Inc. 500 (2014) CEOs Describe First Year in Business

It is well known that the vast majority of start-up businesses fail in the first year and a half (rumored to be around 80%). Inc. magazine's new survey of their Inc. 500 CEO member list (September 2014 edition) shows that often even highly successful start-ups initially suffered from the same types of problems that failures did - undercapitalization, poor leadership, bad market timing, failed product or service rollout, difficulty finding and retaining skilled employees, poor fiscal discipline, and the list goes on. 45% claim not enough money at the outset was the biggest issue. A bad fit with key employee(s) and business partner(s) was a close second at 32%. There was no "I was just stupid at first" category, but if there was and people were honest, the percentage would probably be pretty high.

If you are, have been, or plan to be a business owner, whether by starting your own company from the ground or buying an established one, you would likely benefit from a monthly reading of Inc. Even thought I have virtually nothing directly in common with 99% of the people and businesses featured (especially their youthfulness), I find many of the stories and presentations of statistical data quite interesting. The most important lesson learned after years of reading Inc. is that there seems to be a highly profitable market for just about anything that interests you as well as anything that you couldn't care less about. I am especially amazed at all the people pulling in hundreds of thousands or even millions of dollars annually selling (to me) unlikely successful products and services due to either inanity (indoor trampoline parks - 8,200% growth) or already saturated markets (health and nutrition - 57,000% growth). Selling educational stuff to kids' parents (and school systems) can get you 160,000% three-year growth.

When queried about personalities, the "500" list members described themselves as risk takers, delegators, knowledge seekers, creative thinkers, promoters, and relationship builders. 75% of them started their businesses with personal savings, with 43% supplementing that with loans and 22% (a larger number IMHO, and compared to only 4% in the 2012 survey) securing venture capital. 28% say they get their best ideas from customers, while 26% come up with the best stuff on their own. 87% use LinkedIn for networking, beating out Facebook by 2 percentage points; 75% used Twitter. Companies catering to the energy market sector far outstripped any other in revenue, being almost double the runner-up of consumer products and services and 3x the number three sector of health. 50% of the top CEO list makers have a college degree or have taken courses. 12% have only a high school diploma without at least some other education, but 64% recommend a college education prior to starting.

This goes to show why even a business like RF Cafe can survive for over a decade. With the stock markets daily setting new highs and banks tripping over themselves looking to lend you money that they get for nearly free from the government e-printing presses, there is no better time to make the big leap of faith in yourself and start a business - any business, evidently. Don't want to get a loan or risk your own hard-earned money? Crowdfunding seems to know no limits these days as 4- and 5-figure pledges are commonplace, and it seems to be easier to fail at your mission without having to refund investors (it's the 21st century way). I have promoted many high tech start-ups on RF Cafe over the years, mainly by posting press releases and/or writing a short story about the companies. Send me your story and I'll be glad to consider it.

Beginning January 1, 2015, RF Cafe will be switching to a new business model whereby there will be no more (or at least very rare) private advertising being hosted. The primary motivation is to free myself and the website format from clutter both visually and from time consumption standpoints. Instead, I will let 3rd-party services handle all the advertising (Google AdWords, GlobalSpec, Bing/Yahoo!, etc.). Doing so will hopefully free my time to pursue other tasks like maybe writing some new software, publishing more personally written articles, and strategizing on how to make RF Cafe more useful to visitors - especially in the mobile device environment. Having to keep track of 80-90 advertisers each month can be very time consuming. It will be more important than ever that you, the visitor and beneficiary of RF Cafe's effort, support my advertisers by visiting their websites and considering their products and services. Companies are able to target specific websites with their ads based on return on investment (ROI) metrics from their banner ads. The more business they see coming from RF Cafe, the more likely they are to invest. Thanks for reading - now go start your own business!

Posted  September 12, 2014