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FiveThirtyEight: The Slow Death of American Entrepreneurship

http://fivethirtyeight.com/features/the-slow-death-of-american-entrepreneurship/

This seems to be more an exercise in extrapolating from woefully broad statistics than anything meaningful. As they’re looking at Census data, the idea that new businesses are declining covers both your stereotypical tech startup and new restaurants, small retail, and others, which we’ve known are declining due to a number of forces.

There’s also a countervailing force not at all discussed. I went to a school with a lot of support systems for student inventors and student entrepreneurs, and I saw a lot of my classmates develop business plans and start companies around the time I graduated…you know, 2009, the peak of the recession. In high-talent labor pools (the ones from which most disruptive startups arise), startup development is likely at least somewhat countercyclical with the economy. All entrepreneurs are risk-seeking people, but when the risk of trying to find a “normal” job is higher, more people will make the decision to strike out on their own. Remember, MBAs don’t start businesses typically, engineers do. So my amateur opinion is that a decline in startups is likely a correction as the economy recovers rather than a long-term trend, You heard it here first, folks.

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