February 29, 2009
Sky's The Limit
- Established ventures illustrate potential in forced entrepreneurship
Crain's Business Magazine 
By JOEL HAMMOND
4:30 am, February 9, 2009
Layoff got you down? Want better control over your future?
It’s not a pipe dream, according to some Northeast
Ohio entrepreneurs who started their own ventures following
a layoff.
With hundreds of thousands of job losses nationwide, these
so-called forced entrepreneurs can serve as models for displaced
workers — or at least represent another option.
“Elective entrepreneurship probably won’t be
as prevalent as it would be in good times because optimism
fuels that,” said Steve Millard, president and executive
director of the Council of Smaller Enterprises. “But
coerced entrepreneurship will increase for folks who are out
of a job and need something to sustain their family. You’re
going to find people move to entrepreneurship who are being
downsized.”
That move won’t come easy, of course, but it can be
done, said Mark Hauserman, executive director of John Carroll
University’s Entrepreneurs Association.
Mr. Hauserman, who dismisses the notion that 80% of startups
go out of business within a year, said the key is to develop
a business model that reaches a revenue-generating stage quickly.
How to do that?
“You can’t start from scratch,” said Ron
Finklestein, president and CEO of Akron-based business and
executive coach company Akris LLC who in 2001 was laid off
from Xerox Connect in Garfield Heights. “You have to
partner with or seek out someone with institutional knowledge,
so you can short-circuit the learning curve.”
There’s also an attitude shift, said both Mr. Finklestein
and Mike Berlin, founder and managing member of BriteSkies
LLC, a downtown Cleveland-based software integration outfit.
Mr. Berlin, laid off in 2000 from Internet consulting company
marchFIRST, started BriteSkies with the four-week severance
he received and the laptop and domain name he then bought.
“If you’re great at what you do, that doesn’t
mean you’ll have a good business,” Mr. Berlin
said. “Technical expertise is not business acumen. I
had to go from a computer guy to a business owner.”
Taking the good with the bad
Fear never registered for Patricia Klavora, the owner of
Cleveland-based Marketing 360 Group LLC, who said she has
found more stability in her new role — providing small
and midsize businesses with marketing assistance. Ms. Klavora
was laid off in 2005 from her marketing specialist position
at FirstEnergy Corp.
“I’d already lost my job; how much worse could
the fear get?” Ms. Klavora asked. “It’s
up to me to get the business, and you never lose it all at
once. Ironically, there may be more stability in this line
of work.”
Linda Winick, who started Cost Control Consultants in 2008
after 13 years at AT&T, touted that control as a major
benefit. Ms. Winick’s department was eliminated, and
although she was offered a job in a different area of the
company, it would have meant a commute that was 45 minutes
longer and a 40% pay cut, she said.
In the end, Ms. Winick, whose company audits businesses’
utility and telecommunications bills, said she was lured by
the idea of making her hard work and long hours pay off for
herself, not another company.
“Loyalty’s a one-way street,” Ms. Winick
said. “The timing was right; I needed to control my
own destiny. I directly benefit from what I do. I can make
my own schedule and decide who I want to work with.”
While the control that comes with forced entrepreneurship
can be a positive, the responsibility involved can be a negative.
For example, gone are the days of turning off your cell phone
when you get home, said Kristy Amy, president and founder
of OnMark Solutions, an e-marketing company in Westlake.
She started the company after she was laid off while pregnant
with her second child, and she has since had a third.
“There’s no such thing as maternity leave when
you work for yourself,” Ms. Amy said. “If you
want to keep the business going, you have to keep working.”
The same outside forces that resulted in entrepreneurial
candidates’ job losses can also play a role in startups’
success or lack thereof, a struggle Joel Libava fights.
Mr. Libava, the president of Cleveland-based Franchise Selections
Specialists Inc., said he has long bemoaned the region’s
stagnation. Typical of many entrepreneurs whose roles require
them to create their own businesses, Mr. Libava said clients
aren’t always beating down his door, especially in the
Cleveland area.
“Being in an area that’s not dynamic is frustrating,”
Mr. Libava said. “People are not moving here; people
are moving away. It’s frustrating that we live in a
fairly conservative area that needs help.”
Even at school
In a unique twist, even college students are being forced
to consider all their options, including entrepreneurship,
said Julie Messing, director of Kent State University’s
Center of Excellence for Entrepreneurship and Business Innovation.
Ms. Messing said students are seeing job opportunities dwindle
by the day, and pay for existing jobs is not in line with
what they want.
“Typically, students are here to learn about entrepreneurship,
then plan on joining the work force for five years to gain
experience, learn protocol and build their network,”
Ms. Messing said. “Instead, they’re looking at
this as a potential opportunity.”
John Carroll’s Mr. Hauserman said some consider entrepreneurship
because of their parents’ troubles.
“Kids have parents getting laid off from National City,
and they worry” Mr. Hauserman said. “They’re
seeing it as a lot of work, but they want to work for themselves.”
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