Q: Hi Steve – I am in my mid-60s and the funny thing is, I would like to start my own business. Throughout my career, I had always loved the idea of becoming an entrepreneur, but for one reason or another, I never did it. Now I have the time and resources and can do it, but I wonder, am I too old? My wife thinks it’s a little late in the game to being trying something so new/radical. - Vince
A: It’s an interesting question – is there actually a right time to become an entrepreneur? Michael Dell started Dell Computers out of his college dorm room. Steve Jobs was in his early 20s when he co-founded Apple Computer. Bill Gates famously dropped out of Harvard to start Microsoft. Across the pond, Richard Branson was also a teenager when he had to barter rent to open the first Virgin record store above a shoe shop in London.
On the other end of the spectrum, Wally Amos was 40 years old when he started Famous Amos Cookies and Colonel Sanders founded Kentucky Fried Chicken when he was 65.
So, is there a best time to become an entrepreneur?
The short answer is no; you never know when inspiration will strike or when the stars align just so such that you have the motive, opportunity, and ability to go off on your own. But that said, it is also important to know that there are both pros and cons to starting business at different ages.
In your 20s: Not a few young people fall in love with the idea of being their own boss because, frankly, that is what being a young person is about in many regards. They strive to figure out their place in the world and want to do things their way, so naturally becoming an entrepreneur is attractive. This is even truer lately given the changing nature of work and that “job stability” is an oxymoron.
The bad news is that starting a business when you are younger has some built-in odds against it. Typically, a younger person had neither the money nor experience that is often necessary to make the business a go.
But, on the upside, they don’t know what they don't know, they have a lot of energy and enthusiasm, they have less to lose and have more time to recover from failure. You are also more apt to try out and use some shoestring startup business ideas when you are younger.
Late 20s to late 40s: This is almost the perfect time for would-be entrepreneurs, for many reasons:
- At this point in life, they know what they like, and what they don't like
- They have obtained business and life skills
- They have some assets and credit
- They have confidence and connections
And also, the risks are somewhat less (though there will always be risk.) Because of skills and money, the chance to succeed increases. When you are young, you have few connections and less money, and when you are older, you are less likely to risk either, but here, right in the middle of life, like Goldilocks’ last porridge, the risks and rewards are “just right.”
Older age: Not a few Baby Boomers have started businesses lately out of necessity because of the economic downturn. While the good news is that these older folks have the experience, resources, and business skills to give their new venture a significant leg-up, it is still quite risky.
Why? Because if you are older and you fail, you don’t have time to make up the lost money. And if you used your retirement to fund the business and it goes south, you are really out of luck. That is a lot of risk to take on.
Want to be part of this column? Then ask Steve a question! Visit his new site for TheSelfEmployed to get in touch with him.