New Business Owners Hurt by 'Unpredictable Conditions' in 2012


The Ewing Marion Kauffman Foundation and LegalZoom on Wednesday released their 2012 Startup Environment Index, detailing the experiences of 1,431 entrepreneurs who opened businesses using LegalZoom in 2012.

Less than half (40%) of the respondents said they didn’t run up against any of the general barriers to business listed on the survey. However, of those who did experience a barrier, 55% cited the “unpredictability of business conditions” as a roadblock, while the remaining 45% cited a “lack of access to credit.” LegalZoom CEO John Suh says the fiscal cliff discussions, and the “back and forth of what 2013 is going to look like hung like a cloud over the business owners taking the survey.” The survey also asked which policy issues present the most challenges for new business owners. Most commonly cited were high taxes, complexity of taxes and difficulties associated with licensing fees and regulations. “Certain states are taking more helpful stances with regard to red tape than others,” says Suh, noting that the first few months are critical for new businesses, and difficulties securing the necessary licenses stretch make it difficult for many small businesses – like restaurants – to open quickly and start making money.

For more details, the full survey can be viewed here.