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The Current State of Small Business in 2023: Insights, Challenges, and Opportunities

If you’ve ever wanted to be your own boss, you’re in excellent company. A recent survey taken by thousands of small business owners, entrepreneurs, and members of the general public indicates that nearly four out of five Americans would prefer to be their own boss. Business ownership is a dream for many in the U.S. and beyond, but in 2023, turning that dream into a reality can still prove challenging for some. Here, we look at the state of small business in the U.S., identify trends and challenges facing today’s entrepreneurs, and look at the insights and opportunities that will shape the future of small business.

The State of Small Business

In the same survey mentioned above, 65% of respondents said they believe they have an “entrepreneurial mindset.” But what does that mean?

Having an entrepreneurial mindset means having passion, drive, and ambition. It also means knowing when to take calculated risks.

In fact, seven out of ten Americans are already running their own businesses — as a side hustle. Side gigs have surged in recent years as individuals look for smarter ways to make ends meet. Many operate as sole proprietorships without a legal business structure in place, which demonstrates the indestructible spirit of entrepreneurship. But what keeps these entrepreneurs from taking the leap and becoming state-recognized small business owners?

Blame the mighty dollar. Half of the survey respondents say that funding is the main obstacle standing in their way of starting a business. Others say they don’t have the support or resources they need or that they simply don’t know where to begin. However, nearly a third of respondents say they’re currently unsatisfied with their day job, which contributes to the continued interest in entrepreneurship.

Key Trends and Insights

Overall, we see that business ownership is still a desirable situation for many who feel discontented with working for someone else. And with nearly three-quarters of survey respondents saying they’ve come up with one or more business ideas in the past, there’s no shortage of creativity.

A different survey of small business owners confirms that entrepreneurship is the dream, with 72% saying that owning and running a business is worth all of the blood, sweat, and tears. Why put in all this effort? It’s about passion. They believe not only in themselves but in what they have to offer to their customers and their communities. In fact, an unequivocal 95% said if given the chance to do it all over again, they would absolutely say “yes” to entrepreneurship.

Key Challenges

While a vast majority of business owners say they have zero regrets, that doesn’t mean entrepreneurship is without hardships. Anyone entering the small business world knows there are risks involved, and most entrepreneurs share similar concerns.

The biggest hurdles business owners face in 2023 are inflation, disruptions to the supply chain, hiring and retaining talent, and maintaining overall finances.

Entrepreneurs are also concerned about the current state of the world and increasingly hot topics like mental health. In fact, a majority of small business owners say they would like to have less stress, anxiety, and issues with their own mental well-being.

Another challenge current business owners face is a lack of community. A surprising 58% say that, when starting out, they did not have access to critical support found amongst fellow business owners, nor the tools or resources needed for success.

Key Opportunities

Feeling that lack of connection? You’re not the only one, and this is an opportunity to find other business owners in the same boat. Tap into a community of like-minded entrepreneurs willing to share insights and lean on each other through tough times.

Why is this so important? Because 60% of entrepreneurs with access to a strong community say that their business is performing better than it did in previous years. In a concurrent 2023 survey, an overwhelming 91% of small business owners agreed that community is the key to business success. It cannot be overstated — community is inextricably linked to the future of small business.

What’s Next for Small Business Owners?

So, what’s ahead for small business owners and the entrepreneurial-minded? After these last few pandemic years, there’s been a surge in optimism, which feels like a breath of fresh air.

In fact, 65% of small business owners say their companies are doing better in 2023 than they were a year ago, and nearly half of all respondents say they see a rebound happening in the economy. The majority of business owners also plan to contribute to the overall economy by continuing to hire throughout the year. Most entrepreneurs foresee a rise in new businesses through 2023, and they’re predicting millennials and women to be the future faces of small businesses.

Is It Now or Never for Entrepreneurs? 

At some point, all successful entrepreneurs have had to take a leap into the unknown. While there will always be risks and challenges associated with small business ownership, there’s no time like the present. As the economy recovers and opportunities arise, this is your chance to engage with your community and become one of this year’s fearless entrepreneurs.

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