Kudos to you all who made it to the bottom of last week’s epic email and clicked on the McSweeney’s article. Hope this gave you a laugh.

Another bit of fun: Americans are starting loads of businesses. In fact, the past three years are the highest ever for business starts, measured by EIN applications. 2023’s count was 5.5 million, and that doesn’t include sole props working without EINs. In total, new business starts for the past three years were 16 million.

Some of these new businesses are you. I took a deeper dive into this data for my own business and thought you might find it useful, too.

Who are these founders? SBA highlights from this press release:

• Black business ownership is growing at the fastest pace in 30 years, and the share of Black households owning a business has more than doubled, from 5% to 11%. 

• Latine business ownership is growing at the fastest pace in at least a decade, rising from 7% to 10%.

• The number of women-owned businesses has grown dramatically. The growth rate of women-owned businesses was 94% greater than the growth of men-owned businesses.  

Women now own about 24% of all employer firms and 42% of nonemployer firms. The National Women’s Business Council annual report goes deep on gender-based trends. Loving the construction company numbers.

Where are these businesses? About 10% of new starts are C-corporations filing sub-entities, which is why Delaware performs well. I was surprised to see Colorado, North Dakota, and Iowa as leaders. Are you in one of these states? Tell me, why is Fargo going off?

For industry movers, retail trade and physical stores were the biggest gainers, which surprised me. Less surprisingly, there are 700,000 new professional services firms, largely due to white collar layoffs. So it’s not the LinkedIn algorithm; there are more people doing what you do. Play with Census data by state and industry on this interactive report from the US Chamber of Commerce. 

I look forward to subsequent surveys about whether these folks started businesses because they had a great idea versus being long-term unemployed, unable to find child care or flexibility, called back to the office, denied equitable pay, or unwelcome in their corporate environments. The Fed’s latest study on household economic health reported that 40% of mothers surveyed said they would like to work or work more, but are not due to lack of affordable child care. While this is a lousy driver for innovation, lots of parents start companies out of a need for balance in caregiving. (Including me!) 

Whatever brought you into entrepreneurship, I’m glad you’re here and looking forward to the difference you’ll make in the world with your work. I have lots of getting started resources on my blog, like how to incorporate, care and feeding of your pandemic business baby, and self-funded scaling. You can also submit questions or bring them to my monthly AMAs.

What does it mean? CAN-SPAM 

I have had a distinct uptick in unsolicited emails, so I ran a test using aliases. My (unscientific) finding: when folks follow me on social media or subscribe to my list, they are also adding me to THEIR lists. That’s not a great practice, especially when your recipients are in California. This week, let’s get clear on the foundational rule for commercial email in the US.

This week’s term is CAN-SPAM.

The CAN-SPAM Act is a 2003 US law that applies to using email for commercial solicitation. The acronym means Controlling the Assault of Non-Solicited Pornography and Marketing Act (And people say Congress isn’t fun). CAN-SPAM established seven rules for commercial emails:

1. No misleading header info 

2. No misleading subject lines

3. Clearly identified as an ad

4. A physical location

5. A clear way to opt out of general marketing emails

6. A clear way to opt out of emails as a subscriber or member

7. Prompt action on opt-outs

8. Vigilance over third-party agent uses and activities

Your email provider or CRM is acutely aware of these rules and typically won’t let you begin sending in bulk through their systems until you comply. But these rules also govern direct individual emails to solicit business. Why does it matter? In addition to opening yourself to hefty federal fines, too many people reporting your messages as junk or spam or blocking you will impact your overall deliverability with email providers like Google and corporate email servers. 

If you want to solicit business via email, get comfortable with CAN-SPAM. The Federal Trade Commission (FTC) has a handy and clear compliance FAQ. 

On the pornography part, given the astounding variance in individual Americans’ (and states’) view of “know it when you see it,” you may consider using altered words (i.e., sh*t), images or the good ol’ NSFW label, especially if you foresee a risk that your audience will write diatribes about you perving up their pristine personal bubbles. An offended user may report you to the FTC, state authorities, regional ISP (internet service provider), employer, or email or social media platform. Any of these entities may block your send address or domain for violating their policies. If that happens, you may be shut down for a few weeks or indefinitely.

It’s okay to send transactional or relationship emails to those who opt out. You may receive colorfully-worded replies, which I’ll paraphrase as, “I opted out of your list.” While that’s true, opting out of email doesn’t take you off a list, it flags your address to block commercial solicitations. In fact, it’s required to keep opted out email addresses track and honor opt-out requests and notify users about product and privacy changes.

Final note: CAN-SPAM does not apply to political campaigns. Congress, you are hilarious.

Researching these is fun! Send me your mystery terms.

June dates to know

June 13: June subscriber AMA. Submit your questions now. 

Add AMA’s to your calendar

Apple Google Office 365 Outlook Outlook.com 

June 17: Q2 estimated taxes are due. Despite the Q2 label, this is a short period, taxing your incremental profits in April and May. If you’re a new or newly profitable business, this might be the first period you’re required to file. When in doubt, check in with your tax accountant at least a week in advance.

June 19: Juneteenth federal holiday. If you are open, your full- and part-time hourly wage-based employees may be entitled to 1.5x - 2x their usual rate. Your payroll system should enforce your local wage and hour rules.

Media Kit 

Deadline: Last Friday, California decided solo LLC and S-corp owners in the entertainment industry couldn’t conduct independent business with production companies and studios through loan-outs. This is a weird ruling, especially given the conflicting information on the current EDD claims page, and one that concerns me as a solo California S-corp. The EDD ruling is being challenged and I will be tracking this one closely. More here. 

USA Today: Why Oprah and Taylor Swift won’t be running for president. 

Axios: The average annual price for two children at a child care center exceeded the cost of annual mortgage payments in 45 states.

The Atlantic: all hail new advances in male birth control, including a gel that functions like a vasectomy and a cream you rub into your shoulder, with almost no side effects. Volunteer to be a test subject here.