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Navigating Mental Health Challenges As A Digital Entrepreneur: The Role Of Financial Inclusion, Technology And Mentorship

Zahir Khoja, CEO, Wave.

What is a small business today? In the past, it may have meant your local brick-and-mortar store. Today, with the proliferation of online businesses, we’re seeing a new segment of business owners emerge, often referred to as the “solopreneurs,” freelancers, micro-business owners or creators. Today, this segment, which encompasses businesses with fewer than nine employees, comprises a staggering 96% of U.S. businesses. This includes many individuals in the fast growing creator economy, which currently engages 1 in 4 people globally.

Despite the rapid growth of this micro-business economy, the daily struggles of digital entrepreneurs often go unnoticed. A recent survey conducted by my company, which surveyed 1,000 digital entrepreneurs, shed some light on the struggles faced by these individuals. The survey found that;

? 70% of entrepreneurs grapple with the dual burden of financial and mental stresses.

? For 75% of entrepreneurs, business finances emerge as the primary source of stress.

? Working parents, especially mothers, experience elevated stress levels, with only 15% reporting excellent mental health.

? A striking 87% of respondents tie their personal self-worth to the success of their business, highlighting the strong link between personal identity and work.

These statistics underscore the need for enhanced support for digital entrepreneurs—support that is tailored to the unique needs of this important segment of the economy. Given these findings, how do we help? I believe that by promoting financial literacy, developing affordable technology and providing tailored grants and financial services, we can play a small role in cultivating a sustainable ecosystem for these entrepreneurs.

The Role Of Financial Literacy In Driving Financial Inclusion

Let’s first talk about financial literacy. New business owners frequently seek guidance on tracking personal versus business expenses, managing cash flow and preparing for tax season. In most cases, people aren’t starting a business because they want to worry about the business side, it’s because they are passionate about something that they want to develop for the world.

Yet, the reality is, taxes, expenses, payroll and compliance are all parts of running a business, and cash flow is the lifeblood of any business owner. Ensuring that the digital entrepreneur who is just starting out has access to tools to improve their financial literacy is a key component to driving greater financial inclusion, thereby reducing the stressors that negatively impact their well-being.

For my company, this includes building products with simplicity at the core, enabling even the most nervous entrepreneurs to get started with ease, and offering a tiered pricing model that allows business owners to get started using our platform at no cost.

Businesses can also look to offer supporting resources or community hubs to encourage financial literacy beyond their core product offering. Visa's Get Paid portal brings creators together to exchange their best tips and advice for successfully monetizing their business and helping content creators realize more opportunities to get paid. The Acceleration Project is a fantastic non-profit organization that pairs small business owners with consultants to up-level their skills in areas that include financial literacy.

Artificial Intelligence: Harnessing Optimism For The Technology

Shifting the focus to AI, specifically generative AI, we found there is optimism and a significant appetite for adoption amongst digital entrepreneurs. Many view AI as an efficiency driver; however, it does not come without concerns, particularly among content creators. Worries include potential copyright infringement and fears of compromising the quality of their work. This highlights the delicate balance required between embracing technological advancements and safeguarding the unique aspects of individual creativity.

Striking the right balance between embracing AI's efficiencies and addressing these valid reservations is crucial in ensuring AI meets its potential in the world of digital entrepreneurship. As a digital entrepreneur, look for ways AI can add efficiency to work streams that aren’t your strength, but remember that no technology can replace your unique talent and craft.

The Need For Grants, Support And Mentorship

According to Goldman Sachs, access to funding is considered a big source of financial stress among respondents, with 77% of small-business owners being concerned about their ability to access capital.

Rising interest rates and economic uncertainty have no doubt caused tremendous challenges for small businesses seeking funds. While solving these issues is no simple feat, businesses can do their small part by creating programs to help alleviate the burden for microbusiness owners.

For instance, we launched the Elevate Creatives Fund, a grant program that offers funding and accounting coaching to creators and creative entrepreneurs. This is only one example of how businesses can create initiatives tailored to the specific needs of digital entrepreneurs, even if what's being offered falls outside of the company's core product offerings. Another great example is Coca-Cola's use of 70 independent bottlers as part of their supplier system, directly including small-business owners within their operations. On a smaller scale, larger companies can look to hire solopreneurs or independent contractors for areas in their business that need additional support rather than turning to larger, established agencies.

Addressing the challenges faced by entrepreneurs requires a holistic approach that starts with acknowledging the overlooked struggles faced by this important segment of small businesses. Corporations and communities have a role to play in addressing many of the financial and other stressors that impact the mental health and well-being of this group. By working together, we can collectively support digital entrepreneurs in their efforts to thrive as they grow their businesses.


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