We have dealt with generational differences before. It is possible that what we are seeing is a trickle-down effect of the social climate 40 years ago. If people are raised in an atmosphere of affluence, and have little contact with reality, then the explanation might be that the people who were in their 30's in 2000 would rather work 8-5 at a big company for good money than to (work their butts off to) innovate on their own. (We are seeing this in recent MD's - most of them want to work for hospitals, do not start their own practices, and do little overtime.)

Jan

Any university that offers these basket weaving courses, especially as a major, should be shut down.

That's likely to be the end result: offshoring from day 1.

No we are not dealing with a comparable rate of start-ups, at least in the important technology sectors. Between SOX and the weakening of our patent system, startups cannot obtain the capital to take on important high quality projects.

The game has been rigged (via law) to crush competition by smaller innovative companies. This also discourages innovators from forming such companies. Those who do are played with by Wall St until they have extracted all their resources,. Those fine innovators who are now failures in their own minds end up as slaves to the looters who arranged to legally steal the inventors production and self respect.
Wall St and its corruption must die for productivity to return.

Looking at the graphs, what is striking to me is that our 'current ho-hum economy' stats are below those of the past that marked times we now label as economically catastrophic. So what we now consider normal, we consider abysmal in the past.

The information given is a bit downstream of the startpoint, I note: I would also be interested in knowing what the rate of <1yr startups is. Are we dealing with a comparable rate of initial startups and an increased failure rate? Or are people not even sticking their toe in the water any more?

Jan

Actually, the title pretty much says it all.
When I first went into business in the 60s, I did so on a wing and a prayer. My total assets were just enough to get started and a few thousand for money to feed the family. My biggest asset was me. I couldn't begin to do that today. I was located in a strip center in which the office supply store, the restaurant, and a barber shop were all started on a shoestring like me. They all became successful. I remember being angry over the fact that I had to pay for an occupancy permit ($100.). Ha! I'll bet anyone today would settle for that in a heartbeat.

Maybe we need to mandate startups like minority quotas or fleet average fuel economy? There must be something the government can do...America Invents?

We have a recommendation Government: Get out of the way!

BTW, I bet the graph on successful startups has a different shape.

Startup restrictions and costs have gotten bigger and bigger. This is my last startup. It's just too much hassle. Time to shrug has arrived

You are so right! Currently, just as one example, Oklahoma has 85,000 jobs that can't be filled because they can't find qualified candidates for IT and biological research positions, or even truck drivers. I'm sure there are other states with the same problem, but I'm also sure we have lots of college grads with degrees in ethnic studies flipping burgers.

you can not have startup companies if the people are un educated. thank the government for this situation because they control the schools and the student body is NOT taught to think. all one has to do is look at the arab world to see the result of eons of what happens when the youth is exposed to government schools. the decline in the usa will continue to continue its downward spiral untile we enter the savage stage.

The 90's were an unusual era with the dot com boom. With the internet being new and the potential for a company to quickly reach millions of customers there was a lot of excitement about getting in on the ground floor.

Of course, the reality is that getting in on the ground floor often leaves you on the ground floor. I have a 1979 issue of Byte magazine, containing ads for all of the dominant companies in the then new microcomputer industry. Some, at the time well known companies had two page spreads. All of those companies are now gone, the only recognizable company is one that had a quarter page ad promoting the memory board they were selling - Microsoft.

When the investors learned that a company losing millions of dollars a year on the internet but growing was not a sure thing, they became disillusioned -- and rightly so, many of those "high fliers" never made a buck. And so we have the dot com crash.

In the years since 2000 it's been harder to sell investors on your latest internet idea -- and the obvious ones were taken in the first few years. There is still, of course, the opportunity
to have the next great idea, but selling it is harder. Investors expect you to MAKE money.

And, of course Sarbanes Oxley certainly hasn't helped.

If my current project pans out, it goes offshore to a no income tax country. Profits in income tax countries will be very predictably low. I gladly support the American ideals that I was taught, but the United States does not embody, promote, or defend those ideals. I would rather produce less and starve the looters. Wonder where that idea came from.

I am not an expert and it depends on the business, however Honk Kong and Singapore are probably good places to look at.

Technology start-up companies are built on three foundations: intellectual capital, financial capital, and human capital. All three of the pillars have been under attack since 2000. Our patent laws have been weakened reducing the value of intellectual capital. Sarbanes Oxley has made it impossible to go public reducing financial capital for start-ups and the FASB rules on stock options have made it harder to attract human capital to start-ups.


The Decline and Fall of the American Entrepreneur: How Little Known Laws and Regulations are Killing Innovation http://www.amazon.com/Decline-Fall-Am..., explains these problems in more detail.