Is Success Harder for Older Entrepreneurs?

Is Success Harder for Older Entrepreneurs?

Updated Oct. 30, 2013 7:18 p.m. ET

The image of an up-and-coming entrepreneur is often that of a college dropout with an affinity for technology—typically, a male in his 20s. Yet about half of last year’s new entrepreneurs were 45 or older, according to the Ewing Marion Kauffman Foundation, a nonprofit group focusing on entrepreneurship and education. Some entrepreneurs in their 40s, 50s and up say they often have to deal with “age bias” on the part of investors, clients and colleagues. But is it really harder for older entrepreneurs to succeed at building startups? And what, if anything, can they do about raised eyebrows, or snide remarks, about their age? This week mentors on The Accelerators, a Wall Street Journal blog on the challenges of starting a business, weighed in with their views on age bias.Track Record Versus Technology

Older, more experienced entrepreneurs and executives may sense difficulty in getting the attention of investors, especially in the consumer Internet and mobile industry. Meanwhile, seemingly younger and younger “entrepreneurs”— who have never had a job, let alone run a company, in their lives—find themselves sought after by venture capitalists, incubators, angels and all sorts of other sources of capital.

The common reasoning, at least in this new consumer Internet and mobile economy, is that young founders make up for their lack of corporate and management experience with a mastery of the new world of technology. Many claim that older entrepreneurs—people who really aren’t all that old but didn’t grow up with smartphones, social media or even email—don’t have the DNA or intuition that is necessary to make the brilliant viral consumer-tech companies and apps of tomorrow.

Despite the sensational headlines, that doesn’t mean that the more-experienced, older entrepreneur is completely out of luck. While the young, inexperienced, social-product visionary may be more likely to stumble onto the one-in-a-million consumer app that experiences explosive viral growth without any consideration for a revenue model, the more consistent winners are likely to be mature founders who use their prior experiences and industry knowledge to build stable, well-executed, revenue-generating companies.

— Kevin Colleran, venture partner at General Catalyst Partners, Cambridge, Mass.

Experience, Patience and Reputation

There is something to be said for the fresh outlook and innovative ideas that come from youthful entrepreneurs. But the skills that one acquires from years in the workforce can help set mature entrepreneurs apart from their younger counterparts. If experience, patience and reputation are the foundation of an entrepreneur’s skill set, age will become a true advantage.

Experience. One crucial advantage of age is the experience gained from years within one or more industries. The speed and strategy with which an entrepreneur can execute on an idea when he or she has a solid industry foundation is an enviable asset.

Maturity and Patience. Mature founders understand that long-term success requires patience: you make big bets that take years to play out. Rash decisions masked under a veil of innovation are disruptive, in a bad way, to the success of a company.

Reputation. Building a solid reputation takes years, and older entrepreneurs are at an advantage because – in addition to years of networking and relationship-building experience – they have established reputations within their space.

—- Matt Maloney, founder of GrubHub Inc., Chicago

No Age Requirement for Innovation

The fact is that you are never too old to innovate. As well, the wunderkinder who are glorified, including [Mark] Zuckerberg, Steve Jobs and Bill Gates, only achieved success with the help of old, experienced executives.

A key ingredient in innovation is the ability to challenge authority and break rules. Because they haven’t had the limits that we did, today’s youth doesn’t hesitate to question the norms, think outside the box and come up with crazy ideas. But great ideas by themselves don’t lead to breakthrough technologies or successful companies.

Ideas are dime a dozen. The value comes from translating idea into invention and invention into a successful venture.

To do this, you have to collaborate with others, obtain financing, understand markets, price products, develop distribution channels and deal with rejection and failure. You have to be able to inspire, manage and motivate others. In other words, you need business and management skills and maturity. These come with education, experience and age.

— Vivek Wadhwa, vice president of academics and innovation at Singularity University, San Francisco.

Measuring a Team’s Average Age

No matter what age you are, you need to be prepared to devote 150% of your brain to your company, your team and your customers. But 150% of an immature brain doesn’t help. In fact, an important trick of most successful startup companies is marrying the enthusiasm and dedication of youth with the judgment of experience, which comes with age.

A better measure of success might be the combined average age of a founder, the executive team, the top investors and top advisers. For the most exciting companies on Earth, this is not 25.

What you really want when you are going into the startup struggle is a calm temperament. Every firm faces market risk, technology risk, execution risk and management risk. In that last category, the greatest danger is probably not that your team is too old, but that it is too inexperienced.

— Nora Abousteit, founder of Kollabora.com, New York