The stereotype of the youthful entrepreneur is a myth, says researchers
Most successful entrepreneurs are older than we think, according to new research from the US.
The average founder of the fastest growing tech startups is about 45 years old; and 50-year-old entrepreneurs are almost twice as likely to have a runaway business success as their 30-year-old counterparts.
The new study’s findings have implications for all entrepreneurs, whatever their age, as well as for venture capitalists, who may be harming their chances of achieving a successful investment by favoring younger entrepreneurs—whether due to misconceptions about the success of younger founders, or because younger entrepreneurs tend to offer investors bigger stakes in their companies.
Young people are digital natives, believed to be cognitively sharper, less distracted by family, and not as bound to current industry standards. But, older entrepreneurs have had years to build their business, leadership, and problem-solving skills, as well as to accumulate the social and financial capital needed to get a startup off the ground.
The study finds that the most successful entrepreneurs are in fact middle-aged.
Stories about Bill Gates, Steve Jobs, and Mark Zuckerberg, who were wildly successful in their 20s, reinforce a bias toward youthful entrepreneurs. However, even companies like Apple and Microsoft did not achieve their most rapid growth until later, when their founders were older, notes Benjamin Jones, Northwestern University professor and a researcher on the study.
“Entrepreneurs are a rare species,” says Alexander S. Kritikos in Entrepreneurs and their impact on jobs and economic growth. “Even in innovation-driven economies, only 1–2% of the workforce starts a business in any given year. Yet entrepreneurs, particularly innovative entrepreneurs, are vital to the competitiveness of an economy.”
Jones hopes the research will encourage older entrepreneurs who may be experiencing doubt because of their age: “It could help unlock more innovative potential from the many many people in the economy that are middle aged and beyond,” he says.
Kritikos further adds that “[t]o attract productive entrepreneurs, governments need to cut red tape, streamline regulations, and prepare for the negative effects of layoffs in incumbent firms that fail because of the new competition.”