In my practice, I have coached hundreds of college students to become career-ready. Many of whom are aspiring entrepreneurs and have a lifetime goal of owning their own business.
There plan is to start with a big company, get some experience, start something of their own and become an entrepreneur. On the face of it, the plan seems reasonable and safe.
But if this is the goal, why wait?
To be honest, this is a personal question as I have children myself, ages 10 and 14. College is just around the corner, I am asking myself is college worth it?
Should I have them forgo college and start their own business instead?
Costs and Earnings of Going to College
According to the National Center for Educational Statistics (NCES), the average earnings for a 24-35-year-old with a BA is 51k and with a Master’s is 65k.
In addition, the cost of a 4-year degree is 83k-201k, the cost of earning a Master’s degree, 30k-12k (FinAid.org), or PHD $36k (Study.com).
How does this compare to the costs and benefits of being an entrepreneur?
Costs and Earnings of Aspiring Entrepreneurs
A study from the Kauffman Foundations found that the average start-up cost for a business is 30k.
A study by Fundera.com found that the average small business owner earned 55k.
So let’s put this in perspective. On average it costs 30k to start a business that earns on average 55k compared to 83k-120k to earn a college degree to earn 51k.Subscribe to my Email Newsletter.
College is Not Necessary for Aspiring Entrepreneurs
I’m not saying that everyone should forgo college. What I am saying is that if you or someone you know desires to own their own business there is a compelling argument to start right away.
But isn’t the failure rate for starting a business high? Wouldn’t it be safer to simply go to school?
It’s commonly accepted that 1/2 of all start-up businesses fail. So there is risk in starting a business.
To counter this risk aspiring entrepreneurs to should find able mentors and coaches to guide them to success. Aspiring entrepreneurs should include coaching/mentors as a start-up cost.
However, going to college isn’t without risk.
Is it reasonable to think an 18-year-old should forgo college and start a business?
With the right amount of mentoring I could envision a mature 18-year-old, forgoing college and accepting an apprenticeship for a number of years with the intention of eventually starting their own business or buying it from the mentor.
This article focuses exclusively on cost and earning potentials and does not discuss many of the other factors of success articulated in my blog post titled What is Success? There are many other benefits to owning your own business besides income.
However, in order to compare similar data point, this articles looks at the costs and earnings for college graduates vs. entrepreneurs.
The facts speak for themselves. For aspiring entrepreneurs, there is a compelling argument to forgo college and start a business.
Parents should consider if their education investment would be better spent in helping their children learn to become business owners.
In fact, I smell a business opportunity here.
What if there was an education program based on the principles of mentoring that parents that could purchase instead of college to help their children start and operate their own business?