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A

lot of great things can come your way if you choose to become an entrepreneur. You can follow your passion, make a lot of customers happy, and fulfill your goals. And while the human element of entrepreneurship is very important, today we’re focusing on the numbers that paint a larger image of what it’s all about. If you’re an entrepreneur or wantrepreneur, read on to learn 21 vital small business statistics.

What is a small business?

We define small business the same way many others do: “a business with fewer than 500 employees.” However, this definition does not tell the full story. The Small Business Administration notes that there isn’t one simple definition for what the term means as it varies according to industry--some small businesses can even have up to 1,500 employees.  Here are some examples of what a “small business” constitutes in different industries:  

     
  • Agriculture: A maximum of $750,000 in average receipts.
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  • Construction: No more than $36.5 million in average receipts.
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  • Wholesale Trade: The maximum number of employees is between 100 and 250.
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  • Finance and Insurance: A maximum of 1,500 employees, and no more than $32.5 million to $38.5 million in average annual receipts.

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Small Business statistics

As you can see, defining what a small business exactly entails is complicated. If you’d like to learn more on the matter, click here.  Keep reading to learn all the small business stats you need including the good, the bad, and the ugly.

Success Rates
     
  • Roughly two-thirds of businesses are still around two years in.
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  • About 50% of small businesses are still open after five years.
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  • Entrepreneurs who own a home are roughly 10% more likely to open a business than those who don’t.
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  • Cash flow is one of the biggest considerations for entrepreneurs as 82% of businesses fail because of cash flow problems.
Salary Expectations
Freelancers Stats
Small Business Financing
Startup Funding
     
  • The average startup launches with $10,000.
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  • A third of them start with less than $5,000.
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  • The average seed round is about $40 million.
Women-Owned Business
     
  • Women own about 40% of businesses in the U.S.
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  • Businesses run by women generate $1.8 trillion in revenue.
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  • Women of color amount to 47% of all women-owned businesses.
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  • Roughly 25% of women are likely to seek out financing for their business (this figure is 34% for men). Women use more credit cards, while men use equity investors.
Other Groups

The Takeaway

There are more small businesses popping up every day as being an entrepreneur is becoming a more viable way of making a living in the U.S. every day. From startup founders to freelancers, we hope these stats will give you a good idea of what you can expect if you’re running a small business, or plan on launching one soon.

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