Afraid of layoffs, they ready biz plans
TEXT OF STORY
Kai Ryssdal: More than half-a-million jobs are disappearing from this economy every month. People who still do have some place to go in the mornings are worried that soon they might not. So some of them are dusting off business plans and launching their own startups as they try to get ready for life after the pink slip. Marketplace’s Mitchell Hartman reports from the Entrepreneurship Desk at Oregon Public Broadcasting.
MITCHELL HARTMAN: Call them “preemptive entrepreneurs.” The young bankers thinking about a metal-extrusion business. The cousins in a struggling family firm who’ve launched a construction company on the side. The woman plowing her severance package into a green-cleaning service.
And LaNorma Huggins-Hopes, who’s not feeling secure about much of anything in her job at Northrup Grumman right now, besides her next few paychecks.
LaNorma HUGGINS-HOPES: They’re doing a lot of reorganizing and a lot of downsizing, so you’re kinda like on pins and needles as to whether your job will still be there.
Huggins-Hopes is 43, she’s managed federal contracts at Northrup in Virginia since 2006. Last year, she decided to take the entrepreneurial plunge.
HUGGINS-HOPES: I wanted to be the, determine my own fate when it comes to my finances, so I decided to create my own online jewelry business.
She’s designing original necklaces, bracelets, and the like, selling online and in local boutiques. She says it’s more or less a second full-time job, that she’s fitting in after hours.
Seven hundred miles away, in West Lafayette, Ind., Thom Davis also has a full-time job on the side. It’s a small business he started nice and slow — one wreck at a time.
Davis works for a marketing firm by day. Nights and weekends he deconstructs Mitsubishi sports cars. He tows a fresh one into his garage every month, strips it down, and sells the parts on eBay.
Davis says he’s not afraid for his job yet. But he doesn’t want to leave anything to chance.
THOM DAVIS: Right now, it is what I call “hobby income.” I’ve got a good amount of credit-card debt, I’ve got a house mortgage I’ve got to pay, I’ve got a second mortgage I’ve got to pay. I’ve got a choice: I can either just stop spending, or I can find another way to create value.
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Across the country, people who are trying to get ahead of the economic curve are getting help from the Kauffman Foundation. Monica Doss directs the program — a 10-week crash course in entrepreneurship.
MONICA DOSS: The people that are in jobs are already thinking about this: you know, I may want to go off on my own, or next time there’s a layoff, that’s going to be my signal to make a move.
Kauffman kicked off its FastTrac Launchpad program in New York City last month. Doss expected a 1,000 participants in the first year. Three hundred signed up in the first two weeks.
Doss says she’s seeing a new openness to entrepreneurship now, much more than during the downsizing waves of the ’80s and ’90s, or after the dot-com bubble.
DOSS: I think Americans are a very self-reliant people. And a lot of what we’re feeling is a sense that, you know: well, I couldn’t mess it up any worse than you did, in other words, Corporate America, or Banking America.
But stepping off that corporate treadmill is one thing. Getting your own treadmill started in this economy is something else.
HUGGINS-HOPES: This piece is created with different shapes of Swarovski crystals. And I crochet the wire . . .
LaNorma Huggins hopes jewelry operation is slowly gaining traction. She’s treating it like a serious startup, which means a lot of marketing and networking. Still, she’s not making anywhere near enough to quit her day job.
HUGGINS-HOPES: As far as earnings, I probably earn, I would say, between $5,000 to $10,000, like within the last two months.
But she thinks she could make it on her own, if sales keep growing.
Monica Doss of the Kauffman Foundation says building a business in a deep recession is fraught with risk. And the chances of failure are high. She says people with a business plan and financing model in place before they launch will have the best chance of turning “preemptive” into “stand-alone” entrepreneur.
I’m Mitchell Hartman for Marketplace.
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