Forget Retirement and Build a Company!

What age group would you guess has engaged in the most entrepreneurial activity over the past decade? 20-somethings? 30-somethings? If you had Mark Zuckerberg or Sergey Brin in mind, you were way off. In a report I just happened upon from last June, Dane Stangler of the Kauffman Foundation writes that there was one age group that was responsible for the most entrepreneurial activity for every year from 1996 to 2007: 55-64 year olds, with the group’s share on the upswing at the time.
A few other fascinating statistics include:

– The 55-64 year old age group averaged 33% more activity over the ’96-’07 time period than the 20-34 year old age group
– A longitudinal survey of 5,000 companies that began in 2004 showed that 2/3 of founders were between 35 and 54 years old
– The average age of the founders of technology companies in the United States is 39, with twice as many over 50 as under 25

When first reading this, I was taken aback. When I think entrepreneur, I think about 25 year old Stanford grads in a garage, not about my parents!

Stangler argues though that several macro-trends account for this, including:

– the shifting age distribution of the country (Baby Boomers) 

– the concept of a “lifetime job” becoming less and less prominent. This is the idea of the career man or woman who stays with a company for their entire career. Stangler writes that this rate of long-term employment among 35-64 year olds has dropped considerably in the past 50 years.

– people are living longer and healthier lives, allowing them to do more with them. The 70-year old entrepreneur in 2020 may well be a common occurrence. 

– technology has made firm creation much easier in the Internet age. Stangler argues that barriers to entry and transaction costs (i.e. what has historically made it difficult to start a business) have decreased in recent years.

So forget Florida and golfing. It’s time for wealth creation, baby!

I believe firmly that any true economic recovery is going to come from ambitious innovators who dare to try something new. For the Boomer generation, this means taking the significant experience gained from years of work and turning it into a company with compelling business growth strategies. At OpenView Venture Partners, a Boston-based venture capital firm, we have invested in expansion stage companies with founders of all ages and look forward to investing in great ideas across generations for years to come!