The search for profitable businesses to start in the USA is an ongoing mission that knows no age or limitations. Unlike other markets, the percentage of entrepreneurs in the United States is very high. According to the latest reports from the Global Entrepreneurship Monitor, 20% of the working-age population in the United States is involved in entrepreneurial activities.

Although the entrepreneur term is often distorted, often associating it with technology, innovation, or new product development, the truth is that entrepreneurs are all of us who, in one way or another, design and add value to meet specific needs in the market. From a basic service like a dentist to the most sophisticated ideas we can imagine.

When choosing businesses to start in the United States, it is essential to conduct an analysis of our conditions and capabilities as entrepreneurs, thus avoiding crossing what I call: excessive risk. No entrepreneurial activity in the United States is free of risks, and profitable businesses in the United States, as well as anywhere else in the world, involve time, resources, and a tremendous amount of effort.

Many entrepreneurs ask us: what to start in the United States? Of course, we don't have a clear answer or a crystal ball, but we do have an initial plan to assess the risks associated with business models to start in the United States.

Types of Businesses to Start in the United States.

Although we are familiar with the types of business models, and even teach about them at universities, in a first simple analysis, we must understand that there are three common types of business models in the United States and we refer to them as follows:

Self-employment businesses in the USA:

It is by no means far-fetched, if you have a vocation and/or special skill, to try to make a living from it by starting an entrepreneurial project in the USA. We refer to self-employment businesses in the United States as those business models that are based on the fundamental skills and abilities of the entrepreneur. For example, if you have special skills with musical instruments, it would make sense to teach others and set up a music academy.

Not to get into the restaurant business, which is often the place of failure for many entrepreneurs trying to find potential businesses in the United States. As you read. The restaurant and bar offerings in Miami, for example, are vast, making differentiation opportunities quite scarce. Location, decoration, quality of dishes, and service are not enough to turn a restaurant into a profitable business; it is key that it is supported by a strong sales and differentiation strategy.

We could treat restaurants and food businesses in general, the same way as a self-employment business, in case you have special skills as a chef and it's your true passion, or as a type of entrepreneurship that we call a business with a cap. In a minute, you will understand why.

The self-employment businesses to start in the United States are very common in the entrepreneurial fabric of the United States, the most obvious reasons are:

• The entrepreneur interacts, and it depends on them, the value proposition and quality of the service. 
• The entrepreneur has the ability to pamper their customers and control all the details of the product or service. 
• The entrepreneur knows their limitations and sets plans to overcome them. 
• The entrepreneur controls financial risks and typically grows the business organically (financing through revenue provided by customers).
• The investment required to start a business in the United States is not too high, as the key service and knowledge are provided by the entrepreneur themselves.
• The prices of spaces and conditions for offering the service can improve over time, which further reduces the impact of the initial investment to start a business in the USA.

On the other hand, the most negative aspects of self-employment ventures in the United States are:

• Excessive dependence on the entrepreneur, which reduces quality of life and free time. 
• The growth possibilities of these business models are often very limited, precisely due to the level of dependence mentioned above. 
• The risk associated with the business is usually high, as it is very difficult to achieve economies of scale, so better prices will almost always be found on large platforms in the industry. 

 

Businesses with a ceiling:

The type of businesses to start in the USA, which we call "Capped Business Models", is characterized by entrepreneurs whose primary skills are not connected to the value proposition. In this sense, the entrepreneur is responsible for controlling the processes, but the customer experience does not solely depend on the entrepreneur's production work. There are several business models to start in the United States that can be a capped business, according to our classification of types of businesses, and at the same time be a self-employment business to start in the United States.

Don’t worry, I’ll clarify it for you. 

Siguiendo el mismo ejemplo de los restaurantes, como ejemplo de negocio rentable en Estados Unidos, según nuestra clasificación de tipos de negocio para emprender, el negocio de autoempleo en USA se debe al nivel de dependencia y escasas posibilidades de crecimiento del negocio por la gran dependencia de la propuesta de valor sobre el chef. O sea, si los clientes visitan este emprendimiento en USA porque les gusta el trato que les brinda el chef, que a la vez cuida a los clientes y prepara sus platos favoritos, difícilmente se pueda replicar la experiencia que tanto valoran los clientes. Por tanto, el chef podrá incrementar los precios, ser cada vez más selectivo con sus clientes, vivirá cada vez mejor, pero, difícilmente, deje de ser un negocio de autoempleo.

Unlike this personalization and dependence on the entrepreneur, capped businesses are those where such a level of dependence does not exist. However, due to the lack of innovation in the product, service, or the business model itself, the prices have a cap.business model, the prices have a cap.

When choosing a business model to start in the United States, it is essential to study the level of democratization. It is common sense and a basic principle of supply and demand. Excess supply, without differentiation, democratizes prices and projects a downward average line.

It is true that capped businesses, even when based on product sales, also have some advantages. Let's analyze the main advantages and disadvantages of what are known as capped businesses:

• The entrepreneur has a greater degree of independence and freedom compared to self-employment businesses.
• The entrepreneur can perfect their control techniques, leadership, and grow in structure over time. 
• The focus on sales by entrepreneurs allows, in some way, to achieve economies of scale. For example, optimizing prices through bulk purchases. 
• The resources needed to start these businesses are usually not excessive. 
• The businesses with limits are common business models for family businesses in the United States, which is a highly valued point by many entrepreneurs.
• They tend to be well-known business models, so the risk of these models is usually well controlled due to the accumulated and popularized knowledge.

The businesses we call "capped" also have some disadvantages or negative points that we must keep in mind; 

Growth opportunities are limited. They tend to be costly structures, making it very complicated and expensive to replicate these business models.

The startup effort is considerable. It requires much more financial resources than the self-employment venture in the USA. Even so, we will see that it is still much less than creating a novel product to sell.

The limitation of the margin is often one of the most relevant factors among the negative points of this type of venture. Precisely, the accumulated knowledge about the behavior of the business model, the democratization of similar products and services in the market, and the limited ability to differentiate, make prices and structures highly standardized. Of course, this relationship directly affects the possibility of increasing the economic margin of this type of venture.

Innovative Businesses: Innovative businesses, as the name suggests, require significant changes to the product, service, or business model itself. When we talk about profitable and innovative business models in the United States, we don't have to imagine products with artificial intelligence or radically innovative products that change the rules of the game in an industry. Nothing could be further from the truth.

Innovation itself has a very positive aspect when it comes to choosing innovative business models for the United States, but it also has a very negative aspect. The key is to find the balance between both, and we can help you.

The positive aspect of innovation for entrepreneurship in the United States is that if it is an innovation accepted by the public, you will have a profitable business model with significant potential for success and economic margins. On the other hand, the negative aspect is that choosing innovative entrepreneurship options for the United States also comes with a great number of challenges and uncertainties, which could, of course, lead to failure in the entrepreneurial project.

Therefore, the fundamental balance of innovative business models in the United States lies in achieving coherence between profitability expectations, the level of innovation, and the economic risk involved.

At Let´s Prototype, we typically work with inventors and entrepreneurs who understand this balance and choose profitable business models but highly innovative ones to start a business in the United States. Due to the nature of our company, these are inventors who want to develop new products to sell, products that don’t exist or products that improve upon existing ones.

Creating a new product to sell, innovative products and patentable products, has a significant advantage: these are products that do not have a fixed price in the market. Therefore, the pricing strategy is not based on manufacturing costs, but on discovering how much a customer is willing to pay for the proposed solution.

One of the most important tools when choosing an innovative business model to start in the United States is focusing the startup management on easing the burden of uncertainty. In the case of innovative products to sell in the United States, this uncertainty can be alleviated with what we call a technical study.

The technical study of inventions is a service that focuses on clearing up doubts about the functionality and the technical feasibility of an innovative product. By activating all the technical disciplines or departments involved in the product development, the various solutions that must be considered for the product to function are determined. Subsequently, feasibility tests are conducted in the prototype laboratory, and both theoretically and practically, the feasibility of the product is demonstrated. Once this important hypothesis is cleared, commercial tests are carried out to prove that, in addition to being an innovative product, a business model for innovation in the United States can

The main advantages of innovative businesses to start in the United States are based on their potential profitability and growth. These are opportunities that could lead to expensive patents and even to the sale of businesses or the sale of the innovation itself to leading companies in the market, willing and interested in exploiting these business opportunities.

Below, and just as a summary, I share a very graphical comparison table, where I aim to facilitate the identification of the types of profitable businesses to start in the USA

A good summary of this post about profitable businesses to start in the USA, could be the relationship: risk and required profitability. The choice of a business model should be conditioned by these factors. If you want to discuss a new product and need our help in its creation process, we would be happy to provide support.