Mark Zuckerberg founded Facebook when he was 19 years old. By 25, his company was valued at over $5 billion. At 28, he took Facebook public. Now, at the age of 35, he is among the top 10 richest people in the world.
When we think of entrepreneurs, we tend to think of the Mark Zuckerberg’s of the world – youthful visionaries who disrupt traditional businesses with a new and better ways of doing things.
New research, however, challenges the view that youth is advantageous to entrepreneurial success. Perhaps a better entrepreneurial archetype is that of Herbert Boyer. Boyer founded Genentech at the age of 40 based on his breakthrough discoveries in genetic engineering. Or, consider the story of David Duffield. Duffield founded Workday, a financial and human capital management software company, in his 60’s, after spending a career in application software. Now, Workday has a market capitalization of over $40 billion.
The data is increasingly showing that it’s never too late to start a business. Below are five research-backed reasons why entrepreneurial success may come quickest to those who wait.
1) The stereotype of the very young and very successful entrepreneur is exactly that – a stereotype.
It turns out that the media may be the biggest culprit in perpetuating the belief that entrepreneurship is a young man’s game. For example, the website TechCrunch gives annual awards to the “most compelling startups, internet and technology innovations of the year.” The average age of award recipients from 2008 to 2016 was 31. Inc. magazine and Entrepreneur magazine also publish lists of “entrepreneurs to watch.” In 2015, the average age of entrepreneurs who made this list was 29. Compare that to the average age of a typical startup founder (42) to see the discrepancy.
2) Not only are older entrepreneurs more common, they are more successful.
42 is the average founder age of all S-corporations, C-corporations, and Partnerships that registered in the United States between 2007 and 2014. Examining the performance of these companies reveals yet another trend: companies with older founders tend to outperform companies with younger founders. Looking at the top 1% of startups (in terms of company performance), the average founder age increases to 43. Looking at the top 0.1%, the founder age increases even more, to 45. Moreover, the average age of startup founders who achieved a successful exit (as defined by an acquisition or an IPO) is 47.
3) Entrepreneurs working in major entrepreneurial hubs are no younger than other entrepreneurs.
Another misconception is that startup founders practicing in the hottest entrepreneurial hubs – think Silicon Valley and New York City – are younger than in other areas of the country. Again, the data does not show this to be the case. The average age of entrepreneurs in California, Massachusetts, and Silicon Valley is also 42. And, in New York City, the average entrepreneurial age is only one year younger than average (41).
4) The average age of new entrepreneurs entering the market over the past decade has increased.
Given the rise of technology and technology-related entrepreneurship, one might guess that the average entrepreneurial age has fallen in recent decades. Again, the data suggest the opposite. The average founder age has risen from 41.8 in 2007 to 42.5 in 2014.
5) Certain fields attract entrepreneurs that are older than average.
Not surprisingly, there is truth to the idea that technology is a young man’s game. However, the age spread is not as wide as one might think. For instance, startup founders operating in the software publishing industry are, on average, 40 years old (two years younger than the overall average). That said, there are other fields that attract older entrepreneurs. For example, the average age of founders in the pipeline transportation of natural gas, basic chemical manufacturing, and paint, coating, and adhesive manufacturing industries are 51, 48, and 48, respectively. Startup founders operating in oil and gas extraction and engine, turbine, and power transmission equipment manufacturing are also significantly older than other types of entrepreneurs.
Conclusion. The novelist George Eliot famously said, “It’s never too late to be what you might have been.” This is sage advice for all aspects of life, but it might be especially relevant in the case of entrepreneurship.
The data presented in this article can be found in the following research report, forthcoming in the American Economic Review: Jones, B. F., Kim, N. J. D., & Miranda, M. J. (2018). Age and High-Growth Entrepreneurship.