The Major Pitfalls Faced by Young Entrepreneurs
Launching an ambitious new venture is challenging even at the very best of times.
But for young entrepreneurs, especially those in Gen Z (born after the year 2000), running a business can have even more complications that make it difficult to get basic tasks done.
Whether it’s credit card age limitations or simply not being taken seriously by employees or vendors, young entrepreneurs must find ways to overcome these business challenges.
Identifying the Pitfalls
Today’s infographic comes to us from Insurance Quotes, and it identifies the pitfalls encountered by young entrepreneurs as well as some of youth’s most important advantages.
Millennials, in comparison to the generation before them, have been less entrepreneurial as a whole. In fact, only 24% of 20-34 year olds today are new entrepreneurs, compared to a 34% rate from two decades ago.
Gen Z, however, is looking to take the reins – and now, 72% of high schoolers say they want to start a business someday.
Pitfalls for Young Entrepreneurs
Despite this increased interest in entrepreneurship, Gen Z faces significant pitfalls that must be overcome:
Many small businesses use credit cards or bank loans for day-to-day purposes, whether they are for picking up small expenses, growth capital, or as cash flow buffers.
However, in the United States, you must be 21 years old to get a credit card without a cosigner or proof of regular income. For bank loans, that age requirement drops to 18, but even then a cosigner or good credit is usually required.
In the same vein, age restrictions can also make it hard for young people to network, since many conferences or events take place in licensed establishments like bars or casinos.
Vendors, colleagues, and employees may not take young entrepreneurs seriously. Sometimes stereotypes of young people being a certain way may persist, as well.
Young entrepreneurs must divide time between business and school, creating competing priorities.
Inexperience can also be an early enemy for young entrepreneurs – hiring friends (instead of qualified people), micromanaging, being overprotective of new ideas, or mixing business and personal finances can be just some mistakes made from a lack of experience.
Advantages of Youth
Despite the list of potential pitfalls, it’s also clear that youth can provide big benefits to an up-and-coming business owner.
Firstly, the barriers to entry of business today are lower than ever before. It’s now possible to sell almost anything online for next to nothing, and Gen Z is inherently knowledgeable when it comes to exploiting any new technologies.
Next, without families to provide for or mortgages to pay, young people also typically have fewer responsibilities. This sets them up to take on risks that might steer away more seasoned businesspeople.
Lastly, a lack of experience can also be a massive advantage if used correctly. Young people have no preconceptions of “how things should be”, and can use that to pull off new ideas that others simply couldn’t imagine. This naiveté is arguably a big part of how today’s modern giants like Airbnb and Facebook came to be.
The Type of Business Every Country Wants to Start
This series of maps shows a regional breakdown of the most popular types of businesses people want to start, based on online search results.
The Type of Business Every Country Wants to Start
View a higher resolution version of this map.
Every year, millions of new businesses are started across the world—in 2021, nearly 5.4 million new business applications were filed in the U.S. alone.
And since startups and new businesses play a significant role in shaping a country’s economic growth, encouraging entrepreneurship is vital. But what types of businesses around the world are people most interested in starting?
These maps by ZenBusiness show the most popular types of businesses that entrepreneurs in nearly every country want to start, based on analyzing relevant internet search results.
Most Searched Businesses Around the World
To source the data, ZenBusiness analyzed searches from Ahrefs, specifically looking for the term “start a business” and its equivalents in local languages as of February 2022.
They then found the relevant topic or keyword with the highest search volume, and organized the results into 11 different industries:
- Beauty & Cosmetics
- Food & Drink
- Logistics & Infrastructure
- Personal Services
- Software Development
- Business & Financial
- Leisure & Tourism
- Real Estate
- Retail & E-Commerce
The data showed that the industries entrepreneurs are most attracted to vary greatly from country to country, depending on a variety of factors such as infrastructure, business climate, and culture.
Here’s a breakdown of the most searched businesses around the world, broken down by region.
From cooking gas refills in South Africa to supplements in the Gambia, entrepreneurs across Africa seem to be interested in starting a wide range of businesses (at least according to their searches).
But while the results varied across the region, the most-searched industry was personal services such as cleaning, interior design, and contracting. Cleaning was especially popular, ranking first in six different African countries.
One African country worth highlighting is Morocco, where freight is the most-searched startup term across the country. This makes sense considering Morocco is home to several major ports, including the Port of Tanger Med, which is Africa’s largest port by cargo capacity.
In Europe, real estate is the most-searched industry, ranking number one in seven different countries across the continent. Over the last decade, the European Union’s real estate market has boomed—between 2010 and 2021, home prices in the EU increased by 42%.
Retail is also a popular industry across Europe, with clothing-related searching taking the top spot in five different European countries.
Middle East & Central Asia
From soap production in Uzbekistan to dropshipping in Azerbaijan, the Middle East & Central Asia have the most diverse searches compared to any other region.
One particularly interesting top search was in the United Arab Emirates, where imports and exports ranked first. The UAE’s economy is heavily reliant on trade, especially oil, which makes up 30% of the region’s GDP and 41% of public revenues.
Rest of Asia & Oceania
Asia and Oceania had an interesting mix of unique business searches. For instance, pig farming ranked number one in the Solomon Islands, and lawn moving took the top spot in New Zealand.
But generally speaking, retail was one of the most-searched-for business types across this region, with clothing taking the top spot in countries like Australia, Indonesia, and Singapore.
Across North America, retail takes the top spot for most searched business type. In fact, the top searches in nearly half of the region’s countries are related to the retail or e-commerce industry.
The U.S. currently has the largest retail market in the world, although China is close on its heels. In 2021, America’s retail market was valued at over $6.5 trillion U.S. dollars.
Food was the top searched industry across South America, ranking number one in half the countries across the region. In Brazil, sweets took the top spot, which might not be surprising considering the country is the top sugar cane producer worldwide.
Clothing was also a popular business idea, taking the top spot in five South American countries.
Which countries surprised you the most with their new business interest?
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