Essence of Enterprise - The third age of entrepreneurship

Over the next decade the world will face change like never before. As the internet becomes well charted territory, genetics, robotics, nanotechnology, artificial intelligence, autonomous transport and even commercial space flight are emerging as horizon technologies set to extend human possibility.

Essence of Enterprise - The Tech Workout

At the same time, this is also the decade of “super-ageing”, with Germany, France, the UK, US, Hong Kong and many other global nations numbering one-fifth of their population over the age of 65.

The golden years have been replaced by active ageing, meaning entrepreneurship is more likely to be on the agenda for those in their 50s, 60s and 70s. The 2015 Kauffmann Index estimated one quarter of all start-ups in America were headed by entrepreneurs aged between 55 and 64, up from just 14 per cent in the late 1990s. Meanwhile in the UK, The Prince’s Initiative for Mature Enterprise estimates one in six businesses is started by people over the age of 50.

Those who start in business for the first time in their 50s are attracted to entrepreneurship by the opportunity to be their own boss and change their lifestyle. It is therefore unsurprising that they prioritise flexibility, working closer to home and enjoying what they do.

While often characterised as a glide path to retirement, our research including 65 successful entrepreneurs who started out in their 50s found on average they employ slightly fewer than 100 staff and have a turnover of USD6 million. The majority also have no intention to quit. Indeed, more than one-third say they have yet to achieve their goal of financial independence.

Perhaps more surprising still, one in 10 of them set up in the technology sector. Typically characterised as a high-growth, high-burn industry, the tech sector is often seen as the domain of the Millennial generation – especially the start-up scene.

Motivation

However, at the same time as growing their businesses, our research shows that entrepreneurs in their 50s and 60s understand the importance of a good work-life balance. They are comfortable delegating, preferring accountability over direct responsibility, and recognise the challenges inherent in growing a business – particularly when the economic environment is uncertain.

Charlie Hoffman, Managing Director of HSBC Private Bank in London, advises leading entrepreneurs on their wealth management needs. For five years, Mr Hoffman also co-chaired the judging panel of the UK Private Business Awards, which celebrate success and achievement across the breadth of private businesses in the UK.

He attributes older entrepreneurs’ different attitudes to: “the experience, wisdom and the bumps and bruises that come with age”.

“Older entrepreneurs have broader and deeper networks, which is important for doing business but also for raising finance,” adds Mr Hoffman. “And they have a greater sense of security so they can search out the best people for their team without feeling threatened.”

However, starting out in business for the first time later in life is still relatively rare. It is more common for entrepreneurs who have built their businesses through their 20s, 30s and 40s to exit their businesses in their 50s. It is not unusual for these successful leaders to seek a second bite of the cherry.

“They are normally highly driven individuals. Many want to stay busy and active, but they also want their freedom,” says Mr. Hoffman.

Success has afforded these entrepreneurs the luxury of time and the ability to choose how they continue their business-owning careers.

Priorities

A few go on to start a second operating company, but many more become angel investors or take board positions to stay actively involved in business.

Indeed, it seems regardless of whether entrepreneurs are starting out for the first time later in life, or staying active in business after an exit, the same things matter.

Entrepreneurs in their 50s and 60s want to remain active and engaged, but above all they want to set their course in a way that allows them to enjoy the experience of business leadership.

Far from being the glide path to retirement, older entrepreneurs are re-charting their path to personal fulfilment and sustained success.

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