Should you start a business if you’re over 55—or is it too late? While we typically think of entrepreneurs as young hotshots, the Kauffman Index of Entrepreneurial Activity reports that the percentage of entrepreneurs aged 55 to 64 rose from 14.3 percent in 1996 to 23.4 percent in 2012. In the same time period, the percentage of entrepreneurs aged 20 to 34 dropped from 34.8 percent to 26.2 percent. In fact, the Kauffman Foundation determined that those aged 55 to 64 are starting businesses at a higher rate than any other age group!
As someone who started a business when I was no longer a young hotshot, I can share some pros and cons of later-life entrepreneurship first hand.
1. Pro: You’ve got life experience. As an older startup, you’ve got real-world knowledge of what works and what doesn’t, how long things are likely to take and how human relationships (an essential ingredient in any startup) really work.
2. Con: You might be set in your ways. As we get older, it’s easy to become inflexible and unable to see possibilities that are obvious to younger people. Surrounding myself with younger people, including entrepreneurs in their 20s and 30s, is one way I make sure I have plenty of fresh perspectives.
3. Pro: You’ve got a network of contacts. Most of us 55 and older have spent decades in the work force and have hundreds of professional contacts to call on. That’s not even counting our circles of family and friends. All of them can be sources of new business and new ideas. I know I wouldn’t have started my business without years of business contacts to pitch as clients.
4. Con: Your skills might need refreshing. One of my friends recalls working for a boss in his 50s who never learned how to work the copier and didn’t even know how to get his own email (he had his secretary print it out for him each morning). If you’re used to an executive position, you may not have had to do the “grunt work” that comes with being an entrepreneur. Nothing’s beneath you now, so start learning!
5. Pro: You might have financial resources you didn’t have in your younger days. Homes, collections, stocks and retirement accounts can all be called upon to fund your startup, since you will need to put some of your own skin in the game.
6. Con: You might need some of that money. With retirement closer than for 20-somethings, you have less room for error. Don’t risk your nest egg; try bootstrapping a low-cost business instead (there are tons of them to choose from).
7. Pro: You’re probably child-free. Unless your college graduate children have come home to roost (in which case, put them to work in your business!), you’re likely an empty nester with time on your hands. What better way to use it than by starting your own business?
Did you notice there are more pros in this list than cons? Clearly, I’m on the side of startup—I’ve been happily entrepreneurial for more than six years now.
Need help assessing your own pros and cons? A SCORE mentor can advise you. Visit www.score.org to get counseling for free 24/7.