Is Entrepreneurship Getting Harder? 2

Adeo Ressi says entrepreneurship is getting a lot harder.

“Compared to when I started my first company, in 1994, things for the entrepreneur founders have gotten exponentially worse. There’s steadily more regulation, less liquidity, more difficult labor situation; things are always getting harder.

“When I was a newbie in 1994 it was complicated, stressful and difficult. But it was significantly easier than it is today. The only reason that I could easily start a seventh and eighth company recently was that I have 15 years of experience starting and running companies under my belt. If I were like at ground zero, in today’s market, I couldn’t do what I’ve done.”

Ressi should know. As you probably already gathered from the quote here, he’s been around this block a few times. I posted about his newest venture, The Founder Institute, on my Planning Startups Stories blog last month. And he is the founder of theFunded.com, a site where entrepreneurs can review investors.

“Honestly, I think more and more, these days, the entrepreneurs get a raw deal. They are victims of a lot of predatory and exploitation behavior. A lot of this is on the part of investors, taking advantage of their position with founders looking for capital. But it’s not just them. It’s the whole gamut of service providers, regulations and so on.”

In what feels like ironic understatement, he says TheFunded.com “has tried to address some of the problems of the predatory and exploitative things that happen when founders are seeking capital.”

He goes on quickly, though, to point out that schools aren’t teaching entrepreneurship well. Legal regulations keep pouring on new obligations and the life of a would-be funder gets tougher. Reflecting on The Founder Institute, which offers a three-month educational program backed by some big names in startups, he says:

“If we could eliminate all the headaches that modern bureaucratic layering adds to start a company, and allow these founders to focus on the core business challenge, the likelihood of success increases dramatically.”

And this is not about the depression. At least, not specifically. Asked whether that was the reason for starting his new institute, he told me:

“Why now? Well, now is the only time to do it. When things are good, help isn’t all that helpful. When things are bad, the ability to do something like this can have a bigger impact. Hopefully we can help people get companies off the ground that wouldn’t make it otherwise. And everybody knows that what really drives this economy is small business and entrepreneurship.”

So there’s a point of view for you. I hope he’s wrong, that things aren’t harder–at least not in the long term–but then, what do you think?

  • http://www.thegrowthgroup.com Elliott Dahan

    “He says TheFunded.com ‘has tried to address some of the problems of the predatory and exploitative things that happen when founders are seeking capital.’”

    Every startup I’ve dealt with in the past 20+ years has always needed 2 things: Validation (partners, customers, usage)and Money.

    Only when a startup shows some level of Validation will that startup get additional funding beyond the Friends&Family / Credit Card initial funding put in by the Founders. (unless the Founders are part of the current wave of “superstar / rockstar” folks who get offers of money in direct proportion to the latest amount of lines of press coverage they’ve received).

    Entrepreneur Boot Camps and Summer Camps and Demo Shows are wonderful for instilling an awareness in the Entrepreneur that one day he/she will have to build something that someone will either want to buy as an end product or as a part of whatever it is thy need for their product.

    But, at the end of the day, an Entrepreneur has to bring a product or service with “Traction” to the Series A level of funding.

    There must be a level playing field between the Entrepreneur and the Series A Funder if the Entrepreneur ever expects to be able to push back on the “predatory and exploitative things that happen when founders are seeking capital.”

    Elliott Dahan

  • http://hartofsuccess.com/ Stefanie Hartman

    Great post. I do think entrepreneurship is getting for all the reasons Adeo stated. However, the rewards and benefits still far out way any of the negatives and should not discourage would be entrepreneurs.

About the Author Tim Berry is the founder and chairman of Palo Alto Software and Bplans.com. Follow him on Twitter @Timberry. Follow Tim on Google+ Read more »

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