Older entrepreneurs are more likely to succeed
Many studies have tried to correlate an entrepreneur’s age to start-up success. The facts are revealing.
According to HBR (2018) the average entrepreneur is 42 years old when they launch their start-up. I
In 2015, George Deeb himself a serial entrepreneur found that people aged >55 are 2x as likely as people aged <35 to launch a high-growth start-up., and the average age of a successful startu-p entrepreneur with over $1m in revenues is 39. He attributes this to industry experience, managerial experience, and a network of contacts. He selected a few high profile entrepreneurs leading successful companies and compared their ages at start-up; Facebook (20), Microsoft (20), Apple (21), Google (25), Twitter (30), Amazon (30), Tesla (34), Oracle (35), Netflix (37), Zynga (41), Walmart (44) and McDonald’s (53).
HBR went further and found that
.Entrepreneurial performance improves very quickly with age, peaking between 55-60. .So, success does not depend on age and whilst past experience is a factor it is not prerequisite to success. “Relative to founders with no relevant experience, those with at least three years of prior work experience in the same narrow industry as their start-up were 85% more likely to launch a highly successful start-up.”
HBR also asserts that even the top 0.1% of entrepreneurs – Bill Gates and Steve Jobs ‘outliers’ – had what it takes early but only harnessed their full entrepreneurial potential in their 50’s. It takes that long to get the experience you need to really put the foot to the floor.
Deeb adds that one’s appetite for risk might be different at age 45 than when 29, but taking risks is more informed and calculated. He says that he is “materially more efficient” and knows how best to prioritise his time to what matters most and to extract a high return on that investment of effort. Experience counts.
In light of this evidence, says HBR, “why do some VCs persist in betting on young founders? We cannot definitively answer this question with the data at our disposal, but we believe that two mechanisms could be at play. First, many VCs may operate under a mistaken belief that youth is the elixir of successful entrepreneurship — in other words, VCs are simply wrong.” Speculating further, HBR says VCs “may seek investments that will yield the highest returns, and it is possible that young founders are more financially constrained than more experienced ones, leading them to cede upside to investors at a lower price.” . Maybe.