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Are American Entrepreneurs on the Decline? Moonlighting Research Says No.

Posted on 8.08.2013

:: By Eddie Machaalani, Bigcommerce ::


Even though the economy looks like it’s finally starting to turn around, the hard truth is many Americans are having to work harder to do as well as they did before the recession. A recent survey by my company, Bigcommerce, proves that premise. Moonlighting is on the rise among entrepreneurs in the Internet economy.

That’s in stark opposition to a recent Wall Street Journal article, which claimed that Americans are becoming more risk averse and less entrepreneurial when it comes to work. The article cited findings by the U.S. Labor Department that more American adults were staying in their jobs longer – 53 percent have been in the same job for at least five years. The article also cited statistics that venture capital investment in new business has dropped by 10 percent in a single year.

Come on. If fewer business ideas are getting funded, it’s no wonder that more people are staying in their jobs longer. That doesn’t mean Americans are less entrepreneurial than before. It just means business startups are changing back from angel-backed flavors of the moment to the classic model of bootstrapped individuals working long hours to make their dreams a reality.

New Internet business owners are moonlighting to create a second source of income, selling merchandise online and using their full or part-time job to provide a safety net as they grow.

Over the course of three months, Bigcommerce (the company I run with my Co-CEO Mitchell Harper) conducted a study with almost 20,000 of our “indie” online retail clients. We found that a surprisingly large number of those we surveyed were clocking in considerable time outside standard nine-to-five business hours.

In fact, 30-35 percent of our business clients were hard at work between 6 p.m. and 8 a.m. Central Time; much of that work actually happened after midnight.

Not only were people working moonlight hours; an appreciable number were putting in heroic effort all day long and straight through the evening. Most of the entrepreneurs in the study find noon to be their peak work time; nearly 80 percent of people are working on their stores at that time. Yet more than 49 percent were still putting in the hours at midnight – 12 full hours after their peak busiest time. At 3 p.m., almost half of online retailers were working; 25 percent were still going strong at 3 a.m..

How did the numbers break down nationally?

• The largest group of moonlighters —33 percent of those surveyed — are in the South (with Florida, Georgia and Texas leading the pack).

• West Coast moonlighters (led by Arizona, Colorado and California) account for 27 percent of the whole.

• The Northeast represented 24 percent of the total (with New Jersey, New York, Pennsylvania and Washington, D.C. in the lead).

• Midwest moonlighters comprised 15 percent of the group (led by Michigan, Illinois and Ohio).

It’s pretty clear from these kinds of numbers that people building businesses in the Internet economy are not afraid of hard work and putting in the hours required to get their companies off the ground.

Contrary to what the Wall Street Journal would have us believe, statistics about work trends should not be read as risk aversion or a weakening of the American entrepreneurial spirit. Business owners in general are grinding through longer work days than they may have in the past.

But it’s a simple fact of the economy that unemployment rates haven’t changed much in over a year. With fewer venture capitalists backing new business ideas, American breadwinners are smart to hold on to their current jobs to support their families while they build their own businesses. Startup capital has to come from somewhere, which is why moonlighting is now returning as a proven model for business growth. Staying in your current job while building a second business lets you bootstrap your operation without giving up the income – and benefits – that your family needs to survive.

Fortunately for Internet entrepreneurs, the cost to get a fully functional online store up and running are relatively low – about all you need is an Internet connection, a credit card, and the willingness to put in the time that success requires.

Are Americans becoming more risk averse and less entrepreneurial? Based on what we’ve heard from 20,000 hard-working Internet business owners, we think the obvious answer is “not one bit.”


Eddie Machaalani is Co-CEO of Bigcommerce. He can be reached at eddie.machaalani@bigcommerce.com, Twitter handle @eddiemachaalani.

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