“I can accept failure, but I can’t accept not trying.” – Michael Jordan
According to the Wall Street Journal, 400,000 Americans went to work for themselves last year. Many of them are young — between 25 and 40 — according to a report issued by Working Today, a non-profit organization that tracks such trends. One reason: Younger workers are having a hard time finding good jobs.
“Younger, less-experienced workers are definitely suffering more in this economy,” Bruce Tulgan, founder of the workplace-research firm Rainmaker Thinking, told USA Today. Workers who are above the age of 55 had a 3.9% unemployment rate in May of this year as compared with 5.6% among those ages 25 to 34 and 0.7% for 20- to 24-year-olds. But here’s a better, more hopeful reason for the trend toward “free-agency” work: Young people are beginning to realize that the time to fail is when you are young. You can go broke at 25 or 30 and still have plenty of time to recover and even become wealthy.
A good example: My No.1 son’s college roommate, Chris. A very bright, naturally likeable kid, he dropped out of Tulane to pursue day-trading when an opportunity (an inheritance) arose. I felt he should finish school and take a more “conservative” route. I warned him about the dangers of trading and predicted his demise.
Chris didn’t see his plan as anything but conservative. He allocated a small portion of his net worth to his trading account and spent his spare time learning systems and observing the market. He’s been day-trading for three or four years now and has a lifestyle most would envy. He lives simply (“I’m basically a cheap guy,” he told my wife), reading the financial press and working on his laptop three or four hours a day. Since he is a laptop entrepreneur, he can work from anywhere . . . and he does. Just yesterday, for example, he popped into our South Florida home to say “hello” to us.
He was in the middle of a road trip that was taking him from his home outside of Chicago down to Miami and back again. I asked him if it was difficult to travel. “I stay at Holiday Inns,” he explained. “That way, I’m assured clean, inexpensive lodging and high-speed Internet access. That’s all I need, really.” He seemed very happy with his profession.
An article on entrepreneurship in the July 12 issue of USA Today recounted the experience of a law student, Gil Silberman, who — at 28 — felt he “didn’t have time to become a partner in a major law firm,” so he started his own practice. Within three years, his practice had gotten “so hot” that it was bought out by a major firm. Now he’s a midlevel partner in that firm, a position it would have taken him 12-15 years to get otherwise.
This is a subject I’m going to cover in a book I’m writing on wealth building — the strategy of working on your own for a few years as a way to leapfrog over your peers and end up with a high-paying, senior position in a large, stable company. It’s an interesting subject . . . and a strategy that I’d consider seriously if I were young and desirous of having a great job with a major company.
Of course, there are downsides to working as a free agent. You have to pay for your own health insurance. You also have to do your own bookkeeping and accounting, at least in the beginning. (Though this can actually be a benefit. Because knowing your business from a numbers perspective gives you an advantage that will last as long as you are in business.) The biggest risk is failure. But what better time to fail than when you are young?
I’m trying not to start up any new businesses this year, but I can’t stop myself from thinking about them. When I imagine the “perfect” business, certain goals and objectives come to mind:
- I’d like to be able to run the business “on the run” — whether I’m staying at my home in Nicaragua, a hotel in New York, or my partner’s chateau in France.
- I don’t want to manage a big group of people. People problems are always the most difficult ones to handle. So my perfect new business would either have no employees or a CEO who would do the people managing for me.
- I don’t need to make more money (Thank you, gods that be!), but if I’m going to get into the game, I’d like the fun of being able to hit for the fence. So the business would have to have unlimited income potential.
- I’ve got to believe that what I’m doing — what the business is producing or providing — is good. I’m not looking to convert infidels. But I want to believe in the products or services I sell, because I’ve found that doing so makes work a pleasure.
It occurs to me that many of the young “free-agency” workers I know have these same goals and objectives in mind.