4 Few Reasons Entrepreneurs Have Succeeded in America
Entrepreneurship plays a vital role in the growth of the U.S. economy. The idea of entrepreneurship in America is tied tightly to the idea of capitalism and characteristically involves an entrepreneur identifying an opportunity and assembling the ingredients to pursue it. Usually by investing his or her own capital—whether it is her time, money, or know-how.
Entrepreneurs must devise a way to marshal limited resources. At the heart of the process is the creation and recognition of opportunities, followed by a willingness to seize those opportunities. This means taking both personal and financial risks in a calculated fashion, but with no guarantee of success.
From the first patent awarded to an American resident (Joseph Jenks in 1646) to Airbnb (if you don’t know what it is, download the app), entrepreneurship has been a crucial part of America’s imagination and economy.
1. Freedom to Take Risks . . .
American children are taught stories about inventors such as Benjamin Franklin and Thomas Edison in textbooks and can now look up Mark Zuckerberg and Evan Spiegel on their iPhones. We teach our children their fate still lies in their own hands, forcing them to be comfortable with the risk-taking that is at the heart of entrepreneurialism.
2. and the Freedom to Fail
A second great spur to entrepreneurship is the freedom to fail, and no country in the world has been as consistently tolerant of economic failure as the United States. The majority of new businesses (around 67%) in the United States will fail within their first four years. In some countries failure (bankruptcy) is regarded as a moral failure and spells social death. In America—particularly in Silicon Valley—it is viewed as a badge of honor.
3. Immigration and Education
The role of immigrants and the tradition of close relations between universities and industry also played a significant role in self-employment and entrepreneurship. In 2012, immigrant-owned companies employed 10% of all individuals working for privately-owned U.S. companies and paid their employees $125 billion in salaries.[1] Additionally foreigners educated in America's universities have helped to spread the gospel of entrepreneurialism worldwide.
4. Adventurous Consumers
Apple sold half a million iPhones in its first weekend. America has enough venturesome consumers who are willing to try expensive new products even if it means teaching themselves new skills.
The combination of these factors has made America a powerhouse in both the entrepreneurship and venture capital arenas and as a next digital wave continues to crash on American shores it will be up to a new generation of entrepreneurs to capitalize on it.
This article was written by Curtis Roberts, the founder of The Founder's Attorney.
If you have any questions or suggestions he can be reached at curtis@foundersattorner.com. You can check out his LinkedIn page here.
[1] Robert W. Fairlie, P'ship for a New Am. Econ., Open for Business: How Immigrants are Driving Small Business Creation in the United States 6 (2012).
This article is for general information only. The information presented should not be construed to be formal legal advice nor the formation of a lawyer/client relationship.