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can you imagine the level of job creation we will have the level of stimulation of economy with just a few billion dollars being given to entrepreneurs rather than being poured into already matured industries that are burning that money they're literally burning it too many times as entrepreneurs ignore what's happening in the political world because we don't want to get dragged down into the mess but more today than ever before we need to have a voice otherwise we're gonna be left behind I started learn exactly for this reason so starting today with freedom Friday let me be your voice what's up you fighting entrepreneurs welcome back to another episode of freedom Friday this is your favorite person in the whole wide world onyx single and today we're gonna talk about proof that entrepreneurship is dying in America but what we can do to save it what I think we can do to save it at least a part of what I think we can do to save it alright it's gonna be a fun episode where we explore some controversial topics and you know push some buttons and hey listen I'm open to your arguments if you don't agree with me let's talk about it go to YouTube find this episode and there's comments below leave comments I've read them all and sometimes I reply and if you really really come at me I definitely reply alright so having said that listen come on are you a part of learn calm yet all l you are n.com we are putting entrepreneurs in there from all over the world we're about to cross 300 thousand as I film this and guess what we're gonna be putting 10 million people in there that's our goal over the next few years we're gonna get 10 million entrepreneurs from all over the world into that platform so you imagine the things that we can do together we not the government is gonna save this world we make change not the government's okay so we got to come together as entrepreneurs we are going to be building tons of social media features and the ability for you to connect with other entrepreneurs and listen we have to have a united voice so that's what learn is that's what I want to be if we want to make an impact in this world we need to be represented when it comes to the government and we're not we're not well represented there okay so come on alright now let's talk about the topic at hand proof that entrepreneurship is dying in America now I found this article it's a little outdated it's some you know but I still felt it was highly relevant it was over at Inc magazine was on so what I'm gonna do is in the show notes you can go to onic podcast.com ani k podcast com and you can see the link to the original article I picked out some of the parts that I thought were really really interesting so I kind of at my heart already knew that entrepreneurship is dying but this put some numbers and statistics behind it which were a little bit alarming now it also connected it back to big corporations and what they're doing and how that's impacting entrepreneurs and that blew my mind and if you look at historically what's happened in our country in the private equity world it all kind of fits together and it all comes together and becomes this this telling tale that makes sense so in this article I want to read the first stat here which was crazy so it said the US start-up rate has been falling for decades the Kauffman Foundation citing its own research and drawing on the US Census data concluded that the number of companies less than a year old has declined as a share of all businesses by nearly 44 percent since 1978 so when they look at total businesses in the country and they look at how many of them are less than one year old back from 1978 to today that ratio has dropped by 44 percent so that definitely tells you less people are starting new companies now we're gonna explore throughout this article we're gonna explore like why that could be happening so okay well let's get right into that so basically let's see there was this book I want to promote this book because it was awesome and I plan on reading it soon but I love the conclusion that they drew and how they went about it the book's title is where the jobs are entrepreneurship and the soul of the American economy they went out and they researched by interviewing 200 different founders and they found top 5 reasons why entrepreneurs are right now saying that there are less likely to start companies then back 20-30 years ago and I can connect and feel each one and I'm telling you right now with the policies that I'm seeing in our governments being issued every single year I am not seeing us move in the right direction now with the latest administration we've made some fixes but it's not been nearly enough okay so number one reason that was stated in sufficient capital access okay I'm telling you right now at learn I feel that we could grow so much quicker if it was easier for us to get capital I'll come back and talk about why it's been difficult for us to get capital I've not even tried because I know there's no point there was actual legislation passed by the Obama administration early on within the first year of him coming into office to try to resolve the banking problem I'm Franklin Franklin Dodd act if I'm not correct if I'm not mistaken I'm Frank dot act or what I'm something like that that specifically barred banks from giving small businesses money it was a risk aversion technique it was nonsense it was completely anti entrepreneurs okay number two reason found was difficulty finding people with the right skills a hundred percent you know I mean getting great talent look hiring people getting people is not difficult getting people with an advanced level of skills at least and learn because we're in such a specific industry and such a specific niche it's tough it's it is tough that's probably not one of my biggest reasons but that is definitely up there number three now this was really interesting so I'm gonna spend some time talking about it number three was immigration policies that keep talent out now we know we've been having a lot of conversation about immigration lately and there are two very extreme sides on it now bar me for making an episode about immigration I don't have the guts to do that just yet maybe in the future but I do have some thoughts I have some very strong thoughts and feelings on it so I want to talk about it in respect to what I believe how it's impacting entrepreneurs I actually do think that our immigration policies are completely backwards and they're not set up in a way to grow the country to grow the economy they're set up the exact opposite all right number four I can't say this word onerous onerous basically bad taxes okay so heavy taxing huge but we've made major leaps and bounds in that area the last two years and it's been super helpful for learn it's been super helpful the way we're getting to write off things is making me it's making me want to invest more I'm actually spending more because I can write it off better which is obviously I'm sure I'm helping the economy and the GDP growth but also by dropping our taxes I'm able to give to my team more I'm able to give to my employees more last year we actually gave a Christmas bonus specifically because of the tax savings and the number five is regulations this one doesn't impact me as much I mean I know that if you're in a you're if you're in different industries like health and energy I mean like regulations are hard core our space digital publishing not so much so but these but these were five reasons and actually I was reading another study that specifically said that regulations because you know the Trump administration has been dropping regulations like crazy and business community this I'm just hearing what I'm hearing the business community is saying it's definitely helping so I've always heard and I saw another research paper that showed countries with more regulation more government involvement and free-market it definitely showed they have less entrepreneurship and less business growth I'm gonna take this page and put it to the side because I want to come back to it but I wanted to continue kind of going over some of the other stats that I read that were pretty crazy so in 1990 young people launched 33% of the startups out there okay so that's kind of cool a third of new companies were launched by whatever they define as young people they didn't say 20 and 30 oh sorry that's between 20 and 30 20 and 30 years of age 33% that's pretty huge but however recently it's less than 18% so that's dropping so means young people are not finding it advantageous to innovate and start new companies that you gotta understand if you go back in the history of this country the greatest innovations we've ever had we're from entrepreneurs I mean the phone you hold in your hand the computer you sit on was all entrepreneurs all right now pause all right because the next chunk of it talks about how big companies are sucking up the oxygen for entrepreneurs but before we do that let's talk a little bit about my ideas my thoughts on how we can reverse this negative impact how can we start to grow entrepreneurship in America again because I'll tell you right now if we don't fix if we don't mix this if we don't start to grow entrepreneurship in America again we are as a country are going to start to wither it's just the way it is if we are a free-market capitalist country we need entrepreneurs entrepreneurs are the backbone of employment are the backbone of the economy but right now what's happening is that's not growing and so number one insufficient access to capital I want to talk about this so it's discussed later in this in 2002 or mm mm I think there's a huge that stock bust right and massive bust it was like people lost their entire net like their life savings and VC's lost so so so much money VCS lost so much money I'm sorry I'm trying to look for something here if you hear a paper shuffling there was a massive culture in the late 1990s of new venture funding now of course it went crazy it was ridiculous right that's why we had the big bust because people were just giving money to anything to anyone but now unfortunately ladies and gentlemen we have a problem we've had the reverse issue Series A funding and C capital is down I'm trying to get you the exact data here yeah it's it's it's falling but the amount of investment that is going into round C D and E is doubled so let's talk about what that means when your company is getting brand new funding it's considered round a like there's seed capital that's usually a little bit some money a couple hundred thousand few hundred thousand then you go to series a series a is when you'll get your first larger chunk couple million three million now I can tell you because I'm invested in a company that went out to do it Series A and we were looking great amazing growth great growth great story and man we got smacked around left and right and it was crazy they're like now what we you know what near to early-stage for us we would like to hear see you back when you've like at least tripled your revenue and we're saying there look at them how do you expect us to triple our revenue we need someone to invest in us we have shown proof we have shown but it wasn't enough so even what we thought was proof enough wasn't imagine having no proof so the access to capital has vanished so people investors now this this behavior will be driven by investors right with investors like you and I so for me I don't I guess I don't want to put my money into brand new startups um if I'm nervous about mm happening again want to give it to companies that are already proven that are already working that have more security and that are looking like they're there they're maturing they're gonna IPO but then what about the new guys where they get their money from so I proposed something here to solve problem number one insufficient capital I've always wondered our government throws around billions of Fripp and flippin dollars everything oh this industry is falling apart your agriculture energy you know health banking the billions here billions here billions here hey how about this how about we establish a government-backed fund that's two or three billion dollars but here's how it works okay now I can hear you think all people would go in there and steal money and run away no what if the government comes along and says look this fund is available to basically offer a loan that is equal to the amount of the investment made into a seed or a series a fund series a company not BCD so this is only for early startups but what the government says is look if a VC puts in 2 million dollars into a company we as the government will give a 2 million dollar line of credit to said company here is where this protects the government and this protects the money from being misused a you know the VCS are putting their money in so they are going to do some level of due diligence they're not just gonna pour 2 million into it but this will really inspire VCS to put more money into Series A because they know that their money will get doubled and the company they put money into will have access to far more capital the second thing the government can do is put in some tracking against certain VCS so let's say they track failure rate in loan repayment so if there's a particular VC that seems to invest 80% of its companies never repay it alone well knock that VC out of the program imagine how much that would hurt the VC companies would never want to get funded by them because they wouldn't have access to this massive capital so VCS will keep it clean they will be checking deals they will be feeling good about them but they will want to explore series a more because there is this extra capital now you take half of that two three four billion dollars at the government sets aside and you make it for companies that are not VC back because look I'm not VC back learn is not but we should have capital so you put another term there so with them perhaps you put access to capital on people say where's SBA SBA is not anywhere near where it's supposed to be I won't even touch it it is such a crazy process to even be considered to get in I don't want to bother with it so perhaps there is some level of investment that is made by the entrepreneur there's some level of revenue that's been created or perhaps the the government comes in says look if you qualify for a commercial bank loan to start your business will match the loan with a line of credit so now again they can rely on the private sector to qualify that money before the government comes in and puts anything in can you imagine the level of job creation we will have the level of stimulation of economy with just a few billion dollars being given to entrepreneurs rather than being poured into already matured industries that are burning that money they're literally burning it so have I thought it all the way through now have i sat down with an economic economic economist no but at just the high level look I'm acting like I'm on a TEDx talk I'm just proposing an idea and I think it could be huge all right let's move on to challenge number two that was finding the right skills so I remember here and I'm sorry but local county government local city government local state government I'm calling you out I'm in Maryland Montgomery County Rockville I set up the Learn center here the learn center here is meant to be establishing people's skills I wanted to do a lot of local marketing I wanted to bring in people teach a marketing teach them you know digital marketing all that I went to the local representatives just to even explore the idea the notion of getting some financial support from the government to help establish to get some marketing help from the government to get the word out to partner with us to do anything because I said we will teach and support entrepreneurs will build entrepreneurs we will build digital marketers will this amazing skill set will give to people any what the government said to me hey what can you do for us i I literally was so appalled a year and a half ago when I started the center I have not talked to a single politician in the local area since then I want nothing to do with them because they were not here to support me at all doesn't surprise most people right but I genuinely had that dream I thought man when I build this Center the facility the mayors or the councilmen and the the secretaries of the state would come in and be like wow let's really help this guy he's got a vision let's do some no no no no no no nothing as a matter of fact I went and met the senator and he he asked me how I could support him helping build more companies in the in the science in in sciences that get government con I don't know what that he was talking about he basically was asking me because there's a lot of medical stuff in this area so he was like no no I only want to help in those kinds of how can you help me get those companies successful I'm looking at him I'm like many talking about it because it's a little specific sector you know well anyways couldn't get them to talk so skill set hey listen why don't we put more time and energy into technical schools and into skills based schools and stop having this stupid ass argument excuse my language about paying for everyone's college and university and why don't we give college and university a competition already did a podcast episode on freedom Friday about that that would solve problem number two problem number three immigration policies that keep talent out this blows my flippin mind we have got rallies going on left and right about letting people in on everything but merit and the minute our president talks about merit-based people are in an uproar whereas every country you'd think about you look at out there it's merit-based immigration at Canada has a grading scale they give you points you have to be above X points to get out of get in right above us all right you look at every country that is doing well they have a merit-based system you know my wife is from India right I married her she came in its but taken five and a half years to get her citizenship by the way but that's fine no problem now her friends I'm very impressed by her friends are freaking smart when I say smart I mean freaking smart wicked smart and doing very well they've all kind of left India which is sad it's a separate conversation for India but and they're in America and they're in Canada and UK and other places and tests the seat to see the level of stress they go through to be able to stay in this country it's appalling we should be rolling out the red carpet these are our high earning smart contributing individuals we should be opening the door so let right now I need more coders and developers men developers are expensive talk about a supply and demand issue they walk around they strut around like they got it all and they do they have all the cards in their deck because there are sixteen people ready to eat them up right now at amazingly high salaries which is amazing but do you know how much development experience there's around the world why as a government are we not incentivizing more people with high-level technical skills development skills to come into this market to create some competition to give companies like myself who can't compete with Google on salaries for developers a chance at getting developers and if I want to bring them in they say well get in on get in on the lottery system for h1 visa what the heck is that about we've got people pouring in that aren't bringing any skillsets yet I as a company want to hire people with talent skills who are hiring who will pay taxes we will do and I have to get on a lottery system makes no sense so number three we got to fix that we need to create classifications of high skilled highly talented educated people they should not have to go through so much so many jumps they should be able to bail out of it all right we're not gonna flood the market trust me there's a lot of industries where there's plenty of room for people to come in let's bring scientists in let's bring researchers in let's bring developers in let's bring marketers in let's bring people that are executives and other companies man let's lure them into our economy give them to our businesses make us more competitive but the talent that we're given give us access come on number four taxes I don't even talk about it it's this whole ridiculous notion of tax tax tax a wealthy tax the wealthy tax businesses tax businesses tax businesses where do you think economic growth comes from stop it so I'm not gonna talk about though because we're already moving in the right direction there and I feel that we will stay in that way regulations I don't know I'm not qualified to talk about regulations it's not impacted me that much but listen the one I'm most most passionate about is number one when I talked about insufficient access to capital come on government give us nickels on the dollar of what you're poor and out there in other industries difficulty finding my people college and universities you are on notice you need competition and I am leaning on the government to give them that competition stop giving them more money stop paying for everyone stop proposing they're gonna pay for everyone's college and university and bring them to check give them competition number three immigration policies that keep talent out it's stupid merit-based should be prepped up should be plotted up the give us entrepreneurs access to worldwide talent if you don't give us access here guess what we're gonna go there so then don't get upset when we outsource our jobs don't get upset when we move out to another country we open up offices in other countries and keep the revenue that we generate in that country and don't bring it back to America and pay taxes don't get upset if you want us to do it give us the talent here all right last piece of my rant today big companies this was really interesting big companies are a big part of what's going on and why we're having struggles and entrepreneurs look at this stat I'm gonna read this given that existing American companies opened roughly 50% existing American companies opened roughly 50% more branches in 2011 than they did in 1978 the challenge for startups is clear we're up against Vic look if you're an existing company and you're doing well you already have access to way more money than a start-up does chap that's problem number one I already talked about that problem number two is we are favoring these companies these companies are growing quicker they have more clout more lobbying so startups don't stand a chance because back in 1978 eighty percent of new establishments we're startups 80 percent so we are being out competed here's the other part big companies look at this stat this was this was huge this is a research from play bigger which advises business leaders on creating new markets found ready this found that tech companies today achieve market cap milestones such as 500 million 1 billion 5 billions Bing numbers three times faster today than they did 15 years ago it makes perfect sense all the capital all the access to money is going to these companies that are established they are growing wake quicker and guess the problem that's creating the biggest problem is creating is talent I can't compete with Facebook with Google I can't compete with them when it comes to paying for talent I'll never win I just can't as a startup so we've got to create an environment where we equal this out otherwise innovation in this country will begin to decrease the employment problem will begin to become a problem I know right now we're sitting at the lowest unemployment but that can only last so long entrepreneurs drive free markets you've got to give us the ability to last and to win so if anyone from the government's listening help us out come on you're pouring money into all these other places private private markets not going to change okay private market is a greedy market it needs to be influenced that's why the government does it's tax incentives that it does so if the government doesn't want to create tax plans all right if it doesn't want to create tax or sorry if and if it doesn't want to give us a few billion dollars to create a fund if it doesn't want to do that then listen government why don't you create tax incentives for investors who give private equity money to startups you do it for real estate already that's what got me to start investing in real estate because you give such great tax incentives so why don't you do the same thing for free market investors who invest in startups seed and series a you will see money poor in jobs explode innovation explode kacct capital access bloom talent being bloomed and then the second thing layer it on with merit-based immigration that allows floods of people in the right industries with the right credentials to get in ah man utopia for entrepreneurship it's not that hard to do pretty easy solution what do you think I don't know it's what I think but what do you think so hey listen if you're listening to us on iTunes please go to onic podcast com click over to the iTunes and leave us a great review and if you're watching this on youtube you know what to do click Subscribe click the thumbs up icon click the Bell icon and leave me a comment I can't wait to have a conversation with you about this let's save entrepreneurship ladies and gentlemen let's save entrepreneurship not in just in America but all over the world because in the end entrepreneurs are those who will save the world without entrepreneurs we're doomed so make it happen in make sure you go to learn comm Lu RN com sign up for your free lifetime membership get involved in the community as we put 10 million pee into it you can either stand by and watch us move right by you or you can be a part of the movement this is onyx I'm reminding you when life pushes you stand straight smile and push it the heck back come on you're fighting entrepreneurs go out there and fight until the next time we talk thanks for listening to the fighting entrepreneur with your host onyx Engel [Music]