What's the Best Age to Start a Business?

By Stephanie Meyers

When should you start a company? It's an ongoing debate with two pretty clear sides: the wisdom of age versus the prime of our lives. 

In a recent thread on Quora, the question attracted a lot of attention, thanks to some big names who jumped to respond. 

It all started late in August when an anonymous user asked:

What do people in Silicon Valley plan to do once they hit 35 and are officially over the hill? Since life in Silicon Valley ends at 35 unless you hit it big or move up in management (and simple logic tells you that most won't), I'm curious what people younger than this think they'll be doing at that age.

Since then, the thread has only grown, mainly with comments from programmers over 35 who found success. Among them were Wikipedia's Jimmy Wales, TechCrunch's Michael Arrington, Netflix's Reed Hastings, Craigslist's Craig Newmark, and Zipcar's Robin Chase. 

Those entrepreneurs were 35, 35, 37, 42, and 42, respectively, when they founded those companies, not surprising since the Kaufman Foundation found the "average and median age of U.S.-born tech founders was 39," and "twice as many were older than 50 as were younger than 25."

Meanwhile, 24- to 35-year-olds have only become more risk-adverse with time, according to an American Express survey, which found 16 percent started businesses right out of school, a 12 percent drop from 2007. 

Perhaps that's why a suggestion from Wales, now 47, seemed so on point. "A better question might be," he wrote on Quora, "How can we in the tech community make sure that unusual success at a very early age is not mistakenly thought to be the norm?"

After all, age is only a number. 

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Never Too Old To Start a Business

By Issie Lapowsky

Silicon Valley adores its wunderkinds. It's easy to look at the Mark Zuckerbergs and Jack Dorseys of the world and assume that youth is a necessity, or at least a major benefit, when starting a business.

And yet, according the Kauffman Foundation's annual Index of Entrepreneurial Activity, the rate of new businesses being started by entrepreneurs between 20 and 34 has actually been falling in recent years. Meanwhile, the number of businesses created by older entrepreneurs between the ages of 55 and 64 is rising drastically. In 1996, just 14.3 percent of new entrepreneurs were older than 55. By 2012, that number had risen to 23.4 percent.

Now there's a conference specifically targeting this demographic of entrepreneurs.

On Thursday a non-profit called the Center for Productive Longevity launched a national conference in Washington D.C. to promote entrepreneurship in the over-50 crowd. The event is the brainchild of 86-year-old Bill Zinke, who previously founded and ran a management consulting firm that focused on issues that arise with older workers. Around 2007, he started thinking about ways to encourage the growing population of seniors to remain productively engaged as they grew older. Drawing on his own experience, he believed entrepreneurship was a particularly good fit for older generations.

"Older people possess something younger people lack: namely experience, expertise, judgment, and performance," he says. "That's why the older people who create new businesses have a better rate of success."

Last year, the Center hosted four regional meetings to encourage people 50 and over to consider starting a business. The national conference will focus more broadly on the policies that need to change in the public, private, non-profit, and academic sectors in order to lower the hurdles for older entrepreneurs. For instance, few academic institutions hold courses in entrepreneurship for older people.

"The reality is, older people don't need the same education as younger people do," Zinke says. Encouraging schools to add more of these classes is one of many calls to action being made over the two-day conference. Another is urging President Obama to set up a presidential commission that would review and improve upon the regulatory environment for entrepreneurs in America.

Zinke insists this initiative is not merely empty discourse. After the conference is over, he hopes to raise funding to sponsor a series of workshops around the country for people over 50 who are interested in entrepreneurship. According to Zinke, the timing has never been better.

"In more recent years, the economy has shifted from being industrial to knowledge-based. Older people can continue working well into their 60s, 70s, and 80s," says Zinke, who founded the Center when he was in his 80s. "I guess I’m an example. And I do not think I’m an anatomical wonder. I simply reflect the reality of demographic change in America."

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7 Things Great Entrepreneurs Don't Do

By Steve Tobak

These days, everyone with a MacBook and a blog thinks he’s an entrepreneur. Well, here’s a little tough love for the entrepreneurial generation: Calling yourself a CEO doesn’t make you one and a small army of Twitter followers doesn’t make you a leader, either.

As a wise VC who’s name escapes me once said, “There are entrepreneurs and there are Entrepreneurs.”

Not to dash your hopes and dreams, but the truth is the vast majority of you simply aren’t cut out to be entrepreneurs or leaders. I know you don’t want to hear that, but it’s true. And the sooner you realize you’re not going to be the second coming of Mark Zuckerberg, the better.

Don’t get me wrong. It’s great to reach for the stars. As Robert Browning said, “A man’s reach should exceed his grasp.” But having grown up in the high-tech industry and worked with hundreds of real CEOs, VCs, and Entrepreneurs for decades, one thing I can tell you is the word has become so overused, it’s almost meaningless.

So while there is no one-size-fits-all model for true entrepreneurs, in my experience, there are some things they seem to have in common. This might surprise you, but what sets them apart isn’t some laundry list of attributes. It’s their actions. What makes them unique is what they do and, perhaps more importantly, what they don’t do.

1. They don’t think about work-life balance.They’re mostly workaholics. What that means is their work comes first. It’s what they live for. They’re not freewheeling, fun-loving people who live for the weekend. They live to do what they love, and that’s work.

2. They don’t try to be what they’re not.Probably the most damaging business myth to come along in decades is personal branding. You are not a product, and you can’t change who you are. Besides, real entrepreneurs don’t think about themselves. They think about their ideas and how to turn them into great products and services. And they deliver.

3. They don’t do it for the money.They don’t whine about how hard they work for peanuts. They just do it. And because they’re passionate about what they do and focused like a laser beam, the money eventually comes, big-time.

4. They don’t have day jobs.Great entrepreneurs don’t just dip their toes in the water. They jump in headfirst without a thought about the rocks below. They don’t do a little of this and a little of that. When they hit on something they think is really cool and exciting, they go all in.

5. They don’t give in to fear.They don’t pay attention to those voices in their heads – you know, the ones that haunt you with everything that can go wrong. They’re not fearless, mind you. Nobody is. They just don’t let their fear stop them from taking risks. They do listen to some voices, though: the voice of reason and their instincts.

6. They don’t have grand visions.While some do have grand delusions that they’re destined for greatness – a prophecy that’s often self-fulfilling, interestingly enough – for the most part, they generally don’t have grand visions for their companies. Zuckerberg, for example, wasn’t trying to create a company. He just wanted to rate the looks of fellow classmates.

7. They don’t have virtual mentors.Most people follow all sorts of writers, bloggers and tweeters these days. That’s fine, but to get somewhere in life, to do great things, you have to have real mentors in the real world. Former Intel chairman Andy Grove mentored Steve Jobs. Jobs, in turn, advised Google founders Larry Page and Sergey Brin. Behind every great entrepreneur is at least one great mentor. A real one.

Most importantly, real entrepreneurs don’t call themselves entrepreneurs. They don’t do what everyone else is doing. They don’t follow the status quo, conventional wisdom or popular fads. They carve their own unique path. They’re leaders of their own destiny. That’s what drives them. And that’s why they succeed.

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Worst to First: 4 Startup Lessons From the Boston Red Sox

By Peter Cohan

The Boston Red Sox won the 2013 World Series--fulfilling my daughter’s birthday wish for me. But in 2012, the Red Sox finished the season in last place in their division. Their journey from worst to first offers some valuable lessons for your start-up.

To be sure, the parallels between a 106 year old sports dynasty and your start-up are incomplete. After all, the Red Sox have different individuals who do many of the jobs-- such as owner, general manager, and coach -- that you combine into one.

But in reading Bleacher Report’s analysis of how the Red Sox turned themselves around this season after 93 losses in 2012, I see four valuable start-up lessons.

1. Listen to your people. If you are a just getting your venture off the ground or taking over the helm from a technical company founder, the first thing you need to do is listen to what your employees are saying to you.

Generally, this is easier to do if you are new to the start-up CEO job. That’s because you can come into the organization as someone who is not the one who made all the decisions that you are inheriting.

So if people are unhappy, you should be in a position to listen to them with a clear mind - unfiltered by the defensiveness that comes from having to react effectively to your bad decisions.

This comes to mind in considering the actions of Red Sox general manager Ben Cherington who took over in 2011. Cherrington’s first year was a disaster - after all, he hired Bobby Valentine as the team’s manager and he angered the players.

According to Jeff Passan of Yahoo! Sports, on August 14, 2012, Red Sox players went to the Red Sox owners John Henry and Larry Lucchino and harshly criticized Valentine during a meeting called after a text message was sent by a group of frustrated players to the team and ownership.

Red Sox ownership realized that it needed to change.

2. Fix your mistakes. As an entrepreneur, you are getting negative feedback all the time. You need to decide whether that feedback is signal or noise and whether you are the cause or can be an agent of change who can solve the problem.

In the case of the Red Sox, that blistering August 2012 meeting between players and owners caused management to realize that the feedback was a signal that must be obeyed and that Cherrington was not only responsible in part for the problem, but that he could also be an agent of change to fix it.

In your start-up, you may be able to play the same role that Cherrington did. Or you might need to kick yourself out of the CEO role and hire someone who can fix the problems that you created.

3. Replace your expensive disruptors with lower-priced team players. In your start-up you may have spent too much money hiring big name talent that does not fit with your culture - or is simply costing too much money. If you realize that this is your problem, will you have the courage to replace the expensive disruptors with lower priced team players?

That’s sort of what Cherrington was able to do on August 25, 2012 when he traded a group of expensive players (not necessarily disruptors) -- Adrian Gonzalez, Carl Crawford, Josh Beckett and Nick Punto with 2013 salary obligations totaling $250 million -- for a group of lower-priced players from the Los Angeles Dodgers.

By lowering the Red Sox burn rate, Cherrington could also afford to bring on the team members -- like Shane Victorino, Mike Napoli, Jonny Gomes, Koji Uehara and Stephen Drew - who helped the team win the 2013 World Series.

If your team is not working as effectively as it needs to, a lesson that you can take from the Red Sox is to lower your burn rate and bring in a team willing to accept less pay who share your values.

4. Be (or hire) a great leader. If your start-up is getting bad feedback, the reason may be that you are not a great leader. Your investors may force you to hire your replacement; they might suggest that you get help; or you may be a great enough leader that you can reinvent yourself on the fly.

And when it came to the 2012 Red Sox, Cherrington’s challenge was not just to fire Valentine but to find a great manager to replace him. And that came on October 21, 2012 when Cherington hired former Red Sox pitching coach John Farrell to replace Valentine.

Cherrington was hiring Farrell, in part, because he could lead a team with a set of values that were inherent to the Red Sox and to players like Victorino, Gomes, and Uehara.

As Bleacher Report wrote, “All these players were lauded for their easygoing approach to the game and bringing Boston baseball back to the forefront. It is a testament to the job Cherington did; not just signing them but going through a vetting process to ensure these players could handle the intense scrutiny that comes with being a member of the Red Sox.“

Like the Red Sox, you need to have a strong culture and make sure that every member of your team fully shares the values that you set.

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Startup Entrepreneurs Have Confidence. Duh.

By Ray Hennessey

Pssst. Want to know a secret? Entrepreneurs are insanely confident.

Of all the data points released about the economy week after week, perhaps the least helpful nowadays is the Kauffman/LegalZoom Startup Confidence Index. With apologies in advance to the Ewing Marion Kauffman Foundation and online legal-advice company LegalZoom – both of which I have no doubt carry the best intentions and otherwise do good work – and, with an additional shout out to John Calvin, tracking startup confidence seems an exercise in predestination.

You will never, ever find a time when startup confidence, as measured by this survey, is not high. Ever. Startup owners are confident, so confident that, well, they started a company. One needn't waste human hours tallying numbers to express that.

Let's take a deeper dive into the numbers themselves, released this morning. Despite what the companies call “ceaseless uncertainties in Washington” and “mixed signals” on the economy, it turns out the confidence of owners of startups is at a new high of 86 percent.

Put aside that the “new high” isn't all that significant since the survey has only been tracking sentiment since the first quarter of last year. There are other, more significant problems with the survey and the results:

The life of the businesses surveyed is too short. In ordered to be surveyed, you had to have started a business within the past six months. This is the biggest problem with the data compiled: You are talking to people who felt optimistic enough about their own abilities to quit their jobs and start a business. It puts to mind what Reed Hastings said, that to be an entrepreneur “you have to feel like you can jump out of an airplane because you're confident that you'll catch a bird flying by.” Entrepreneurs may succeed or fail, but confidence never flags.

It asks the wrong question. The lead question is a simple one: “How confident are you that your business will be more profitable in the next 12 months than it is today?” Well, most businesses are not profitable in year one, let alone in the first six months. So, since you are asking people who are trying to turn losses into a viable business whether or not they think they will be more profitable, isn't the answer always “yes?” And, if not, does that matter? Many tech startups have multi-year business plans that call for many quarters in the red. That doesn't make them any less successful, particularly since they probably have raised a war chest of cash to burn.

The survey tracks respondents by age. According to the latest figures, 95 percent of 18-to-30-year-olds and 94 percent of 31-to-40-year-olds feel certain about near-term profitability. That the youngest group should feel more confident again shouldn't be a surprise, because they lack long-term experience in being able to judge consumer demand. There is some evidence that younger entrepreneurs are less successful than older ones.

It is not a predictor of future startup activity. One would think that entrepreneurial confidence would lead to a higher rate of startup creation among the younger demographic groups. In fact, it hasn't. Just look at Kauffman's own Index of Entrepreneurial Activity, which showed the share of startup activity by people between the ages of 20 and 34 fell from 34.8 percent in 1996 to 26.2 percent in 2012. At the same time, the share of companies started by people aged 55 to 64 rose from 14.3 percent to 23.4 percent. So, if confidence is higher among the younger entrepreneurs, why is the growth rate for new business creation so much higher among older entrepreneurs? Well, it is because the population is aging. It has little to do with changes in confidence.

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7 Steps to Finding Success as a Millennial Entrepreneur

By Blaine Vess

Older generations say millennials have short attention spans, a sense of entitlement, and little patience. The fact is, those qualities are not necessarily bad -- especially for young entrepreneurs.

What some call faults can actually be advantages if leveraged in the right way. The key is finding that sweet-spot between youthful enthusiasm and the more “old-fashioned” values that have served as the backbone of business for generations. I started my company when I was a freshman in college. Fourteen years later, we are generating annual revenues in excess of $10 million.

Here’s what I’ve learned about striking that balance:

1. Stay energetic. Starting a successful business requires tireless enthusiasm. You have to be excited about the product or service you’re providing. If you’re not, no one else will be. On the flip side, enthusiasm is infectious. Your excitement can help you secure business leads and build a committed, energetic team. Your Gen X and Boomer counterparts can attest, you will never have as much energy -- and stamina to work through late nights -- as you do now.

2. Be impatient. Ironically, sometimes the same people who tell you not to be so impatient will remind you that the early bird catches the worm. What they don’t realize is that your impatience stems from your desire to get that worm! Take that impatience and run with it. When a problem arises, don’t wait around hoping it will get resolved. Take action to fix it immediately. Speed and your drive to produce immediate, quality results will serve you well.

3. Take risks. Launching a successful business almost always requires risk taking. Lucky for you, that pill is pretty easy to swallow right now. When you’re young, you have less to lose from a failed business attempt than you will ever again. If you think you have a good idea, give it an honest try. At the very least, you’ll learn something. Now is the time to be bold.

4. Stay social. Do your parents ask you for help with “the Twitter?” When you’re done rolling your eyes at them, consider what an advantage you have as an entrepreneur. Social Media is indispensable for expanding your network, increasing product awareness and building your brand. While older business owners may be struggling to learn the latest social protocol, it’s already second nature to you.

5. Seek help and advice. Smart entrepreneurs know how and when to ask for help. Talk to business owners you admire, read about successful innovators, and seek out a mentor.

6. Hire experience. There is something to be said for life experience. Consider hiring someone older than you when it makes sense. You’ll set yourself up with a team that has the benefits of youth and the advantages of experience. Mark Zuckerberg hired Sheryl Sandberg, a woman with 15 years more experience than he had. Both of them contribute differently to create a company balanced in youth and business expertise.

7. Stay social, for real. Forming real, personal relationships is good business, and this is often best done face-to-face. I love social networking, but it’s not a replacement for getting to know someone in person. Take your hand off the mouse, move your eyes away from the screen, and go meet someone. What are you waiting for? Your next client is out there waiting for you to find them. 

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