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Contact: Robert Bernstein
Public Information Office
More than half (51.6 percent) of all businesses that responded to the 2007 Survey of Business Owners (SBO) were operated primarily from someone's home in 2007, according to new data from the U.S. Census Bureau released today. Only 6.9 percent of these home-based businesses had $250,000 or more in receipts, while 57.1 percent of home-based businesses brought in less than $25,000. About 23.8 percent of employer respondent businesses and 62.9 percent of nonemployer respondent businesses were home-based.
“Most businesses are started by people who dig into their own pockets for at least some of their start-up capital,” said Census Bureau Deputy Director Thomas Mesenbourg. “This is true for both firms with employees and those without them. Furthermore, more than one in five (20.8 percent) of respondent businesses used no start-up capital at all.”
The Census Bureau is releasing two data sets from the 2007 Survey of Business Owners: Characteristics of Businesses: 2007 and Characteristics of Business Owners: 2007. The data sets include national-level statistics on owner's age, education level, veteran status and primary function in the business; family-owned and home-based business status; types of customers and workers; and sources of financing for start-up, expansion or capital improvements. All findings are for respondent firms only.
“Roughly three in 10 (30.6 percent) of the respondent firms that required start-up capital launched their business with less than $5,000. Of the firms that needed start-up capital, 17.5 percent of employer firms needed less than $5,000; for nonemployer firms, the figure was 35.8 percent. At the other end of the spectrum, 1.5 percent of the firms needing start-up capital required $1 million or more for this purpose.
Other highlights from the reports include:
The data were collected from more than 2.3 million firms that were asked to report information about the characteristics of up to four individuals with the largest share of ownership (respondent firms); additional owners were not surveyed regarding characteristics. Detail may not add to total because of rounding or because a Hispanic firm may be of any race. Moreover, owners had the option of selecting more than one race and are included in all races they selected.
The Survey of Business Owners is conducted every five years as part of the economic census. The 2007 survey collected data from a sample of more than 2.3 million businesses. Data collected in a sample survey are subject to sampling variability, as well as nonsampling errors. Sources of nonsampling errors include errors of response, nonreporting and coverage. More details concerning the SBO survey design, methodology and data limitations can be found at http://www.census.gov/econ/sbo/methodology.html.