Have you ever wanted to just quit your day job and be your own boss?

Come on. You know you thought about it.

Many of us out there have a passion we love so much that we wish we could turn into a full-time career. Well, frankly, the time to do that may never be better than right now.

In fact, almost half of everyone that left their jobs last year to start a business did so because they wanted to be their own boss. So, you wanting to follow your passion and be the one in charge isn’t exactly revolutionary.

But, it is possible.

I discussed the state of small business with David Nilssenrecently. He’s the CEO of Guidant Financial and he provided some helpful tips for those looking to make the monumental change of hanging their own shingle.

Guidant along with LendingClub put out an interesting survey recently that provides a look at the landscape for those wanting to go into business for themselves and the results are rather interesting. Also, make sure to check out the infographic at the end of this article that provides a summary of their findings. I think you will be as fascinated by what they found as I am.

David Domzalski: Can you give us a brief description of what Guidant Financial and LendingClub are trying to accomplish with this survey? 

David Nilssen: Both Guidant and LendingClub play an important role in helping new and existing entrepreneurs find capital. The annual State of Small Business survey gives us a broader understanding of the challenges and opportunities Main Street American small businesses face today. Our findings in this year’s survey were significant! The survey showcases the economic and political optimism that this country is experiencing and demonstrates that anyone from any corner of the United States, from any economic and socio-economic background, can become their own boss and thrive in the current economic state.

This year, we decided to partner with LendingClub to expand our sample size to more than 2,600 small business owners. Their expertise in connecting the online marketplace of borrowers and investors to deliver affordable access to credit was one of the many reasons we decided they would be a best fit for our survey this year. We’re both in the business of empowering small businesses to succeed.

Domzalski: In your survey, you cite an 18% increase in women opening small businesses.  Do you know what industries these companies are in?

Nilssen: This survey found women are opening up businesses in the following industries:

• Health/Beauty/Fitness (12% of respondents)
• General Retail and Business Services (tied; 11% of respondents)
• Food/Restaurant (9% of respondents)
• Cleaning and Maintenance (4% of respondents)

Domzalski: Why do you think these small business owners are “ready to be their own boss”? Did anyone mention anything specifically?

Nilssen: There were a handful of reasons why so many people decided to become their own boss last year. We saw everything from respondents ready to take the plunge and follow their passion to those tired of corporate America and ready to change their pace of life. Those who decided to become their own boss rated their overall happiness an average of eight out of a scale of 10.  Two examples of people becoming their own boss include:

• Suzie and Todd Ford – Suzie Ford was a banker out of work and Todd, her husband, was an airline pilot who never saw his family, but loved to brew beer at home. They were both ready for change. They learned they could use their retirement funds to start their own brewery and have never looked back. Now, they’re the proud owners of the thriving NoDa Brewing Company, blazing a trail for craft brewers in their region. They now have two locations in Charlotte, NC. See a video of the Fords here.
• Skip Sheppard – After working in the publishing industry for many years, Sheppard decided to take control of his career and become a small business owner. His lifelong passion for fishing and boating turned into a second career when he used his retirement funds to purchase and rejuvenate a successful fishing supply shop, Three Lantern Marine. See a video of Sheppard here.

Domzalski: I noticed the top industry being “Business Services.” What types of services are most businesses offering?

Nilssen: The most common ones we see are corporate janitorial services, pack and ship facilities, print shops and so on. These are services most businesses need so there is infinite opportunity.

Domzalski: Were any of the respondents online entrepreneurs? If so, what types of businesses were they involved in?

Nilssen: Our target market are brick and mortar, Main Street America small businesses.  There are some internet entrepreneurs included – but it’s not the core customer.

Domzalski: Can you explain the 401(k) Rollovers for Business Startups (ROBS)? How does that work for someone who wants to start a business this year?

Nilssen: With 401(k) business financing (formally known as Rollovers for Business Start-ups, or ROBS), you can use funds from an IRA or 401(k) to invest in a small business or franchise without taking a taxable distribution or getting a loan.

By starting your business debt-free, it removes the burden of having to make monthly payments as you launch your business, allowing you to be profitable sooner. Plus, 401(k) business funding doesn’t trigger an early withdrawal fee or tax penalties, so you can continue to save for retirement while building your business.

And, the whole process can be as quick as three weeks, so someone who wants to start a business this year has plenty of time to do so.

Domzalski: What is something people don’t understand about starting their own business that they probably should?

Nilssen: Well, first of all, most people don’t realize that they can start or buy a business (including a franchise) with retirement funds. Another thing folks may not realize at first is that buying a franchise can be a smart way to become a business owner without being completely on your own – you enjoy the luxury of a proven system and receive support throughout.

Besides that, we have customers come to us all the time inquiring how and where do they even start when it comes to financing and starting their own business. As a result, we developed a 10-step list for entrepreneurs and small business owners to refer to when kicking their business off the ground. The full e-book, 10 Steps to Starting a Business, can be found here. Some of the recommendations include:

• Develop a master plan: Businesses with a well-thought-out plan grow faster because they know exactly what’s working and what’s not. Start by educating yourself and understanding the four essential considerations lenders look for when you apply for a business loan.
• Location: Choose a destination for your business that makes sense for the industry you are in. Be sure to familiarize yourself with local commercial real estate landscape.
• Secure funding: There is a bevy of financing options and incentives available to first-time business owners. Do your homework to find the method that works best for you. Consider traditional loans, unsecured credit, Rollovers for Business Start-ups, crowdfunding and others.
• Domzalski: What about the political climate has business owners optimistic?
• Nilssen: Right now, there is a pro-business, less regulatory environment in Washington, D.C., with the recent tax reform, a bull market and sufficient access to funding and capital. The economy is seeing solid growth with unemployment remaining low. Despite a year of political turbulence, natural disasters and the largest tax reform in a decade, small business trends point to increased economic optimism and confidence and plans for growth in the new year.
• Domzalski: Outside of tax preparation, what other services are outsourced by small business owners?
• Nilssen: Our survey showed that tax preparation, CPA, payroll, and bookkeeping (in that order) are some of the top services that small business owners outsource to third-party vendors. Which is no surprise. In fact, our mission is to increase the number of people that succeed in small business. In addition to funding, we introduce our clients to best-in-class service providers to help simplify the number of decisions they must make at launch. The more they can focus on growing or improving the business, the better.
• Domzalski: Of the top five states cited in the survey, which industries are most popular?
• Nilssen: Below is an outlook by state on which industry was the most popular:
  • California
    • Food/Restaurant and General Retail (tied; 9%)
    • Health/Beauty/Fitness (8%)
    • Technology (7%)
    • Sports and Recreation (5%)
  • Florida
    • Business Services (9%)
    • Food/Restaurant (8%)
    • Health/Beauty/Fitness (8%)
    • Automotive (8%)
    • Technology (7%)
  • Texas
    • Business Services (14%)
    • Health/Beauty/Fitness (10%)
    • General Retail and Food/Restaurant (tied; 8%)
    • Automotive (7%)
  • New York
    • Food/Restaurant (11%)
    • Automotive (11%)
    • Technology (10%)
    • General Retail (8%)
    • Travel/Lodging (5%)
  • Illinois
    • Food/Restaurant (18%)
    • Automotive (12%)
    • Business Services (10%)
    • Health/Beauty/Fitness (7%)
    • Education (4%)

   

• Domzalski: What do you want America to take away from this survey? Why do these results matter?
• Nilssen: Both Guidant Financial and LendingClub hope that this survey offers a glimpse into Main Street American small businesses and offers aspiring entrepreneurs the motivation to dive into business ownership.
• Domzalski: Guidant Financial was a startup itself in 2003. What message do you want to send to small business owners and those thinking of starting their own business? For those thinking about making the transition, they have families and full time jobs. What do you want them to know before making that leap?
• Nilssen: Guidant was founded on the core value of PACE (Passion, Adaptability, Community and Excellence). We want our customers and future customers to know we fully support your dream to go out on your own and have the confidence that it can be done.With more than 15 years of experience under our belt and being a former startup ourselves, we fully understand the exciting and challenging things business owners experience. We’ve been there and we’re here to see you through those ups and those downs.

  That’s why we take an educational and transparent approach to small business and franchise financing. It’s important that an entrepreneur go into small business with “eyes wide open” so they can make good decisions and ultimately create the life you want.