Experienced entrepreneur mentor helping young entrepreneur on a hike.
Relax if you are in your 20’s or early 30’s and you still have not started your company. The dream might be that you start your small business when you are in your early 20’s. The reality for a small business in the USA is radically different. The latest statistics from the Small Business Association from 2021 show that there are 32.5 million small businesses in the US, which account for 99.9 percent of all US businesses. And more than half (54%) of America's small business owners are over the age of 50. When might be the best time to start a small business? Perhaps when you are a little older, more experienced and wiser.
Don’t give up on that great business idea or problem, no matter how old you are. People who start businesses in their 40s, 50s and even into their 60s typically succeed as well if not better than younger entrepreneurs, extensive research reveals. A study that was published in the January 2021 issue of the Journal of Business Venturing finds entrepreneurs who begin while in their 50s succeed at roughly the same rate as people starting up in their 20s. For example, Netflix, E-Trade, Zoom and Home Depot founders where all older than 37 when they launched their companies.
The research, involving a review of 102 previous studies that each looked at an average of more than 600 entrepreneurs, suggests younger entrepreneurs may be more aggressive and more tech savvy, while people in their 50s often start with more wisdom, financial capital and business/network connections. Some research experts have theorized that younger entrepreneurs have better cognitive skills, greater awareness of current technologies and trends, and less resistance to disruptive change that can be crucial to successful innovation. While that may all be true, such advantages rarely seem to outweigh experience.
So, what can you learn from entrepreneurs that are older than you? Plenty. As a matter fact, just look at what their advantages are and try to gain some of those benefits at an earlier age on purpose. Seek out an experienced entrepreneur as a mentor to accelerate your learning. Here are several things you can do to better prepare for launching your startup in thinking like an experienced entrepreneur.
Industry knowledge matters. Whatever your passion or experience, if you like the industry you are currently in, then really understand it. Stay abreast of the latest trends, read industry reports and meet with several entrepreneurs in the industry. Gaining insights and perspectives on potential problems or shifts could lead to your startup.
Domain experience is important. If you ever start a company one day, your job title is not entrepreneur. You will be doing something in the startup and your best contribution is to be an expert in that area. Whether is finance, marketing, project management or analytics, prepare now to be the best you can be in your profession. As you perhaps join with other co-founders, you will hopefully all be experts in your area and create a powerful team.
Your network is key. Gen Z and Millennials seem to be a little less concerned with developing robust or deep networks and that is a mistake. You can’t wait to build a network later when you might crucially need one. The time to build the foundation of a great network is right now. Look at your strengths and weaknesses; surround yourself with experts to negate any weaknesses and perhaps gain more insights.
Need a growth mindset. Carol Dweck from Stanford has built her research life around studying mindsets, both fixed and growth. Fixed mindset says you believe intelligence is fixed at birth through DNA and a growth mindset says intelligence is not fixed, knowledge can be learned. Her research has proven that whatever mindset you have, we all have the possibility of a growth mindset. Choosing to have a growth mindset is probably the most critical decision you can make as an entrepreneur.
Know your pathways to entrepreneurship. While most people who want to start a company think they actually have to start one from scratch, there are multiple ways to become an entrepreneur. One of the fastest ways to becoming an entrepreneur is to simply work for one and learn all you can. Second, you can actually buy an existing small business from a retiring baby boomer. Third, perhaps you buy a franchise business that already has good brand recognition and just needs perfect execution in a new location.
