Small business is a diverse category. It encompasses companies in different industries that vary greatly in size, capacity for growth and management style. However, there are some characteristics that many small businesses share.
A common characteristic of small business is the entrepreneurial mindset. Entrepreneurs are often willing to take risks and work tirelessly to bring their vision to life. This determination can be a big advantage in the face of setbacks or economic uncertainty. However, it’s important for entrepreneurs to recognize their own limitations and understand the risk of burnout. Burnout is a state of exhaustion, cynicism and inefficacy that can lead to diminished productivity and low morale.
Defining small business varies by industry, but generally speaking, small businesses are independently owned for-profit corporations, partnerships or sole proprietorships that are smaller than large businesses in terms of revenue and employee numbers. Small businesses may be public or private and can be a single location or have multiple locations. When it comes to government contracts, the U.S. Small Business Administration (SBA) sets size standards that determine which companies are eligible for financial assistance or contracting opportunities with the federal government.
If you are interested in starting a small business, the first step is understanding your legal structure and regulatory landscape. Visit the IRS Small Business and Self-Employed Tax Center portal to find answers to questions about taxes, forms and publications, a video library and other online resources. Additionally, you can use the Lender Match tool to search for lenders who offer SBA-guaranteed loans.
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