Written by Guest Blogger: Steve Rice, EVP, EverFi
Small business owners are among the hardest working people you will ever meet. From the moment they wake up in the morning, to the time when their head hits the pillow at night, they are often obsessing about their business. It is not uncommon for an entrepreneur to put in 70-80 hour work-weeks—with downtime being primarily purposed for sleeping.
So why would someone choose to put themselves into this kind of lifestyle? One word: passion.
Every great company starts with a single idea. Someone somewhere gets an idea that they can’t stop thinking about. A passion for cooking. A passion for flowers. A passion for efficiency through technology. This passion soon becomes an obsession, and can drive a person to quit their current job and take the entrepreneurial plunge.
But just because someone is an accomplished painter, tech coder, or marketer, does not correlate in the slightest to their skills for running a business. In fact, without proper training, it seems highly unlikely that someone who can make delicious croissants would just happen to have the right skills to manage cash flow.
Most small business ventures fail. According to Bloomberg, 8 of our 10 small businesses fail within the first 18 months. Of course, there are many reasons why a small business fails, but at the core of it, many times comes down to a gap in the fundamental understanding of how a small business needs to be managed.
Managing a small business is a tricky endeavor. Depending on the type of business, there are profound needs in understanding many different topics: commercial finances, access to capital, staffing, taxes, marketing, financial statements, and dozens of other factors. Again—there is no reason to assume that an entrepreneur would be able to instinctually intuit these topics—those topics need to be learned. Small business owners are in a catch-22: they need to learn the skills, but do not have a time to learn them.
Luckily, there are some resources available to help entrepreneurs out there—but these resources need to be simplified for the busy small business owner in order to be helpful. They need to be available any time of the day—even at 1:00 am, after the last customer leaves the restaurant. They need to be self-paced to accommodate the surprises that pop up in an entrepreneur’s work day. And the content needs to be tailored to the needs of a small business owner—not general financial education or a few YouTube videos.
Financial institutions across the board should be providing this entrepreneurial content. Credit unions can benefit not only from the individual growth of the entrepreneur, but can also benefit from the overall growth of the entire business—growing businesses hire more employees, and those customers, with income, have more opportunity to partake in the banking system.
As an industry, let’s embrace the entrepreneur’s passion. And let’s supply those small business owners with the right type of education to keep their businesses around for years.
Are you passionate about helping small business owners? We are too. Learn more about EverFi’s Small Business Bootcamp here: https://everfi.com/smb