Something to Think About for the Coming New Year: You're Not Too Old to Be an Entrepreneur
Worried that your graying hair is a sign that you've missed your chance? Don't fret -- you're not over the entrepreneurial hill yet.
The media is filled with stories of young entrepreneurs who have made it big. Mark Zuckerberg was only 19 years old when he founded Facebook. Evan Spiegel’s Snapchat app already had 1 million users when he was 22. And, of course, both of these founders became billionaires. Look a little closer, though, and you'll see clearly that these founders are laudable exceptions to an entirely different rule.
That rule has to do with worrying that you're too old to be an entrepreneur" -- something that may be on your mind this time of year with the approaching new year.
Using data from the U.S. Census Bureau and IRS, researchers from MIT and Northwestern University found that 2.7 million entrepreneurs started businesses between 2007 and 2014. And their average age? 42. If that’s not surprising enough, the researchers also learned that the entrepreneurs with the highest-growth businesses were even older: 45 on average.
Not only is it not too late for you to found the startup you’ve been dreaming of for years, but you have a better shot at success than someone 20 years your junior. If you’re worried that your graying hair is a sign that you’ve missed your chance, don’t fret -- you’re not over the entrepreneurial hill yet.
There are many possible reasons why older entrepreneurs tend to perform better. Better access to capital, a more developed network of professional contacts and a wealth of experience compared to that of their younger counterparts are all potential contributing factors. As an older founder, it’s up to you to capitalize on these advantages. Here's how:
1. Make smart financial choices when funding your venture.
When starting a business, more mature founders have a lot going for them. Tasks like obtaining licenses or a tax ID and applying for loans are easier for older entrepreneurs to take on, according to the Kauffman Foundation’s 2018 State of Entrepreneurship Address.
For instance, the organization’s survey showed that only 14 percent of startup owners 45 years of age or older felt that applying for loans was difficult, while 21 percent of respondents younger than 45 said they struggled with that task. In addition, a 50-year-old founder is 1.8 times more likely to build one of the highest-growth firms than is a 30-year-old founder. This data can help you sell yourself and your idea to investors, who otherwise tend to favor young founders.
Of course there are some down sides here: First, because of your age, don’t be too quick to throw in your 401(k) dollars to help fund your venture. You won’t have as long as a twentysomething to earn back what you take out, especially if your new business struggles to make a profit in its first few years.
Likewise, make sure you’re continuing to contribute to your retirement rather than devoting all of your extra income and savings to your business. As U.S. News and World Report pointed out, you need to protect your assets as you establish your business so that you don’t lose everything if your business struggles. The best method of accomplishing this varies from state to state, but choosing the right business entity type and purchasing business insurance are good steps to take no matter where you’re located.
2. Connect with younger mentors and mentees.
Mentors don’t have to be graying old folks who start every story with “Back when I was your age …”
There are plenty of young people, too, who have a lot to offer, including valuable social connections with up-and-coming members of the workforce. After all, networking has likely contributed to your career success thus far. So, keep networking with members of the new generations entering the workforce, and they’ll be a huge help when it comes time to hire top talent. In addition, having a younger mentor or mentee could inspire you to keep an innovative mindset.
If the word “networking” makes you cringe, relax. You don’t have to attend stuffy functions and scatter business cards to strengthen your network. Instead, help out the people around you as best you can. If you have experience hiring, and a fellow entrepreneur is looking for his or her first employee, offer to take that entrepreneur to lunch and explain the hiring mistakes you’ve made in the past. When you offer help without expecting anything in return, people feel drawn to return the favor.
3. Be proud of what you know; be humble about what you don’t.
Those 19-year-olds who strike it rich have every reason to feel empowered, but youth and immaturity may lead them to become obstinate and egotistical. Almost everyone familiar with the social network has heard the story of Mark Zuckerberg’s original Facebook business card, which reflected the adolescent attitude of a founder who didn’t understand how much responsibility his position entailed.
Having a few extra decades of work experience obviously doesn’t mean you know everything, but it’s still invaluable. David Disiere, founder and CEO of QEO Insurance Group, advises older aspiring entrepreneurs to “Take confidence from your past experiences -- both personally and professionally. You no longer carry the naïveté of youth.”
That said, remember that most industries are continually evolving and it will take a great deal of work to make your vision a reality. Whatever your previous triumphs, it’s your ongoing personal growth that will determine your long-term business success.
So, adopt the mindset of a lifelong learner: Read a lot, and register for seminars or college courses that teach skills you’re seeking to bolster. And don’t be afraid to ask your young mentors/mentees for their insights on everything to from tech adoption to marketing to Gen Z. They may not have all the answers you seek, but they can help you ask the right questions.
Certainly, there are many reasons to keep your day job: A lower tolerance for risk, a lack of sufficient funding or a good idea with no viable market are all smart reasons to forgo your founding ambitions. Age, however, is one factor that shouldn’t deter your entrepreneurial spirit.