The Ideal Age to Be An Entrepreneur

If what you see in the media shapes your idea of a successful entrepreneur, you’re probably thinking it’s a young person’s game. Young entrepreneurs are commonly thought to be the most popular. When Bill Gates, Steve Jobs, and Mark Zuckerberg founded their world-changing businesses, they were all in their early twenties.

But do these well-known examples just simply represent a generalizable pattern?

While movies, news, blogs, and TV shows may portray a stereotypical young male dropping out of college to pursue the next big thing, reality tells a different story. 

Photo by bruce mars on Unsplash

Today's studies are attempting to debunk the myth. The superficial Silicon Valley narrative of youthful founders is now upended by data. After all, entrepreneurship indeed knows age, and statistics are here to get into the details to prove it.

Who has the upper hand? The 25-year-old upstart or the seasoned 52-year-old entrepreneur? Let’s find out, shall we?

Entrepreneurship's Most Active Age Group

Startups are growing at a faster pace than they have in over a decade. Global Entrepreneurship Monitor surveyed 65 different global economies and determined that there are more than 582 million individuals who own or are starting a business. According to their study, millennial entrepreneurs, aged 25-40, build the majority of new companies globally today, followed by Gen Z entrepreneurs, aged 18-24.

Check out the graphs below for a better understanding of the world’s Total Entrepreneurial Activity by age group, as published by Global Entrepreneurship Monitor.

The millennial generation has been criticized for a slew of issues, including being too entitled and social media-obsessed, as well as credited with several positives, such as appreciating creativity and possessing higher moral values. One characteristic that distinguishes them is their enthusiasm for the idea of starting new companies and working for themselves. Surveys suggest that millennials value entrepreneurship and startups more than the previous generations, with over 62% considering starting their own business. This conclusion is even backed up by the 2016 BNP Paribas Global Entrepreneur Report. According to it, millennials are starting businesses at a younger age than their counterparts in previous generations. Baby boomers, for example, tended to launch their first business on average when they were 35 years old. Millennials, on the other hand, start their first business around the age of 27, implying that they’re more eager to start to do so and possibly, are more willing to take risks in doing so.

     This suggests that age gaps alone aren't enough to explain the disparity; a generational change appears to be at work.

Average Age of Successful Startup Founders

     Although the vast number of start-up companies created by millennials is remarkable and promising, the average age of a successful startup founder does not belong in their generation. According to a report published in the Harvard Business Review, the average age of people who founded the highest-growth startups is 45.

Photo by Hunters Race on Unsplash

     The study found that the founders of software companies are on average 40, while those in other fields like biotechnology or oil and gas are around 47 years old. Part of the reason, according to the data, is that middle-aged entrepreneurs possess more general business experiences that increases their propensity for eventual success than younger counterparts. Furthermore, entrepreneurs with years of work experience in one particular area were 85 percent more likely to create a successful startup than those with no similar previous experience. Take Forbes’ top two- fastest-growing tech startups in 2018 for example. First Solar was developed by a 68-year-old , and Riverbed Technology was co-founded by entrepreneurs who were 51 and 33 at the time.

     Interestingly, when you take a closer look at Jeff Bezoa and Steve Jobs, the growth rates of their businesses in terms of market capitalization peaked when they were middle aged. Steve Jobs and Apple introduced the company’s most profitable innovation, the iPhone, when Jobs was 52. Jeff Bezos and Amazon have progressed well beyond selling books online, and Amazon’s potential market cap growth rate peaked when Bezos was 45 years old. These prominent founders may not have reached their full potential when they were young, but time and experience have undoubtedly shaped them for greater success as they age.

So, if you feel like you are past your prime and too old to try your hand at the entrepreneurial game, think again. As Maya Angelou said: “All great achievements require time.” After all, it appears that advancing age is indeed a powerful feature, not a bug, for starting the most successful firms.

Is 45, then, the optimal age for achieving one’s peak entrepreneurial potential?

Yes and no. There are many other factors other than age that may clarify which generation possesses the greater advantage of succeeding in the market.

Younger people may have more energy and drive, have longer to reap the benefits of starting a business, are more familiar with technology and trends, and, perhaps most importantly, have not yet learned what they are incapable of. Older people are more likely to have more skills and expertise, including market awareness, and better access to the information, networks and other resources needed to launch a successful business. On the other hand, older people may have more responsibilities, including mortgages and dependent family members, and have more to lose by leaving a well-paying career.  

Obviously, there’s a visible balance to consider between the two. In the meantime, statistics can continue to favor the seasoned entrepreneur, but who says you can’t get the best of both worlds? A younger entrepreneur, paired with a more experienced co-founder or mentor, could potentially tap the advantages of both generations and guarantee greater success.