Gen-X Goal: Be Your Own Boss
Age of Profits
| LITTLE ROCK, ARK.
Adam Frith and John Newbern have a goal: to stay self-employed.
Nearly two years ago, they opened Sufficient Grounds, a funky two-story restaurant and cafe in the artsy Little Rock, Ark., neighborhood of Hillcrest. They created a place with oversized leather furniture, abstract art, and chartreuse walls where people can loll away the hours over a game of Trivial Pursuit and a plateful of quiche.
"We knew we could fill a niche here," Mr. Newbern says. "We wanted a place where people didn't feel like they had to be in a hurry to leave. People stay for hours."
To bring a bit of SoHo to the South, the two took big risks. They gave up well-paying day jobs and had to secure a loan. But Newbern and Mr. Frith are not alone among Generation Xers. In fact, according to one study, Americans under 30 are more likely to start or buy new businesses than any other age group. Rather than living up to the image of apathetic twentysomethings with little taste for anything but flannel and MTV, these Gen-Xers are making sacrifices so that they can say goodbye to someone else signing their paychecks.
"A lot of the Gen-Xers, like many of those before them, want to build and create something in their own image," says Jim Weidman, spokesman of the National Federation of Independent Business (NFIB). "They want to be able to have control over their time, even though they may work 60-hour weeks."
But Gen-Xers have shown even more entrepreneurial zeal than their predecessors did. "Common wisdom has held the prime age of someone starting a business was in the 30s and late 40s, after people have had a chance to get business experience, make contacts and amass working capital," says William Dennis, the author of a report by the NFIB's Education Foundation and Wells Fargo Bank on start-up businesses. "The biggest surprise [of the study] was the sheer number of twentysomethings striking out on their own."
Indeed, according to Mr. Dennis's study, more than 1.5 million of the 5 million people who started businesses in 1996 hadn't reached their 30th birthday. Nearly 800,000 were under 25, and 47 percent of all new businesses in 1996 were started by people under 35.
What drives Generation X
Observers also note another difference from the past. "Unlike maybe other generations, relatively few are doing it for the money," says Mr. Weidman.
Like Frith and Newbern, the majority of Generation X business owners do not see themselves becoming incredibly wealthy. The idea of a 1950s-style abundance and happiness doesn't propel them to get out of bed in the morning. Instead, their drive stems from images - success followed by layoffs - they saw growing up in the 1980s. Loyalty, job security, and paying one's dues for unspecified future rewards are in the past. While living comfortably in suburbia with the happy family may have been the goal of past generations, Generation X isn't waiting to receive a gold watch from the firm and enjoy company picnics.
"There's no guarantee of longevity in a company these days," says Frith. "There's only so far you can go when you work for someone else. Potential is here."
And increasingly, young entrepreneurs are finding their opportunities in medium-size cities like Little Rock. Known more for the glaring 1957 civil rights crisis than as an on-ramp for the bridge to the 21st century, today the city is experiencing a burst of revitalization, thanks in large part to the election of President Clinton. A thriving cultural scene mixes with a constant fascination for politics. With a population of 175,000, it seems everyone in Little Rock has a mutual friend, creating a tight-knit atmosphere. More and more young people are networking these connections to create opportunity.
"It's easy to do in Little Rock," says Frith. "The competition is less fierce than in a larger city. The cost of living is low. You have a chance to bring something new here - to be the first to do it - and then make a success of it."
Times have changed
But it's not just location. A host of other factors are also helping boost this new cache of young entrepreneurs. The day when a seasoned businessman in his 40s must pay his dues before even hanging a shingle has vanished, says Weidman. Today, entrepreneurs can bypass a bank to get a loan and finance a small enterprise from savings or a family loan. Many Xers also choose businesses with low overhead or transform a hobby like Web design into a thriving business.
That's what Karl Straub has done. He owns Eplex, a Web-hosting company in Little Rock, but his client base circles the globe from Norway to Costa Rica. After attending Duke University in Durham, N.C., and working in Washington for a United States senator, Mr. Straub returned to Little Rock in 1993 and decided to open his business at age 28.
"I knew the Internet was revolutionary and that I could stay in Little Rock, live cheap, and work globally," Straub says. "It's not uncommon to work from 8 a.m. to 2 a.m., but I can take a two-hour break and no one is breathing down my neck. If I don't work, I'm only hurting myself."
And that freedom from time cards and sense of responsibility is what has lured many Gen-Xers to ownership. It's a question of control and priorities, Frith adds.
"Our generation is waiting longer to get married, and that gives us time to focus on starting a business and making it succeed," he says. "It's our choice to sacrifice a social life. There are no stars in our eyes. The bottom line isn't about money. If we are going to work hard, we might as well do it for ourselves."