My friend Jordi mentioned to me the TechCrunch article Is There A Peak Age for Entrepreneurship? where the author writes in conclusion: “Age is only one factor among many to predict the success of entrepreneurs, and anybody at any age can break any molds put forward by “experts.” However, it’s clear that the stories of a few “college-dropout turned millionaire” (or billionaire) startup founders have clouded both the mass media and the tech industry from reality. We have romanticized the idea of a young founder because, well, it’s a great story, but these stories are not the norm. In the end, classic biases of gender, race, and age need to be discarded for a real science of success.”
Well I am not sure I agree so that I reacted and put there the following comment: “It is clearly a recurrent question and I have humbly a tendency to believe that young is better than old. On slide 27 of the pdf you can find on my blog (https://www.startup-book.com/2009/12/16/start-up-the-book-a-visual-summary), there is anecdotal-only illustration that some famous Silicon Valley entrepreneurs (not all of course) were younger than successful European ones. Then, in a more systematic analysis of Stanford alumni, I looked at how many years after graduation people started companies (slide 23 in https://www.startup-book.com/2010/06/18/high-growth-and-profits). The average is about 9 years but of course it includes the multiple companies of serial entrepreneurs. Finally in slide 26, I show that serial entrepreneurs seem to do worse with time. I have more data that show that those who were successful initially tend to do well again and those who did less well do less well again. So?
A couple of additional comments:
– I believe that high-tech is special as uncertainty is higher because of the risky nature of the products and new/emerging markets.
– I agree with some previous comments that experience is to be balanced with energy, ability to take risks and not being too conscious of them.
– Of course age is only one parameter, and there is also wealth, education, energy, entrepreneurial personality.
– Final comments: entrepreneurs and managers are different. Eric Schmidt did not start Google, he was hired in 2001…”
It is time to take into consideration the statistics about the age of entrepreneurs that were published in the last 2 years. According to an article in Newsweek (August 2010), the average age of high-tech startup founders is 40. The author also states that “older entrepreneurs have higher success rates due to their experience, familiarity with customers’ needs and well-established supplier networks.” Another study, The Coming Entrepreneurship Boom,” by the Ewing Marion Kauffman Foundation, provides interesting facts. The average age of technology start-up founders is now 39. The highest rate of entrepreneurial activity (i.e. the numbers of launched businesses) is to be found in the 55-64 age group. It also grew by 16 % between 2005 and 2008, faster than any other group. Meanwhile, the level of entrepreneurial activity is the lowest among the 20-34 age group …
The romanticism about (very) young entrepreneurs, which can also be called “agism”, is quite obviously in contradiction with the facts.
Sources:
http://bit.ly/rlFhce
http://bit.ly/o12ISJ
The whole Kauffman study can be downloaded here: http://www.kauffman.org/uploadedFiles/the-coming-entrepreneurial-boom.pdf
I fully understand the debate and I still struggle with the data. I have other elements about entrepreneurs with a Stanford diploma or background. And when they are serial entrepreneurs, they do not tend to do better with the successive ventures, as if experience was not sufficient. In high-tech, the level of uncertainty is high in part because the market might be nascent. Could it be that we should have a look at the age for the first company started given the fact that serial entrepreneurs naturally increase the average? I am not sure…
Your statement that serial entrepreneurs do not do better with successive ventures is once again contradicted by serious statistics. The Harvard Business Review, for example, states in “Performance Persistence in Entrepreneurship” that “entrepreneurs with a track record of success are much more likely to succeed than first-time entrepreneurs and those who have previously failed” – which seems rather logical… Anyway, the world of entrepreneurship is by far not limited to high tech, and even less to those entrepreneurs with a Stanford degree. On top of that, the clear increase in entrepeneurial activity in the Baby Boom generation (that is mentioned in the 2nd article in my former comment – Kauffman study) is obviously not the fact of serial entrepreneurs, but of former employees. It would be interesting to know what is the percentage of serial entrepreneurs in this age group (55-64) but I doubt that it is very substantial. Thanks in advance for providing the relevant statistics, if you have them. Anyway, as we say in French, we should not compare dish towels and napkins. The recent statistics about the age of entrepreneurs provide clear information, which contradict the limiting belief that you have to be young to succeed as an entrepreneur. The success rate of new businesses and its causes are a different matter that cannot be dealt with in one sentence.
Source: http://www.hbs.edu/research/pdf/09-028.pdf
I still agree and disagree! The study by Gompers, Lerner et al. that you mention is probably one of the best known indeed. But it states if I am correct that the likeliness to go public when you have gone public before is higher than if you have not. And they only consider entrepreneurs who were venture-backed in all their ventures. So there might be a bias here linked to the measure of success (going public) and to the value added (or not added) by venture capital.
In my own data, I see a similar bias linked to the presence or not of venture capital. Lerner, Gompers et al. also notice that success seems to bring success and failure brings failure (so experience alone is not sufficient, talent is necessary) and I have similar elements of data. But on average as you have more failure than success, serial would indicate less statistical success… I agree Stanford is not everything as high-tech is not, or VC-backed is not. But I have a database of 2’700 founders which is quite interesting (and a minority is VC-backed).
Finally, as I was mentioning in the initial blog, I am not sure how the researchers define entrepreneurs. In the reference I was quoting Eric Schmidt is seen as such, but he never founded Google he arrived in the Start-up at age 46, 3 years after the foundation. Should he be counted as an entrepreneur?
I have the feeling ti is still an area of research and more data needs to be known before we have a full agreement on the impact of age…
An entrepreneur is a man… or a woman who has:
– enough insights to see solutions where most people see only problems
– enough creativity to create things and systems that never existed before
– a huge amount of courage to act, take risks, invest a lot of work/time/money, and sacrifice a part of his /her private life in order to create a new venture
– enough persistence and toughness to do all this over a longer period of time.
I am very much disappointed with this blog. Some time ago, I tought that your intention was to foster the entrepreneurial mindset in European countries and to encourage people to become entrepreneurs. Instead of that, you are increasingly focussing on putting people into little, narrow drawers. You also express over and over again your own personal limiting beliefs as if they were general truths, even when they are obviously contradicted by facts and statistics, even your own ones. You are even trying now to define who “deserves” to be considered as an entrepreneur. This kind of (very French) arrogance is unfortunately typical of the kind of problems that entrepreneurs encounter in Europe. It is also out of place, coming from somebody who never created a business himself.
There are more entrepreneurs in the USA not only because there are ecosystems like the Silicon Valley, more VCs and investment opportunities, etc., but also because every kind of entrepreneurship, even the most modest one, is considered as deserving admiration and support. There are even many words to describe all kinds of entrepreneurs. A pizzeria owner is a “small business owner”. Somebody who starts a consulting business from his/her kitchen table is a “solopreneur”. A mother who works part-time from home in order to take care of her children is a “mompreneur”. There is nobody to look down on them the way you do because they have a service business or a commerce (not noble enough compared to high tech), are baby boomers (as if only young entrepreneurs deserved consideration), are women (who obviously don’t deserve attention either), are serial entrepreneurs (your recent affirmation that they “do not tend to do better with the successive ventures” is not only wrong, it is even insulting), etc.
This kind of arrogance is extremely damaging for the cause of entrepreneurship in Europe.
As you wrote yourself recently on another blog, maybe you should start your own business instead of spending so much time to convert people into rows of numbers.
But I forgot: you are still too young… You haven’t reached the “peak age of entrepreneuship” yet (50-65 years old). But then it leaves enough time to create your business plan…
Well, I will not comment on your criticism, I am not here to justify or agree on my own limitations. Many of your comments are correct, some others we could discuss. It shows the topic is complex. We have one point where we agree: the USA and Silicon Valley still have a lot to teach us with or without rows of numbers. I am trying to communicate on this to the best of my abilities (and limitations) and yes, I maybe should have done something else, but we are what we are, not what we could have been.