Remote Work: The Unexpected Incubator for Entrepreneurship

Hey there!

Have you ever found yourself in yet another remote meeting, and somewhere in the back of your mind, an idea for your own business started to sprout? Or perhaps that precious 60 minutes saved daily on commuting to the office has been channeled into developing a “side project” after hours? It turns out, you’re not alone. This phenomenon is happening on a massive scale and has just received solid scientific backing.

A study by the American National Bureau of Economic Research (NBER) sheds light on one of the most unexpected effects of remote work: a sharp increase in entrepreneurship. It’s important to note the context: the analysis was conducted in the United States on a large sample of knowledge workers, whose data came, among other sources, from LinkedIn. Although these results pertain to a specific market, they offer compelling insights into universal mechanisms that could be at play globally.

Remote Work: A Greenhouse for New Ideas

The main conclusion from the study is unequivocal: the more a company allowed remote work during the pandemic, the more employees left to start their own businesses. Crucially, this isn’t just about typical job hopping. Remote work uniquely propels people toward entrepreneurship.

Why is this happening? Researchers point to two key factors that create a kind of “startup greenhouse”:

• Time for experimentation: Remote work is a gift of extra time. The absence of commuting (an average of 65 minutes per day in the USA!) and greater daily flexibility create a space where one can calmly develop and test their own business ideas. This is time we simply didn’t have when working 9-to-5 in an office.
• Safety of “under-the-radar” activities: Developing a project “on the side” has always involved risk. Working from home provides greater privacy and less oversight from the employer. This allows for operating discreetly – safe experimentation while a steady salary still provides a safety net. Remote work acts a bit like a “paid leave for idea testing.”

Not Just “Projects for the Drawer” Are Born

One might think that this primarily leads to small, hobbyist businesses. Nothing could be further from the truth. The study shows that companies founded by former remote workers are of higher quality than the average startup. They are more likely to hire additional employees and have a greater chance of securing funding from venture capital firms. It appears that the extra time and security allow for refining more ambitious, innovative, and risky projects.

What Does This Mean for the Future of Work?

Perhaps we are witnessing a fundamental shift. Innovation is ceasing to be the exclusive domain of large corporations and is becoming more dispersed, fueled by the individual ambitions of thousands of people who have gained a new currency – time and autonomy. For companies, this is, of course, a challenge: how to retain the most entrepreneurial talents. For us, it’s a reflection on how we perceive our careers. Perhaps the path from employee to company founder has just become significantly shorter and more accessible than ever before?

And you? Has remote work unleashed the entrepreneur in you, or, on the contrary, has it made you appreciate the stability of traditional employment even more? Share your thoughts in the comments!

Main Ideas:

• Remote work drives entrepreneurship: A study by NBER shows a direct and significant increase in employees leaving jobs to start their own businesses due to remote work.
• Beyond job rotation: This effect is specific to entrepreneurship, not just general job changes; remote workers are more likely to become founders.
• Key mechanism – experimentation: Remote work fosters business idea testing through:
  • Additional time: Saved commuting time and increased schedule flexibility.
  • Reduced risk: Lower employer oversight allows for “hidden” project development while retaining financial security from current employment.
• Higher quality startups: New companies founded by remote workers statistically demonstrate better quality, often hiring more people and securing VC funding compared to average startups.
• Support for risky projects: The impact is strongest for ventures in high-failure industries, where safe experimentation is most valuable.
• Study context: The analysis focused on U.S. knowledge workers in companies with 10 to 5000 employees.
• Significant economic impact: Remote work accounts for at least an 11.6% increase in new U.S. firm creations in the post-pandemic period.