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Down times spark start-ups

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The latest data from the Bureau of Labor Statistics show that the number of self-employed Americans has fallen by an average of 74,000 per month since August. In February, there were 8.9 million self-employed Americans, down from a peak of 9.9 million in December 2006.

For Bender, preparing for his entrepreneurial venture included creating a website and enrolling in business classes. Even so, he has faced challenges.

"I'm primarily an action photographer, shooting high school football games and motocross events, and the equipment needed for this type of photography is costly," he says. "I ended up using much more of my severance money on equipment than I originally planned. That has forced me to look for contract work back in the high-tech industry. Becoming profitable has been a slow process, which has caused me to reevaluate my business plan and pursue some more profitable options, such as wedding and portrait photography."

When those who have been laid off say they want to start a business, Jim Malski, president of Action Coach, business consultants in Westport, Conn., asks an all-important question: "Why are you doing that?" He adds, "Running your own business is hard. Deciding to go into business as a last resort is a bad reason. A good reason is, 'This is something I've wanted to do for a long time.' "

Mr. Malski notes that 80 percent of businesses fail before Year 5, and 96 percent fail before Year 10.

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