What are the main reasons to create a company?

After the post we published 2 weeks ago on why companies fail, another interesting piece of statistics published by the French National Institute for Statistics (INSEE) regards the motivations of people to start their company and how these motivations have evolved since 2006. You’ll find the complete table below (we did the translations ourselves given that those interesting statistics are unfortunately only available in French).

There are a few interesting insights out of this survey.

The TOP 3 reasons to become an entrepreneur

Not surprisingly the 3 main reasons to start a business are respectively:

1. become independent
2. willingness to face new challenges
3. make money

More surprising is however that only 14.3% of entrepreneurs who have started a company in 2010 declared that it’s the idea of a new product or service which motivated them to start a company. It’s therefore like if having an idea of new product or service was not seen as absolutely necessary to start a business and fulfill the TOP3 reasons. Pretty strange and it may explain why there are so many me-too’s

What changed between 2010 and 2006 in terms of motivation to create a company

Basically, as you can see from the table, the ranking of the different motivation factors didn’t change very much in 4 years time. However some differences can be seen as far as the factors “Willingness to be an entrepreneur and confront new challenges” and “Opportunity of creation” are concerned. Significant changes can be witnessed between 2006 and 2010.

The “Willingness to be an entrepreneur and confront new challenges” went up between 2006 and 2010 from 38.7% to 44.2% (almost 6 points difference ) and opportunities of creation were leveraged in 22.6% of the cases in 2010 (15.9% in 2006).

At the same time losing his job was a motivational factor for 23.1% of new entrepreneurs in 2006 and only for 20% of them in 2010. Do you see any effect of the crisis here? Although the financial crisis led to higher unemployment rates, being jobless seems not to have evolved in the same direction as far as startup creation is concerned.

By Pierre-Nicolas Schwab Dr. Pierre-Nicolas Schwab is the founder of IntoTheMinds. He specializes in e-commerce, retail and logistics. He is also a research fellow in the marketing department of the Free University of Brussels and acts as a coach for several startups and public organizations. He holds a PhD in Marketing, a MBA in Finance, and a MSc in Chemistry. He can be contacted by email, Linkedin or by phone (+32 486 42 79 42)