specific business and what experience do you have in that specific business okay now if you don't have the right qualifications or experience for a particular business or
49:44 you don't have all of them that's not at all unusual the key is to find someone to work with who will fill in your gaps okay nobody's got it all I mean not even a lawn Musk he has the things that he's good at he's hired people to fill in those gaps and you can do the same thing okay let's look at some other ones here real quickly before we run out of time okay the main challenge to success of a startup is struggling to find a market need
50:19 and look at this one right here paying attention to your customers is important since 14 of startups fail due to not regarding customers needs so here you have it in a nutshell if you want to have a successful business you need to find a real Market need and then focus on serving your customers okay that's what it takes when I started my real estate company in 1986 pretty quickly I came to the conclusion
50:54 it's funny because I was just saying this to someone else uh this morning that I was talking to the hardest thing to do is to find a good client so you got to hang on to them you have to serve their needs now by the way is the client always right no I'm sorry the client is not always right okay and when you find yourself finding a particular client wrong too often it's time to get rid of that client having said that when you establish a relationship with a client
51:29 it behooves you to make sure that you are meeting their needs and there's an easy way to figure that out get in touch with him periodically and say you know what's going on what are you working on how can I help you accomplish your goals okay now by the way that's true whether you're in a service business or in a product business because if your product is not going to help your customers solve a problem or meet their goals you're not going to sell your product so the same philosophy Works no matter what kind of business it is okay now we
52:05 just have a few more minutes here so I want to cover just a couple more things okay ninety percent of startups fail that is just the statistic okay um that doesn't mean that you're gonna fail though okay only twenty percent by the way fail within the first year so four out of five startups are still going after the first year okay failure is most common for startups during years two through five okay well there you go because twenty percent follow-up out in the first year the other eighty percent fail in years two through five that would make sense okay um and it doesn't seem to matter what
52:42 industry you're in the the failure rate seem to be the same okay so number one reason startups fail is due to running out of money or failing to raise Capital that's almost forty two two out of five cases now now by the way the question comes down to why did they run out of capital it's not because they ran out of money right it's because they didn't find a market need that needed to be met okay and and or they didn't have the right qualifications backed up with experience
53:17 to run the company so you notice here even with limited cash flow This Is What It Takes right so having the right qualifications and experience can overcome running out of money do you see how this information works together by the way I'm gonna I'll post a link to this report so on the show notes for the website or for the for the show I mean so if you want to download this and read all of it because like I said there's there's 23 Pages this report we're only I'm only looking at a few of them just to give you an idea of of what it's up
53:52 what you're up against okay um 35 of cases are due to lack of a market need right so here you've got 47 almost three quarters of cases it's because either there wasn't a market need or they ran out of money and by the way I suspect the reason they run out ran out of money like I said before is because either the the the the start the the founders actually didn't have the qualifications and experience to run the business or they just they had misidentified a
54:27 market need and so they're trying to sell something uh service or product that there's no or too small to market for and they and they ran out of money because people are looking and saying no this isn't going to work so I'm not going to give you more money okay I want to look at one more thing here real quickly uh let's see okay one in three began their small business with less than five thousand dollars okay one in three was less than five thousand dollars okay and forty four
55:03 percent of financing for new businesses came from business loans credit cards lines of credit and by the way I bet you credit cards is the biggest part of that personal credit cards most it seems like most startups I talked to today when I when I when we talk about the early days they borrowed money off their credit cards and that's how they got started okay so this points out to something between what I showed you before about companies that survived and became huge even though they got went through the Great Depression and
55:38 the various statistics that we have here if you have the qualifications and the experience to start a business and if you find a market need okay A True Market need not I think the market needs it but a true market need okay and you combine that with some courage right not a whole lot of funding necessarily to get started okay then although only one out of ten uh startups ends up being successful still
56:14 you can be that one out of ten and by the way you will uh double your chances of succeeding the second time even if you fail the first time okay you don't and the reality is I probably failed the first time or two I started a business I you know it depends I don't exactly know how they you know defined it for this report but uh you know there were things that I tried that I didn't work and I had to Pivot and I had to morph into new new lines of business or different things and and and
56:49 you know that was fine and even in the like I I first thing I tried to do was sell t-shirts and I I realized pretty quickly wow this is a tough business you know and I I didn't go very far with that at all when I realized what it really took the best way to get experience as an entrepreneur is to start a business that's that's in this report too by the way but that's that's always been my considered opinion uh before I read this report so the best way to learn to be an entrepreneur is to start a business and there's no better time than right now
57:25 okay because if you've got a viable idea and you've got the qualifications and experience you stand a very very good chance of being successful so the key is is is to be thoughtful about it okay but don't be so thoughtful about it that you you plan and plan and plan and never jump in at some point you got to pull the trigger knowing that you know frankly the odds are against you um there's there's a good chance you'll fail and if you do you'll have learned a lot and you'll be ready for your second Rodeo as we say
58:02 so that that's all I have for you today I I hope you found this interesting I hope you found it informative if you have questions feel free to uh drop them into uh if you're if you're watching this on social media you know comment on the the social media post um or go to our YouTube channel got my uh um email addresses there you can email me a question happy to answer your questions if you have an idea for someone you want to see on the show let me know I'll be happy to contact them maybe it's you maybe you have a
58:37 remarkable way of making a living please let me know be happy to have you on the show and so again I thank you for joining me this afternoon wish you a wonderful wonderful rest of the day and it just then is for me to sign off as I always do by remembering my my dear friend and letting her know that Marie darling you are still my bell thank you all very much we'll see you next week