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ASIAMS.NET |
ASIAN AMERICAN ISSUES
Starting Your Own Business
(Updated
Tuesday, Apr 1, 2008, 05:56:10 PM)
hat's not to like? Tell off the boss, scrap the suits and ties, exit commuter hell, set your own hours and rake in the riches. Hell, if average joes like Charles Wang, Jerry Yang and Pehong Chen can bootstrap startups into billion-dollar companies, what's to stop a savvy, hardworking wiz kid like you?
Top AA entrepreneur
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That's precisely the thinking of the 913,000 Asian Americans who run their own businesses. As of 1997 (the most recent year for which census compilations are available) Asians made up 4.5% of all U.S. busiinesses. On a per capita basis AA are nearly twice as likely as other minorities to start a business. And they're doing well. Between 1992 and 1997 the revenues of Asian-owned firms jumped 68% to $307 billion, compared with a 40% growth for all U.S. businesses.
But commerce department stats show that most AA startups aren't of the fantasy variety. Only 32% had paid employees and only 2,100 (2.3%) had 100 or more employees. Maybe the most discouraging to prospective entrepreneurs: only 5% (45,300) of firms had gross receipts of $1 million or more. Far larger numbers (259,600 or 28%) had annual receipts of under $10,000.
AA businesses also don't fit the stereotypes of hi-tech garage startups or mom-and-pop grocery stores. The biggest share (44% versus 43% for all U.S. businesses) fall into the services category, with heaviest concentrations in business and personal services. The number two category is retail (21.4% versus 14% for all U.S. businesses), followed by "Not Classified" (10%), finance, insurance and real estate (8%), wholesale trade (6%), transportation, communications and utilities (4%), manufacturing (3%), construction (3%) and agricultural services (1%).
In terms of gross receipts, however, wholesale trade accounted for over a third of all receipts with $105.5 billion, followed by retail ($67.9 billion) and services ($67.8 billion) where a much larger share of the receipts survive to the bottom line. Asians own 5,634 law firms, 74,471 medical firms and 23,242 manufacturing firms. Of those, 1,676 companies with 33,616 employees were listed as manufacturing electronic and electric equipment. The glamour fields make up relatively small numbers. For example, listed under "motion pictures" are 4,338 AA firms with $49.5 million in sales. Of those only 1,622 had paid employees, 8,326 of them.
By nationality, Chinese Americans owned the most businesses (252,577), followed by Indo-Ams (166,737), Cor-Ams (135,571), Viet-Ams (97,764), Japanese-Ams (85,538), Fil-Ams (84,534) and other Asians (70,868). Revenues showed greater disparity: Chi-Ams ($106.2 bil), Indo-Ams ($67.5 bil), Cor-Ams ($45.9 bil), J-Ams ($43.7 bil.), Other Asians ($19.0 bil), Fil-Ams ($11.0 bil) and Viet-Ams ($9.3 bil).
All these stats are meaningless, of course, if not downright hazardous to those who risk life savings, good credit and a steady paycheck to launch themselves into trajectories that are always unique, perilous and non-reversible. In the end all that separates the eight tattered failures from the one gleaming success is a relentless will to pay whatever cost is demanded.
Is starting your own business really the best way to fulfull the American dream? What separates the sun-bleached carcasses lining the road to riches from those who arrive in air-conditioned style?
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WHAT YOU SAY
[This page is closed to new input. --Ed.]
RycherX,
I would agree that few can expect to get rich just by climbing the corporate ladder, but it can happen. Like Gerald Levin who managed to cash in about $150 million on stock options in his last year before being pushed out by Case and Turner. There are probably several hundred corporate execs who get legitimately rich each year, mainly from exercising stock options. By rich I mean banking more than $2 million a year for at least three or four years.
You have to remember that most entrepreneurs don't get rich either. I would have been happy to average $500,000 a year but have never done that in 12 years and 3 businesses. The best I've managed is around $200,000 for a couple of years back in the late 90s. If I took a 10-year running average it would be a lot lower, maybe about 60% of that.
Bottom line, it isn't so much the money as lifestyle. There's less need to brownnose when you're your own boss, though clients do expect a bit of kowtowing. Also, you don't have to be as much of a conformist when you aren't trying to fit into the corporate culture.
AC,
I've been working so hard just to keep my head above water that I don't know if I've ever thought about being committed to any vision except turning a profit and trying for a bit of growth. I changed businesses twice in the first three years because I didn't see things improving. I'm doing better in my third business, but if it started heading south, I wouldn't hesitate to move on to greener pastures. You must have enjoyed some early success to have the luxury of talking about vision and commitment.
Serial Masochist
Saturday, July 27, 2002 at 17:41:38 (PDT)
I agree that passion with the work is important for the self-employed. You have to spend so much time and energy that you can't count hours like you used to at regular job.
In spite of the risks, entrepreneurship is a worthwhile undertaking. I'm not cut out to be an employee, to engage in petty office politics, etc. Regular employment is ultimately for the mediocre minds. It is glorified slavery at best. The most talented and ambitious AA's would do better working for themselves.
Commentary
Thursday, July 25, 2002 at 21:22:58 (PDT)
My opinion is that you won't get rich in corporate america. If you can get a good 6 figure salary, it would be busting your butt at least 60 hrs a week in the office. I don't want to be 45 years old in a cubicle and regret not taking the risks at 23 for the big $.
Rich to me is over $250 k a year before age 30. You can make that much in sales, it's worth taking risks before you're 30.
RycherX
tate007@yahoo.com
Thursday, July 25, 2002 at 13:12:24 (PDT)
Yeah but look at Charles Wang in the picture. He looks so damn happy!
When you get to his level you can always use Stock options and other incentives to pump up the companies stock and boost up your income through I think it is called: "Creative Accounting" where you can cook the books and still end up ahead.
You can also live in Texas or Florida where you can put in millions into your private residence and still be sheltered from any problems your company may be doing.
Being CEO is best!
Thursday, July 25, 2002 at 12:47:05 (PDT)
My only advise looking at my experiences over the past 6 years in running a business... is to be committed to your vision.
There will always be details in running a business that are necessary and distracting. But one must always be committed to the vision. That is why it is always best to start a business in something you enjoy so that you will not stray away from the vision when obstacles appear.
Also don't worry about re-adjusting your vision every now and then. In the 1st year of business, I failed terribly at my first venture. Took 3 month to start-up again and it has been the core business ever since. Along the way I have started other ventures, branching off into other markets. Some fail, some succeed. But don't let set backs keep you down for too long.
There are headaches in a business. My personal dreaded part of a business are the personell management issues. How much a raise a person should get, Who should be promoted, Which department needs to have layoffs....
Rationally, if your in a good job, there are probably more reasons why one shouldn't start a business. But if your willing to take the risk and enjoy the lifestyle you'll be leading, it might be worth it.
AC Dropout
Thursday, July 25, 2002 at 09:01:04 (PDT)
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