A quick Google search of startup founders will more than likely present you with images of relatively young entrepreneurs. This goes hand-in-hand with the idea most of us hold, that startups are run by cool, hoverboard-riding millennials. But statistics say otherwise. It seems the reality, maybe not as sexy, is that most successful startups are in fact, run by the hoverboard-riding millennial’s mom and dad.
Let’s start off with some of the statistics. A recent Kauffman study shows, against all the stereotypes of startup founders, that those who are the most successful are in fact 40 years old. More revealing than this, the same research states that there are twice as many successful entrepreneurs over the age of 50 as there are under 25.
But what about the unicorn’s? Again, the popular belief is that millennials are the ones coming up with the truly disruptive, life-altering ideas. Yet, an analysis of US-based unicorns, those valued at over $1 billion by public or private market investors, shows the opposite. For example, the founders of LinkedIn, the second-most valuable company that was analysed, averaged an age of 36, whilst those at Workday, the third-most valuable, averaged at 52.
It is worth mentioning that the founders of Facebook, the breakout super-unicorn of the decade, were in their 20’s. However, taking in the ages of all of the founders of unicorn companies, the average age at founding was still 34. So it appears that these successful twenty-something entrepreneurs are the anomalies.
In fact, in the last two decades we have only seen an increase in entrepreneurial activity from those aged between 55 and 65.
So Why Haven't Millennials Kept Up With Expectations?
Millennials may have an entrepreneurial mindset, but where they lack is in action; in taking the risks necessary to make a new business venture successful. But when we look at the context in which they came of age, we get an insight as to why: rising student debt and a recession that rivalled that of the 1920s.
With the average student debt for millennials at $28,000, many will turn to jobs that can guarantee a steady salary and be relatively risk free. Similarly, the recession would have shaped the minds of millennials to make more conservative decisions regarding their finances. Basically, their willingness to take risks has declined at the same time as their debts have increased. So much so, that according to GEM, in 2014 those aged 25-34 were more worried about failure than those aged 35-54.
Retirement is Out
Another contributing factor that helps explain why more and more people continue to work for longer is simply because retirement is later down the line for most people. What was previously thought of as the age you stop working, somewhere between 60-65, is no longer the same: the 65’s of today are not the same as the 65’s of the previous generation.
Just take a look at Mick Jagger. Despite being 74 years old, he is still touring Europe with energy that rivals even the best of us. He epitomizes this new generation of “young-old”, which has come about from decreasing birth rates and increasing life expectancy. In turn, this is predicted to increase the dependency ratio from 13% in 2015 to 38% by the end of the century.
On more basic terms, this means that because this generation is in relatively good health, they are more likely to continue working past the age of 65, and not out of necessity, but rather because they can. They may not be as big of a draw as the Rolling Stones front man, but they have a wealth of knowledge and expertise that can be a boon to the economy, rather than a drain.
So let’s go back and look at why older entrepreneurs, or elderpreneurs if you will, have been more successful in their business ventures.
There is a perception that older generations are out of touch with today’s technology, and with today’s world in general. But elderpreneurs inherently have more knowledge and expertise than the younger generation attempting to come up with the new Google or Facebook. They have worked jobs that they have loved as well as jobs that they have hated. As a result, they were able to cumulate enough knowledge to notice a real need that can be the foundation for a successful business.
Similarly, they have established much deeper networks, and we all know the importance of networking in accelerating your career. In fact, co-founders that have a history together, whether it’s previous work experience or having gone to the same school, have experienced the most success in their business ventures. They know what makes each other tick and how their varying skillsets can complement each other not just in the short-term, but in the long-term as well. Because at the end of the day, starting a company is relatively simple, it’s pushing through and running that company where those with little real-world knowledge will struggle and fall short.
Lastly, and also most obvious, elderpreneurs are financially more secure than their younger counterparts. They are able to invest much more in their venture and will also be more willing to take the necessary risks that would send millennials with student debt running.
So it seems that people, just like a good wine, get better with age. Of course, age isn’t the defining factor of success. An entrepreneur can be 21 or 78 and still be successful, it’s just a matter of mentality, of having enough experience to set up a business that will be of value.
It just happens that the majority of successful founders today are in the 55-65 age bracket. They have the expertise, have witnessed what has worked and what hasn’t, and have been able to apply this knowledge to their own venture.
But of course, even if the current portrayals and perceptions of budding millennial entrepreneurs don’t quite live up to the reality of today, it could be the reality of the not-so-distant future. After all, they are the most educated generation.
At the end of the day, it’s never too late or too early to start on your big business venture. All you really need is the idea, the perseverance, and maybe someone to help you along the way. If you haven’t met that person yet, fret not, these days there’s lots of places you can meet your future business partner. One of those places is coworking spaces, specifically designed to encourage collaboration amongst like-minded individuals, you’re sure to come across someone who shares your vision.
If you’re curious to give one a try, it’s as easy as visiting www.flyspaces.com and booking a tour!