Wisconsin entrepreneurs succeed by surviving in a competitive world
Depending on what’s measured, Wisconsin can rank as one of the nation’s worst states for entrepreneurial activity — or one of the best.
Sometimes, those extremes show up in the same national report.
Such is the case with the latest Ewing Marion Kauffman Foundation report on entrepreneurship in the United States, which once again ranked Wisconsin 25th among the nation’s 25 largest states for startup activity but second best in “Main Street” entrepreneurship.
How can that contrast be explained, some may ask?
One ranking measures the number of people who decide to become entrepreneurs within a given period (the startup rate), while the other measures the percentage of the adult population that owns a business as their main job (the Main Street rate).
Still confused? So are many observers, myself included, who struggle to understand how a low startup rate by Kauffman methodology translates into a relatively high percentage of business ownership. The answer may lie in one word: survivability.
As noted in the 2016 “Kauffman Index,” 6.46% of adults in Wisconsin own a business, roughly one in 16 adults. The percentage of firms that remained in operation through their first five years is also high at 50.77%, based on the latest reporting year.
Minnesota, a neighboring state to which Wisconsin is often compared, showed up with similar rankings in the Kauffman Index. It ranked 21st in startup activity and 1st in “Main Street” ownership, with 7.75% of Gopher state adults owning a business. The five-year survival rate is shockingly similar to the rate in Wisconsin: 50.76%.
Other large Midwest states studied by Kauffman included Illinois (19th in startups and 10th in Main Street ownership), Michigan (11th and 13th), and Indiana (22nd and 11th). Each state has a strong five-year business survival rate.
Conversely, some states with higher startup rates also lose more companies after five years. Texas, Florida, and California are ranked first, second, and third in startups but statistically lose more of them over time.
Is it Midwestern stubbornness that keep the survival rate high in Wisconsin? A stronger work ethic?
Perhaps each trait deserves some credit, but it may also be argued that startups in Wisconsin and surrounding states are doing a better job of reaching out for advice and resources that can keep them in business. The support system is strong and getting stronger by the year.
Providing a foundation for entrepreneurs to get the help they need is the goal of the annual Wisconsin Entrepreneurs’ Conference, which will be held June 6–7 at Union South in Madison.
The 15th annual conference will feature speakers, panel discussions, company presentations, and networking opportunities designed to connect entrepreneurs with the resources they need. Sometimes that means gaining access to investors, sometimes it means plugging into mentors, and sometimes it means meeting service professionals who understand business basics.
Entrepreneurs often learn the most, however, by listening to other entrepreneurs. Three featured speakers at the conference will provide that inspiration.
- Zach Halmstad is the co-founder of Jamf, an Eau Claire company that grew from two guys with an idea to a company with $110 million in annual revenue, 10,000 customers, eight offices in the United States and abroad, and 600 employees. Halmstad will receive the annual Ken Hendricks Memorial “Seize the Day” award and talk about his experiences in building a high-tech company in a mid-sized city. He will speak June 6.
- Arvind Subramanian is the chief executive officer for HealthMyne, a Madison-based company that is leaving a mark in the competitive world of health information technology and diagnostics. He’s nationally renowned, not only for his technical expertise, but for his ability to build successful companies. Subramanian will speak June 7.
- Alan Webber was the co-founder of Fast Company, a popular business and tech magazine that was the fastest-growing magazine in U.S. history. He’s the author of four books on business and entrepreneurship, including his latest, “Rules of Thumb: 52 Truths for Winning at Business Without Losing Your Self.” He will speak June 7.
Many people have good ideas for a business, service, or product, but not everyone can build a company and keep it alive. Giving Wisconsin’s tenacious entrepreneurs more tools to succeed is an underlying theme for the Wisconsin Entrepreneurs’ Conference.
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