Launching a business – what are the contributing factors?

The study suggests a community that has the infrastructure to support a major retail chain may also have the same infrastructure to support many businesses, said Glenn Muske, Oklahoma State University Cooperative Extension Service home-based and micro business specialist, and interim assistant director.

“Our economic growth depends on having a continuous supply of new business owners who are trying to capture the American dream,” Muske said. “A growing economy will increase its number of businesses by approximately 3 percent each year.”

While the path a business follows relies on many important variables, there are basic items that all successful businesses owners must have—passion for the business, realization about the market and innovation.

According to the study, one with a high education level such as a graduate degree, is 94 percent more likely to start a business and someone with an attempted business plan was found to increase his or her chances of starting a business by 24 percent.

A high education level is often referred to as human capital, this is an important factor in entrepreneurship, Muske said. He further stated the business plan indicates writing workshops and seminars may have been worth the entrepreneurs’ time.

Other key factors in entrepreneurship, according to the study, are having a net worth of $50,000 to $75,000. This was found to increase chances by 74 percent, whereas having a net worth of $100,000 increases chances by 42 percent.

These results show that money does benefit an entrepreneur when they are starting their business, Muske said.

Owning a house was actually found to decrease the chances of starting a business by 6 percent, according to the study.

“This may be connected to reluctance to take risk, but this is hard to determine,” Muske said.

The results from the study propose education, planning and financial resources are vital to business start up and it is possible that without these elements a business may never get off the ground.

In addition, the owner must have a passion for the business he or she selects. Muske said most owners should select a business that they can see themselves working in 24 hours a day, 365 days a year.

“Developing a successful business is hard, but trying to develop one without ‘loving’ what you are doing makes it harder to work when it seems like everything is falling apart,” he said.

Muske said the OCES is able to help entrepreneurs and small business owners by providing educational materials and workshops. For more information contact your local county Extension educator.

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Katie L. Reim
Communication Specialist
SU Agricultural Communication Services
140 Printing Services Building
Stillwater, Ok 74078
(405) 744-6792
katie.reim@okstate.edu 

Oklahoma State University, U.S. Department of Agriculture, State and Local Governments Cooperating: The Oklahoma Cooperative Extension Service offers its programs to all eligible persons regardless of race, color, national origin, religion, gender, age, disability, or status as a veteran, and is an equal opportunity employer.