Why Own a Business?

A Journey through the Solar System. Yes, it’s a class. My cousin was a business student at UT Knoxville. She took that class amongst many others. Her cost to go to UT? $239,350 (Including room and board, fees, books and other school-related expenses.) That was 11 years ago. She’s still paying on her student loans. She enjoyed the class and others that she took at the time, but now she’s really paying for it and none of these “elective” classes have helped her in her career.

• Time Magazine, in 2013, said that the average 4 year degree is taking 5 to 6 years to get.

• Money Magazine recently published that, for the 2016-2017 school year, the average in-state school with tuition, fees, room, board, books and incidentals will cost $20,663.60 per year.

• According to Marketwatch, the average student graduates with over $35,000 in student loans and more than 70% of students have them.

When I went to college, I also took some crazy and fun classes. I loved astronomy classes and some of my favorites were Classical Political Philosophy and Modern Political Philosophy. I started my first business when I was 14 years old. I was in 8th grade. I did graphic design work. I started my second business at age 17. Business consulting. By the time I went to college, I wasn’t looking so much for a degree. I was looking for knowledge. I was growth-focused. And yes…those crazy and fun classes did help me in my business.

I took astronomy classes to get more design ideas and inspiration for the company. It was outside-the-box thinking. The philosophy courses helped a lot for coaching and consulting. I am not against college. I am very much for it as a means to an end.

However, our education system is broken. As a society, we waste a significant amount of time and money sending children to college to figure out what they want to do. Those are some expensive lessons. College, for some, is a great idea and a great way to get where they want to be. For others, it is an astounding waste of time and money. By far, the majority of what you learn in college will not be useful at all in your career.

The ability to own and run a business, on the other hand, is something that can be used in any career or profession. Whether you decide, ultimately, to stay a business owner and make that your lifelong career path or you decide to go to work for someone else, the skills and knowledge you learn from starting a business can be invaluable in all areas of life.

The leadership and management skills don’t simply translate to a career, they are also used in the home. The ability to “fend for yourself” should you get laid off, downsized or fired from your corporate job can keep your family from going under.

Here are a few other reasons why it’s better to start your own business than receive a piece of paper that may or may not mean anything for your future:

1. NETWORKING

People often say, “It’s all about who you know.” While there may be a very small amount of validity to that, in reality, it’s about who knows you.

Have you ever walked up to someone to say “hi” and realize they don’t remember you. Who has the power in that conversation? They do.

Starting a business forces you to expand your network base and get known. As one of my students pointed out the other day, 100% of the people who don’t know you exist won’t buy from you. Expanding your network expands your opportunities both in business and personally.

2. COMPOUND INTEREST

Compound interest means that you not only make (or pay) money on your principal, but also on your interest. The same works in business. The more you focus on growth, the more it will compound in your life.

This includes your money, but isn’t just about money. It also includes your experience, your business, your insight and your opportunities. It’s one of the reasons that people say “the rich get richer and the poor get poorer.” Though that’s not 100% accurate, it does offer some insight into the compound interest effect we’re talking about.

The more the “rich” grow, the more they are compounding on their knowledge, money and skills and are seeing and creating greater and greater opportunities. In business, if you’re not moving forward, you’re moving backward. There’s no such thing as sitting still.

3. PRACTICAL APPLICATION

One of my companies is an accounting firm. We get interns frequently from local universities. I love our interns, but they are a lot of work. Many of the interns we get are working on their Master’s Degree in Accounting. While this is great to have, most of them come to us with no ability to put the theories they have learned into real world experience. 95% of businesses in the United States are defined as small businesses. QuickBooks, the industry standard in accounting software has an 80% market share. None of the interns we have had have ever seen the software. We have to train them from scratch.

I’ve met many people over the years that I’ve thought to myself, “he has a lot of book smarts, but no common sense.” While theory is great in many aspects, practical application and experience is necessary to be successful at anything. Starting a business forces you to learn how to put theories into practical use.

4. SECURITY AND CONTROL

I have long said that the only security you have in life is the security you create for yourself. Long gone are the days you can rely on employers to provide all the security you need to live well. Today, companies are going through mergers and acquisitions, layoffs, downsizing, closing their doors or moving to other countries. The idea of “getting a steady paycheck” as being security is a farce. At any given point, you can go into work and no longer have a job. Add that to the fact that the average American household has less than $5,000 in savings, that can create a tremendous burden should it happen to you.

Starting and building a business allows you to create your own security and control your future. Life By Design. As a business owner, that’s what life is about. Set your own hours and make how much money you want to make. A life that you don’t control, controls you.