AI Could Spark the Next Great Wave of Small Business Ownership
The conditions that created America's 1950s small business boom are showing up again. This time the catalyst isn't the GI Bill. It's artificial intelligence.
Key Points
- The post-WWII era created the greatest small business boom in American history, and today’s AI moment shares striking parallels.
- AI tools have collapsed the cost and complexity of starting a business so dramatically that one person can now do what used to require a team of ten.
- We may be at the beginning of a new entrepreneurial golden age, not because of policy, but because the barriers just fell.
Introduction
I’ve started, bought, sold, and run over 23 businesses since 2016. Some of them were terrible ideas. A few were decent. But every single one of them required something that most people don’t have: time, money, or a team willing to work for free.
That’s changing. AI is changing it. And when I look at what’s happening right now with business formation in the U.S., I keep seeing echoes of something that happened before. Something big.
The Last Time This Happened
After World War II, America experienced the greatest wave of small business creation the country had ever seen. Between 1945 and 1965, millions of new businesses opened their doors. Small and medium businesses accounted for over half of GDP during that era. Main streets across the country were built during this period.
The conditions that made it possible weren’t complicated. Millions of veterans came home with new skills, a sense of agency, and access to the GI Bill, which covered education, training, and startup capital. At the same time, consumer demand was exploding. Suburbs were being built. The interstate highway system opened up new markets. And the cost of starting a small business was relatively low compared to what it would become in later decades.
The formula was simple: give a large number of capable, motivated people access to education and capital, lower the barriers to entry, and create a market ready to buy. Entrepreneurship took care of the rest.
I’ve been thinking about this a lot lately, because that formula is showing up again. Different decade, different tools, same structural pattern.
The New GI Bill Is a Laptop and an AI Subscription
Today’s version doesn’t come from Washington. It comes from the tools themselves.
In the last two years, AI has collapsed the cost of starting a business in ways that would have seemed absurd in 2022. Things that used to require hiring a developer, a designer, a copywriter, a bookkeeper, and a marketing consultant can now be done by one person with a laptop and a few hundred dollars a month in software subscriptions.
I’m not being theoretical here. I run businesses this way right now. I use AI to draft contracts, generate marketing copy, build internal tools, analyze data, write documentation, handle customer research, and automate operational workflows. The work that used to require a team of five to ten people across my companies now gets handled by me and a small set of AI tools.
The numbers back this up beyond my own experience. A solopreneur tech stack today costs somewhere between $3,000 and $12,000 a year. That’s a 95 to 98 percent reduction compared to hiring even a small team. The Census Bureau counts roughly 30 million solopreneurs in the U.S., contributing an estimated $1.7 trillion to the economy. And business applications hit 5.5 million in 2023, the highest annual total ever recorded.
People are starting businesses at a rate we haven’t seen in a generation. That’s not a coincidence.
The Displacement Pipeline
Here’s the part that makes this feel even more like the post-war era. After WWII, millions of people were displaced from their previous roles. They were soldiers coming home, suddenly needing to figure out what to do next. Many of them chose to build something of their own.
Today’s version of that displacement is happening through layoffs and restructuring driven by AI adoption. Tech companies alone have laid off over 350,000 workers since 2023. Many of those people are highly skilled, technically literate, and comfortable with digital tools. They’re also realizing that going back to a corporate job that might get restructured again isn’t the safest bet.
So they’re starting businesses instead. The U.S. Census Bureau reported 5.5 million new business applications in 2023, the highest annual number ever recorded. These aren’t all people who always dreamed of being entrepreneurs. Many of them got pushed, looked around, and realized the tools to build something independently had gotten remarkably good while they weren’t paying attention.
The post-war veterans had the GI Bill. Today’s displaced workers have Claude, Cursor, and a Vercel free tier.
What Changed About the Barrier
The real story isn’t just that AI tools exist. It’s what they eliminated.
Starting a business has always had two fundamental barriers: knowledge and execution capacity. You needed to know how to do things like accounting, marketing, legal compliance, product development, and customer service. And even if you knew how, you needed enough hours in the day, or enough people, to actually do all of it.
AI demolished both barriers simultaneously. You don’t need to know how to write a contract from scratch if you can prompt an AI to draft one based on your situation and then have a lawyer review it for a fraction of the cost. You don’t need to be a developer to build an internal tool. You don’t need to hire a marketing agency to create a content strategy.
I built the website you’re reading this on with AI. Not as a gimmick. Because it was the fastest path from idea to launched product. I use AI to write code, generate designs, draft copy, and debug issues in real time. The entire site went from concept to live in a fraction of the time it would have taken me two years ago.
I’ve watched founders I advise through Rotate go from napkin sketch to a working platform in days, not the weeks, months, or years it would have taken before. That kind of compression changes who gets to be a founder. It’s no longer just people with savings, connections, or a technical cofounder. It’s anyone with a clear idea and the willingness to learn.
That’s what happened in the 1950s, just with different tools. The GI Bill didn’t just give veterans money. It gave them knowledge (education) and execution capacity (training and startup capital). AI gives people the same two things, just through software instead of institutions.
The Market Is Ready
The demand side matters too. In the post-war era, there was massive pent-up consumer demand. People wanted houses, cars, appliances, services. The market was hungry.
Today the market is hungry in a different way. Businesses need AI integration help. Consumers want personalized services. Every industry has inefficiencies that a small, nimble operator can address faster than a large company can restructure to fix. And unlike in previous eras, distribution is essentially free. You can reach customers globally from day one through social media, content marketing, and marketplaces. The 1950s entrepreneur needed a physical storefront. Today you need a domain name.
What I Think Is Coming
I think we’re at the very beginning of a new entrepreneurial golden age in America. Not because of any policy or economic theory, but because the practical barriers to starting and running a business just dropped by an order of magnitude, right at the moment when a large number of capable people are looking for something new to do.
The parallels to the post-war boom aren’t perfect. Nothing in history ever repeats exactly. But the structural conditions are remarkably similar: a large pool of skilled, motivated people, dramatically lower barriers to entry, tools that multiply individual capability, and a market full of unmet needs.
Even the frontier labs are starting to notice. OpenAI recently published a policy paper proposing “AI-first entrepreneurs” as a future initiative — essentially a description of what thousands of people are already doing today.
I’ve been building businesses for years, and I’ve never seen the gap between “I have an idea” and “I have a running business” shrink this fast. The people who recognize this moment for what it is and start building now are going to look very smart in ten years.
The best time to start a business might be right now. And for the first time in a long time, you might not need anyone’s permission, funding, or team to do it. Just a laptop, a good idea, and the willingness to figure it out as you go.