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Is a college degree necessary to start a business? Whether entrepreneurs need college degrees to succeed, or whether the time spent earning that diploma is better spent actually launching a business, has been an ongoing debate as long as I can remember. But with college costs and student debt skyrocketing, there’s a new consideration in the debate: Is student debt preventing would-be entrepreneurs from starting businesses?

Deep in debt

There’s more than a grain of truth to the idea. A person who graduates with $30,000 in student loans is 11% less likely to start a business than a person who graduates with no student debt, reports The Hidden Cost of Financing Education: Can Student Debt Hinder Entrepreneurship?, a study by Karthik Krishnan, an associate professor of finance at Northeastern University.

And $30,000 is a fairly average student debt load. As of 2018, 42 million student loan borrowers have student loan debt of $100,000 or less. Most of these (12.4 million) have debt between $10,000 and $25,000. But over 2 million student loan borrowers have student loan debt of over $100,000.

The 20s and 30s have long been considered the best time of life to start a business. In your 20s or early 30s, you probably don’t have a mortgage to pay, children to raise, or a spouse to fit into the equation. But today, you are likely to have looming student loan payments—unlike Generation Xers or baby boomers, who generally paid off any student debt they had in a few years.

With prospects for employment also dim, today’s young adults are between a rock and a hard place. Ironically, with more college-level entrepreneurship courses and entrepreneurship degrees than ever before, getting a college degree could seem even more helpful for starting a business.

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Startup or school?

When deciding whether you really need a college degree to be your own boss, take these factors into account:

  • What kind of business do you have in mind? If you’ve got your heart set on a professional services business, you probably do need that degree. On the other hand, if you want to start a construction company, an apprenticeship program or work experience might teach you all you need to know.
  • How else can you get the business education you need? Business skills, like how to manage bookkeeping or the basics of marketing, will help you grow—but you can get those elsewhere than at a four-year college. Check out local community college or adult education classes, or courses and advice offered by SCORE and SBDCs. (Disclosure: Both organizations are clients of my business.)
  • What other advantages can you get from going to college? Yes, college connections can help your startup succeed (there’s a reason so many startup wizards went to Harvard).  Taking out student loans might be worth the cost if they’ll pay off in valuable contacts.
  • How much money do you have and what’s the best use for it? If you have capital for either college or a startup, add up the numbers. How much will launching a business cost? How much will college cost? And how will your parents react if you decide to start a business and skip college?
  • Is now the best time? Some businesses are best launched by a younger person; for others, you need a bit more life experience. Perhaps this is one reason entrepreneurs in their 20s are less likely than older business owners to build high-growth companies, according to a paper Age and High-Growth Entrepreneurship. Would waiting to start your business benefit it in the long run?

Whether to go to college or straight into business startup is a choice only you can make. Just be sure that you consider your options very carefully before you take the leap.

RELATED: Young Entrepreneurs: How to Prepare for Small Business Ownership While You’re Still in College

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According to a recent report on handmade commerce, Etsy sellers are contributing $4.7 billion to the American economy right now.

The report, on the surface, shows two positive signs. First, consumer spending is presumably strong. Second, there’s a thirst for quality handmade goods, which are most often made by small business entrepreneurs. This is only one of several stories important to small business retailers and others this week.

To see what other stories are making headlines with small business owners and other entrepreneurs, check out our full news roundup below.

Retail Trends

8 Big Predictions for the 2018 Holiday SHIPPING Season

Americans are set to spend big this holiday season. In fact, numbers from Adobe Analytics report the online spend alone will reach $124.1 billion to overshadow brick and mortar sales. What’s more, Deloitte reports that people will spend $525 on gifts representing a bump of 20% from $430 in 2017. 2018 Holiday Shipping Season Small Business Trends talked with Georgianna W.


Zoho Adds AI and Analytics for Small Business with CRM Plus

Zoho has recently released the latest addition to its customer experience CRM platform offering the one-two punch of advanced analytics and artificial intelligence. Zoho CRM Plus lets small businesses without big IT budgets compete with the bigger players by letting different departments like customer support, marketing, sales and operations work together.


31% of Businesses List Healthcare as Top Issue for New Congress

A new poll sees healthcare as the top issue for small businesses as the new Congress takes shape after the midterm elections. The numbers come from a recent poll conducted by The Small Business Roundtable, a small business and entrepreneur organization dedicated to the advancement of this critical aspect of the American economy.


Hiring 3.8% Higher than October 2017 but Leveling, LinkedIn Reports

The monthly LinkedIn Workforce Report for October 2018 revealed gross hiring in the US was up 3.8%, higher than for the same period the previous year. With seasonally adjusted national hiring down only 0.3% from September to October 2018, the job market is still very strong.


Switching  to an Open Office May Make 1 in 8 of your Employees Consider Quitting, Survey Says

Believe it or not, the open office concept was being used before the cubicle in the early 20th century. What we’ve learned since that time is there is no one-size-fits-all solution when it comes to office space, which is what a survey commissioned by ROOM reveals.

Social Media

Pew Research Provides Important Data for Small Businesses about Marketing on YouTube

Data from a new Pew Research Center survey reveals YouTube has become a valuable resource for Americans. The research contains some valuable insights for small businesses now using the platform as a marketing channel. Users are turning to YouTube for how to videos, product information, children’s content and even news.

New Looping Video App Planned from the Creator of Vine, Could Your Business Benefit?

For the millions of fans who regularly watched and loved its quirky videos, the sudden shut down of the Vine app in October 2016 came as a bitter blow. If you happen to be one of those fans or one of the creators who made those videos, there is good news because the co-founder of Vine, Dom Hofmann, is bringing the app back with a new name: byte.


1  in 7 Americans Think They Are Sitting on a Game Changing Business Idea, Survey Says

How confident are American entrepreneurs about their business idea? A Northwestern Mutual survey carried out by OnePoll reveals one in seven think their idea is so strong it could change the world and have a dramatic impact in the chosen industry. This level of confidence is commendable and even necessary in order to persevere and make your dreams come true.

Technology Trends

PayPal Acquires Hyperwallet with Focus on Ecommerce Businesses

PayPal (NASDAQ: PYPL) recently completed the acquisition of Vancouver-based global payout platform Hyperwallet Systems for approximately $400 million USD.

Companies Adopt Ride Sharing – But Not Room Sharing – in Business Travel Policies

Services provided by the sharing economy have increased adoption rates for shared transportation during business trips. But according to a new survey from Chrome River, the adoption rate for shared accommodation hasn’t reached the same levels. Instead of using Airbnb, HomeAway, or VRBO, business travelers are still opting to stay in hotels for their accommodations.

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This article, “Top Stories: Etsy Businesses Contribute $4.7B, 31% of Entrepreneurs Concerned about Healthcare” was first published on Small Business Trends