The best sectors for would-be founders
First published in the Financial Times on 21st May 2013.
It pays to join the right industry even if you don’t become self-employed right away
Certain jobs are suited to entrepreneurship, while others are definitely not. If you have ambitions to become an entrepreneur, it pays to join the right industry even if you don’t become self-employed right away.
So I thought I would list my eight favourite sectors for would-be entrepreneurs.
- Farming: Almost all farmers are self-employed. Many run modest smallholdings, but some build large concerns. An example is William Chase, the potato farmer who founded Tyrrells crisps. Farming is dominated by family-owned operations, and generally requires significant capital while offering volatile returns. But rising commodity prices and the growth of external investment in farmland means there are now better opportunities for newcomers. Many farmers are unwilling to evolve with new crops or growing methods – which means entrepreneurs who embrace innovation can do well.
- Property agents and realtors: They mostly work for themselves and many go into the property business as principals. You can combine being a developer and landlord while still acting as a broker. While institutions own many buildings, they lack the instinct and insight entrepreneurs bring to the property game. A high proportion of the richest property magnates started as humble estate agents or surveyors. Selling ability is critical to the role, and is a prerequisite for any entrepreneur.
- Academics in scientific specialities: They are in a great position to found businesses – especially in fields such as information technology and biotech. Jim Clark, of Silicon Graphics and Netscape, was a professor; Dr Herbert Boyer, co-founder of Genentech, was a biochemist. Of course some university tutors struggle with the profit motive and prefer the cosy world of the public sector. But an increasing number combine teaching, researching – and building companies to exploit their ingenuity.
- Pharmacist: A profession that neatly marries commerce and invention. Many pharmacists become successful retailers or drugmakers. It is a big sector and constantly changing. From Jesse Boot, who built the eponymous high street retail chain, to John Pemberton and Caleb Bradham, inventors of Coca-Cola and Pepsi respectively, many of the world’s largest companies have been started by druggists.
- Geologists: Mining, oil and gas have been boom industries in recent decades, and almost all natural resources businesses were launched by geologists, who provide the technical expertise and credibility. While large companies dominate the extractive industries, there are forever new ventures being created that make valuable discoveries.
- Hospitality: The restaurant, hotel, travel and leisure industries are fragmented and offer great rewards for resourceful management. The craft requires a service mentality, strong people skills and hard work, but not formal qualifications. Many publicans, hoteliers and restaurateurs I know achieved success after leaving school at 16.
- Accountancy: They can be cautious but they also understand the figures better than anyone and see more possibilities than most. Every business requires a financial expert, so they are typically in a good position to partner with other entrepreneurs who might bring an invention or product to the deal. I know plenty of accountants who run a practice and back entrepreneurs as a side business to their auditing and advisory work.
- Information technology: IT entrepreneurs are the best-known category of modern millionaire. From Bill Gates at Microsoft to Mark Zuckerberg at Facebook and David Karp at Tumblr, many of the world’s largest and most-recent fortunes have been built in the software and digital industries. The scalable nature and low marginal costs in these sectors make them highly attractive – although they are extremely competitive, with low barriers to entry.
Of course entrepreneurs can emerge from any walk of life: but my hunch is that these professions offer the best opportunities for enterprise.