There generally are two ways to becoming a small business owner:
You could buy an existing company, with its established customer base, stable of trained employees and proven cash flow.
Or you could start a company from scratch and bootstrap it - hopefully to success.
Starting from scratch may be best for the entrepreneur with a groundbreaking idea. On the other hand, those who aspire to make their own hours or seek more immediate cash flow may be better off taking over an established business, said Patrick Snyder, executive director of the United States Association for Small Business and Entrepreneurship, which fosters, teaches and researches entrepreneurship.
"Buying a successful, existing business with proven cash flow and revenue history is almost always going to have a higher chance of success than starting from scratch," said Bob House, general manager of BizBuySell.com and BizQuest.com, which together feature 76,000 business listings for sale.
"If you do have something that's totally novel, the question to ask yourself is what pieces are necessary to build that? You might find a business that has some of those qualities and you could pivot them to [meet your goals], but there are plenty of examples where if it's a new model and no one's created it before, then you may have to go the startup route."
Buying an existing business, or an existing business' assets, can also work when that business has something you need to run more smoothly, said Alan Pinck of A. Pinck & Associates and volunteer for SCORE, the Small Business Administration's free mentorship program.
For example, one of Pinck's clients bought a falafel restaurant because it had a valuable lease in the right location, even though he closed it and reopened as a lobster roll eatery.
Pinck himself purchased a client list from a competitor that was closing so that he could get a head start on his own tax consultancy,
Meanwhile, interest in owning businesses of all types is up.
Small business activity in the U.S. rose in all states except Tennessee in 2015, according to entrepreneurship research by The Kauffman Foundation. It also found that entrepreneurial activity increased by the largest year-over-year amount in two decades in 2015.
Jake Emen was working part-time as a Washington, D.C.-based online marketing professional when he began editing for the website ProBoxing-Fans.com. After spending a year building its traffic and profitability, with an eye on becoming self-employed, he opted to buy and build on ProBoxing-Fans.com's existing infrastructure.
"While I knew I could start my own boxing site from scratch I knew that I would just be competing with what I had just spent time building," he said, noting that he was purchasing built-in advertising revenue, sponsorships and web traffic for about 10 times its proven monthly income.