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IRVINE, Calif. (May 7, 2015) – Sage North America, a leading provider of business management software and services to small and medium-sized businesses, today announced the findings of its 2015 Sage State of the Startup Survey, part of the Sage SMB Slant research series. Conducted during March 2015, the State of the Startup Survey provides deep insight into the motivation, business practices and performance of 524 new business startups in the U.S. and Canada. The study also canvased senior executives in firms who routinely counsel, invest in and generally nurture startups, such as accountants, investors and attorneys.
Tweet This: Startup owners and advisors tell it like it is. Get the scoop in the Sage State of the #Startup Survey: http://sge.bz/1IwIdYc.
"Comprising half the workforce and most of the companies around the world, small businesses are the heartbeat of the North American economy," said Connie Certusi, executive vice president, Small Business Solutions, Sage North America. "Sage wanted to dive deeply into how small business startups work, what makes the very best small businesses succeed, and best practices that will help other new businesses."
Most State of the Startup survey respondents have no prior startup experience, and money is not their primary motivating factor. Fifty-nine percent of respondents wanted to be their own boss, 48 percent were following a passion they wanted to turn into a business, and 39 percent were driven by a "burning desire to work for myself."
Women are more likely to found startups than men (57 percent versus 43 percent), and contradicting conventional wisdom about the conflict woman face when it comes to business and family, most women (55 percent) reported a "great" work-life balance.
Gen X-ers make up the highest percentage of startup founders (55 percent), while Boomers are 31 percent more likely to say it was "somewhat" to "extremely easy" to start their business than Millennials.
The most striking difference among generations was their engagement with marketing functions, especially social. Boomers are 2.4 times less likely than Millennials to use social media marketing tactics.
The top three challenges experienced by startup founders are growing revenue (46 percent), acquiring customers (42 percent) and securing capital (41 percent).
In order to discover the secrets of why some startups thrive while others struggle, Sage grouped the startup founders into tiers based on their companies' performance against a key set of business metrics.
The top-tier startups are more profitable, growing faster and more aggressively hiring. In fact, 91 percent reported they have met their initial business goals, compared to just 12 percent of the bottom tier.
These successful entrepreneurs can teach new founders several lessons:
Nurturers reported that two of five startups eventually fail. They say the top three mistakes made by founders are taking on too much debt, not conducting adequate market research and an inability to control costs. They advise focusing on marketing, business networking and market research to enhance their chance of success.
According to the nurturers, new businesses most often struggle with growing revenue, adding customers and producing accurate financials. Thirty-six percent of advisors don’t trust the financials they receive from entrepreneurs; 79 percent suggest that new businesses buy commercial accounting software and use an accountant.
The founders and nurturers provided best practices that can guide any new business or entrepreneur:
In March 2015, Sage commissioned two in-depth studies on new businesses. Strop Insights canvassed 524 new business startups in North America and interviewed founders who had launched their companies within the past five years. ReRez Research spoke with 102 senior executives who work at firms who routinely counsel, invest in and generally nurture startups. These nurturers are all based in the U.S. The survey has a 95 percent confidence of error +/- 4.28 percent.
We provide small and medium sized organisations, and mid-market companies with a range of easy-to-use, secure and efficient business management software and services—from accounting, HR and payroll, to payments, enterprise resource planning and customer relationship management. Our customers receive continuous advice and support through our global network of local experts to help them solve their business problems, giving them the confidence to achieve their business ambitions. Formed in 1981, Sage was floated on the London Stock Exchange in 1989 and entered the FTSE 100 in 1999. Sage has millions of customers and circa 13,000 employees in 23 countries covering the UK & Ireland, mainland Europe, North America, South Africa, Australia, Asia and Brazil.
For more information about Sage in North America, please visit the company website at www.sage.com. Follow Sage North America on Facebook, Facebook.com/Sage, and Twitter, Twitter.com/SageNAmerica.
©2015 Sage Software, Inc. All rights reserved. Sage, the Sage logos, and the Sage product and service names mentioned herein are registered trademarks or trademarks of Sage Software, Inc. or its affiliated entities. All other trademarks are the property of their respective owners.
Cynthia Sutton Sage North America 571-213-0401 [email protected]