What is the Best Age to Start a Business?
At what age or stage of your life are you ideally suited to be an entrepreneur? Is it when you're a teenager living under your parents' roof with nothing to lose, or is it when you're 23, newly married, and full of hope? Maybe it's when you're 27 — a bit more mature and experienced with some connections and a little money in your pocket. Or perhaps the best time to start a business is when you're 45 with 20 years of business experience, $200,000 in the bank and a wealth of contacts you can leverage. I interviewed entrepreneurs from various backgrounds and stages to get their opinions.
Start 'em Early
The entrepreneurs I spoke with while writing this article favored starting young, with the majority favoring the mid to late twenties as being the ideal age to start your first real business. What they all emphatically agreed on was that business experience can't start at too young of an age. Many entrepreneurs can point to a business experience from their childhood, such as the traditional lemonade stand, that sparked the interest leading them to where they are today.
Such was my own experience. When I was in elementary school I found ways to earn pocket money by mowing neighbors' lawns and collecting their soda cans and newspapers to take to the recycling center.
"I think the best age to start a business is about 13," says Bill Aho, CEO of Utah-based ClearPlay. "It may succeed, or it may fail, but there is generally very little risk and the basic lessons remain the same — you get rewarded for working hard, taking care of your customers, sticking to it and marketing your business. Too many adults, whether they are just out of college or 50 years old, don't really appreciate these simple principles."
Brent Hicken, a real estate investor in Colorado, actively encourages his young children to start small ventures, like setting up a small booth selling snacks at the local pool.
"When they go out and buy something to resell and learn to think about covering their costs, they learn to appreciate our family's finances as well," he says. "It really started for our kids when my wife and I decided to go into business for ourselves. I talk with my 13 year old about the details of buying an apartment building so that he can understand more about being self-sufficient and generating income streams that can support the activities he wants to participate in later in life."
The Roaring 20s
Not only do many experienced entrepreneurs believe that starting out young is best, but so do many potential entrepreneurs in their early 20s, as evidenced by growth in the enrollment of college students in entrepreneurship programs. According to a 2006 study, in the early 1980s less than 400 universities offered courses in entrepreneurship and small business. Today more than 1,600 schools offer courses designed to aid students in starting their own businesses (http://newsinfo.iu.edu/news/page/normal/3520.html).
Entrepreneurs in their 20s often profit from good health, high energy levels, little to lose, a high tolerance for risk and boundless optimism. Like a basketball player in the NBA, an entrepreneur can do things when he's 25 that he won't be able, or perhaps willing, to do when he's 35.
I used to enjoy the "entrepreneurial glory" of staying at work all night and occasionally sleeping on the floor under my desk, but working late has lost its luster for me since I turned 30.
At age 25 an entrepreneur doesn't have as much to risk by starting a business as he or she will at 50. Chances are a 25 year old doesn't have a second house, three cars, a boat, and a well-funded retirement plan — and therefore can't put them at risk. If an entrepreneur makes a mistake at 25 years old, there are still many years to be successful and with the experience comes wisdom. A serious mistake at 50 might wipe out in six months the wealth that took 20 years to build.
However, it is far from true that a 25 year old has nothing to lose. They only have less to lose than those who have more. A 25 year old can easily put him or herself in hundreds of thousands of dollars of debt through the use of bank loans, credit cards and loans from family and friends. Trust me, I know what I'm talking about. There are some things you can only learn from experience. You can either learn from the experiences of others or from your own, and maybe experience is a factor for those who would prefer to start a business later in life.
Slow and Steady Wins the Race?
I believe there is something to be said for starting a business when you're older and I'm not alone on this one.
"I can tell you that I am a lot more confident now at 33 than I was at 27 when I was in my first real startup," says local entrepreneur Chris Knudsen. "The younger you are the more able you are to take on risk, but the older you get and the more experience you get — you may have a better chance at success."
Someone in his or her 40s will probably have more resources to bootstrap a new business and be in a position to get more favorable terms on debt financing if needed. And in presenting to investors he or she will not have to make excuses about youth and inexperience. On the other hand, if you wait until you're 40 to start a business, you may have learned to work so well in a corporate environment that you'll lack the mental flexibility to roll with the punches of small business ownership.
I recently heard of a successful Utah-based business, started by young entrepreneurs, that when put in the hands of a "more experienced" businessman, immediately started trending downwards. It wasn't that the businessman didn't have experience, but he was trying to apply what he had learned at a $100 million company over the past 10 years to a $2 million business.
Those who wait until later years to start a business might benefit from their experience, but they might also be well advised to beware of what they know.
Perhaps the ideal way to start a career in entrepreneurship would be after having worked at several startups or small businesses, but not in the founder role. By working as an employee at a startup, you get the benefit of seeing firsthand what it takes to start and manage a business without any greater risk than losing your job. While there's no replacement for the experience of being in the driver's seat, working for an entrepreneur is about as close as you can get to being one.
Opportunity, Not Age
Many entrepreneurs feel that age and situation aren't the factors to consider. "Opportunity is what is needed, not experience, security, or age," says Jeff Barson, founder of over 10 companies during the past 15 years, most of which are still in business. But he can't resist slanting his advice towards starting younger.
"The opportunity cost for starting a new business is extreme and only goes up with a spouse, kids, mortgage and lifestyle," Barson says. "I think it's these factors that inhibit many would-be entrepreneurs from quitting their existing jobs and joining a startup."
Lance Black of Eli Kirk shares sage advice he received from his father. "When I was about 14, my dad told me, ‘Son, whatever you do in life, make sure it makes you money when you're sleeping.' At the time, he was referring to his beef cows standing at the manger eating hay and gaining weight, but the principle he taught me holds true today. I believe that the age someone should start a business is the age that he or she realizes the truth in my dad's statement and is willing to take the appropriate risk to finally ‘do it.' Many people believe the statement but are unwilling to expose themselves to the risk involved. The age may be 15 or it may be 50. For me it was 32, for my brother it was 45. For my dad, it was 18. He is 83 now and still going strong."
Brock Harris, founder of skateboard manufacturer Mothership Distribution, agrees that age isn't what an entrepreneur should focus on because, as he sees it, it's going to be hard no matter when you start.
"There's never a right time to go into business for yourself," Harris says. "Time is never quite on your side, money is always a lot tighter than you think and resources are always much, much more limited than you previously thought."
A Personal Perspective
I was 16 when I started my first "business." My father was the sole investor, and I was the sole employee. I didn't make a lot of money, but the experience was a turning point in my life that affected what I studied in college, what I chose to do for work, and what I think about from day to day. It also led me to start my first "real business" at 24, which has grown into the business I run today.
Like my first business, my current business hasn't made me a millionaire, but the experience has been invaluable.
I love entrepreneurship and business in general. Without that help from my parents when I was young, I'm not sure if I ever would have discovered my passion. Starting out young was the right path for me as it has been for others, but it may or may not be for you.
The advice I would give is similar to what I've heard from many of the entrepreneurs with whom I associate — if you have the spark, do something about it now. Life is too short to spend eight hours a day at a job just waiting for the day to end when you could be waking up eager for your 16-hour day to begin.