What is the Ideal Age to Become an Entrepreneur?

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    Every entrepreneur has their own battles and there is no single formula for everyone. While successful technology companies like Facebook or Flipkart have suggested that you need to be in your 20s or early 30s for your business to shine, studies suggest otherwise.

    What is the Ideal Age to Become an Entrepreneur?

    A study conducted by MIT (Massachusetts Institute of Technology) along with a non-profit US Census Bureau (NBER) titled 'Age and High-Growth Entrepreneurship' concluded that on an average, a 45-year-old is most likely to build successful firms while those in their 20s were the least likely.

    This study was based on founders of all businesses in the US launched between 2007 and 2014 (over 2.7 million founders). It busted the myth of younger population being able to build a successful business due to their agility and abundance of time and energy as they do not hold responsibilities of mortgage or family.

    The study also pointed out that a 50-year old founder was 1.8 times more likely to create highest growth firms compared to a 30-year old.

    Another study conducted by Sandler Training in the UK (United Kingdom) in 2015 said that the average age of an entrepreneur there was 47.

    Although these studies did not state the reasons for their success, it makes sense to say that a person in their 40s is more likely to be financially stable, has a stronger network of contacts and good industry insight (factors supporting the ability to raise capital). The individual is also more likely to have learned from his/her mistakes and gained a better grasp of the area of interest. If they have an experience working with a start-up business, they will also be able to understand the workings of a business rather well compared to a someone just out of college.

    In some cases, like Steve Jobs with Apple, though the business was started at an early age, it only gained success and recognition when he was older. It was established in 1976 but became one of the most valued companies after the launch of iPhone in the 2000s.

    This goes to say that while some businesses might get too big too fast (WhatsApp for example), they are likely to be sold to established firms due to incapability to handle the increase in volume.

    The experience and qualification an individual is going to gain by the time they reach their 40s could help them make decisions with certainty. They will be able to deliver stable returns for their investors and stakeholders, helping their business gain more funding.

    Read more about: entrepreneur business
    Story first published: Tuesday, May 22, 2018, 12:18 [IST]
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