Homepreneurs, the myths and facts

Think home-based businesses are hobbyists? Forget it! The “homepreneurs” are a serious, and seriously skilled group, determined to succeed. By AMANDA GOME.

By Amanda Gome

When I told people I had left a big corporate to start SmartCompany I was asked many times whether I would be “working from home”.

The patronising tone was always a shock. For the past 10 years I had been researching and writing about the quiet revolution occurring in the workplace and had observed highly innovative companies starting or working from home.

The revolution was kick-started by the growth in the service industry in the 1980s and gathered pace through the 1990s as big corporates downsized, forcing people out clutching retrenchment packages. Aided by technology, they make up many of the 110,000 people who start up businesses every year.

Yet the home-based business sector of the economy continues to be misunderstood. People think of home-based business people as cottage industries or trades people.

Worse, they consider them drop outs, unsuccessful, “mompreneurs” or women with a hobby earning enough for a trip to Noosa. Sure, some are home-based business hobbyists. Many of these will never make enough money to file a tax return.

But many of the almost one million home-based businesses are successful.

By far the most misunderstood group at home are the “homepreneurs”. Homepreneurs employ at least one other staff member and usually aim to grow. They also make up a sizeable part of the workforce: of the 1.2 million small businesses, about 30% are homepreneurs.

Homepreneurs fall into two groups. First are the business builders who are at home as a temporary measure before being forced, by staff numbers, to move into larger offices.

Business builders can end up running global businesses. RMIT University’s Kosmas Smyrnios, who researches high-growth companies, says more than half start from home, usually because of the low cost.

The second group are business lifestylers – and are committed to staying at home unless forced out. They still work extremely hard, employ staff and want to be successful but their lifestyle is very important and they build their business around it.

Yet myths abound about this sector. Here are the top nine facts about successful homepreneurs.

1. Most homepreneurs are ambitious males who want to run successful businesses:

Many people believe home based businesses are run by women running cottage industries or e-Bay businesses. But ABS figures show that only 17% of home-based businesses are run predominantly by women. There has been huge growth in the home-based business operators (57%) aged 30–50, particularly males. Ross Cameron, who has researched home-based businesses, says this is the age when men get retrenched and set up a home business. Many are in classic white-collar areas and include management consultants, copywriters, finance brokers, lawyers, accountants, IT nerds and management consultants.

2. Most homepreneurs work very long hours and run established businesses.

Many people assume home businesses are hobbies. Some are. But ABS data shows the majority of people are home work more than a 35-hour week and one-third employ staff. The majority of home businesses are also more than five years old. While some – the business builders – move out after a few years, most do not want to move from the home base.

3. Homepreneurs are technologically very savvy.

Many people still carry the picture of the cottage industry or tradesman working from home. But ABS data shoes us home-based businesses are more likely to be computerised than non-home-based businesses. In fact, this is the reason they can operate from home.

4. Homepreneurs are more likely to be extroverted.

Doesn’t make sense? Think about it. If you don’t have the skills and personality to network as a homepreneur, you will fail. Executives in big corporates who have been put out to pasture for no longer fitting in with the corporate culture often make lousy homepreneurs because they take their problems with people in the workplace with them. Homepreneurs also need to make new contacts.

5. Homepreneurs are comfortable parting with money.

Homepreneurs watch every cent; that’s partly why they are home – because it is cheap. But they must also be comfortable paying for the best technology and the “appearance” of being successful to overcome the “home” image. There are also a huge amount of unexpected costs that arise, which are a surprise to the corporate refugee who has never paid for a color printing cartridge in his life.

6. Homepreneurs are chasing opportunities.

The assumption that people start home-based businesses out of necessity because they can’t get a job elsewhere is not true of homepreneurs. People in this group are opportunity entrepreneurs. While they are seeking greater personal freedom, they also are pursuing an idea and the chance to make something of their lives, says Jane Shelton, managing director of policy group Marshall Place associates.

7. Homepreneurs are an extremely attractive target for marketers and advertisers.

Many advertisers ignore the home-based business market because it is so diverse and difficult to reach. But Shelton’s research into the home worker (which also includes people working from home that are employed by large corporations) shows they are a very attractive target. She estimates there are 2.8 million home workers and 45% belong to a higher socio-economic segment. They are twice as likely to be managers and administrators with professional qualifications and six out of 10 are big spenders, with almost half owning and trading shares. They also seek a constant supply of information on business opportunities and investment decisions.

8. Homepreneurs are big risk takers.

Home is often seen as a soft option. It is anything but. A whole new set of challenges present themselves. Homepreneurs must overcome solitude, develop sales, marketing and networking skills, learn to multiskill and juggle plus overcome the shock of having to do everything such as buying the stationery until they hire that first employee.

9. Homepreneurs dress for success.

Forget the image of the SOHO office with the business owner in tracky daks. Homepreneurs are extremely disciplined and become expert at shutting the front door in well-meaning friends’ faces. They start the day in cafes with their laptops or newspapers, dressed for work.


Hints from the home front

Compiled by Libby-Jane Charleston

The Hip Infant
Mel Barrasi
Service: Online shop for kids
Staff: 3
Success statistic: 2000 customers/orders a year, unique visitors to website daily average 650
Success tip: Be passionate, stay focused, work every spare moment and keep your business unique. And stop friends from inviting themselves over. “The worst thing about all these distractions is it means you end up working into the wee hours of the morning trying to finish all the work you couldn’t finish during the day.”

Bespoke Image
Imogen Lamport
Service: Image consultant
Staff: 2
Success tip: Ask for help from others. It’s amazing how generous people can be with their time and expertise. Remember to return the favour and give help when asked. “You need to set up systems to help you work. The isolation is also challenging. You don’t have others to talk over your ideas with at the coffee machine and in the corridor.”
Lamport also says that it is a good idea to join a network with others in your industry. “Even if you’ve just had a bad day or difficult client, it’s great to know there’s someone you can contact who will understand what you’re talking about.”

Jennie Moon and Melissa Robbins
Service: Children’s clothing
Staff: 5
Achievement: Supplies 130 exclusive stores in Australia, NZ, US and Japan.
Success tip: Get dressed for work, do not stay in your tracksuit pants. A good way to focus on your home as your office is to leave the house first thing in the morning, go out for coffee or a newspaper, then return home to work.

Chocolate Attraction
Entrepreneur: Peter Axton
Service: Chocolate fountains
Staff: 2
Achievement: Turnover $150,000
Success tip: Use all the free information and advice that is available to you. This includes books, magazines and websites. Home business owners also face quirky problems that other businesses would rarely have to worry about. One day Peter Axton was baffled why his internet access was so slow. “It was because one of my family members was on the computer (our computers are networked). I also spend a lot of time trying to explain to customers that we are a home-based business and not a shop; they can’t just drop in to see a chocolate fountain operating!”

Monique Alamadine
Service: Online retailer
Staff: 1
Success statistic: 4000 visitors to site per month
Success tip: It’s also important to stay in contact with the outside world. It’s easy to get caught up in your work and neglect areas like networking and dealing with people who don’t work from home so you can understand market trends and get an influx of fresh ideas and energy.

Organise your Life
Claire McFee
Product: Household filing system
Staff: 1
Success statistic: Over 5000 customers.
Success tip: Work on your own personal development as well as your professional development, as this will result in the increased success of your business at the same time. Work smart, not hard and leverage your time. If you stop enjoying what you are doing, find something else to spend you life doing, because life’s too short.

Wedding Boot Camp
Entrepreneur: Kylie Carlson
Service: Mobile wedding planners
Staff: 1
Success statistic: 5–10 new customers every day
Success tip: Pretend there is more than one of you working for your company. There has been many a time when I have answered the phone as ‘Brenda from the accounts department.’ It never does any harm to give the illusion of being bigger than what you actually are. It also helps when people are chasing overdue accounts!

Cupcakes Jewellery
Michelle Dube
Service: Online retailer for kids’ jewellery
Staff: 1
Success statistic: Over 1000 regular customers. More than 4000 visitors to site each month.
Success tip: Put business before housework. If you get bogged down with doing housework, you’ll never do your business. Housework is never-ending, so try to ignore everything in the house until you’ve got a big block of work out of the way.


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