There’s a lot of misconceptions in business, but few are more pervasive than the belief that the younger you are, the more likely you are to build a business that finds success and transports you from your parent’s basement to a silicone-valley penthouse overnight.
The Kellogg School of Management points out that “Mark Zuckerberg’s statement that ‘young people are just smarter’, or the $100,000 fellowships that Paypal co-founder Peter Thiel hands out each year to bright entrepreneurs – provided that they are under 23,” is evidence of a misunderstanding about a correlation between youth and entrepreneurialism.
“There’s this idea that young people are just more likely to have more valuable ideas,” Benjamin Jones, professor of strategy at the Kellogg School said. “If you look at age and great achievement in the sciences in general, it doesn’t peak in the twenties.”
Jones says that “one idea is that young people are especially likely to have transformative ideas – that they’re not beholden to the current paradigm,” which he counters with the point that the more mature the leader or founder, the more the business stands to benefit. “The longer you’ve been around, the better your odds… Experience can bring substantial insight about specific markets and specific technologies, in addition to skills at running things.” So, when is the best time? “It’s actually a fairly high-stakes question,” Jones argues. “If we’re not allocating dollars to the right people in entrepreneurship, we may be losing in terms of the advances that best raise socioeconomic prosperity.”
It’s hard to put a precise number on it, however, according to a study from two MIT professors and a member of the U.S. Census Bureau, much like a fine red wine, age counts for a lot when it comes to becoming the founder of a successful startup. The research comes courtesy of data compiled from Javier Miranda , and MIT’s Pierre Azoulay and J. Daniel Kim, who amassed data from nearly three million start-up companies over a period of seven years to find what they believe the data proves is the magic number.
According to the study, a 50-year-old is more than twice as likely to create a successful startup operation when compared to a 30-year old. Similarly, a forty-year-old is 2.1 times as likely to create that successful business over a 25-year-old’s chance. That 50-year-old we just mentioned is even more likely to beat the 25-year-old when it comes to forming a successful start-up. The data also shows that a 60-year-old is more than three times as likely to create a successful business when compared to a 30-year-old entrepreneur. The average age of a company’s founder at the time of forming their successful business was 41.9 years, according to the study.
Authors like Jeff Haden put this down to the fact that it “is much harder to develop a sound strategy when you have limited experience. It’s much harder to make smart tactical decisions – especially when you need to make a number of decisions every day – when you have limited experience.”
“This is experience true where leadership experience is concerned”, reasons Haden.
If you’re reading this and you’re nearing your 40’s, just remember, as Jeff Haden puts it: “science proves that your experience, your skills, your connections, your expertise and yes, your age are on your side… start putting all that to work for you. Not for someone else.”