Why Entrepreneurship Is An Attractive Option For Older Adults
Entrepreneurship isn’t just for twentysomethings.
While the word startup conjures up images of founders in their twenties making a go of it in their college dorm rooms, entrepreneurship isn’t just for the young. In fact, the trend for older individuals to create and run a thriving business is accelerating.
People 55 to 64 accounted for 22.8% of entrepreneurs in 2021, based on a report published by the Ewing Marion Kauffman Foundation. And since 2020, the percentage of businesses founded by adults in that age range has increased in the U.S., U.K., France and Germany, according to the Global Entrepreneurship Monitor. Plus, founders aged 45 and over now account for between a quarter and a third of all new entrepreneurial activity.
While some older adults start a business because they want to be their own boss, others do it to pursue a long-held passion. If you’re inspired to strike out on your own, here are some powerful reasons to move forward.
Careers Are Getting Longer
By 2034, older adults (age 65 and above) will outnumber children (age 18 and below) in the U.S. for the first time in history, based on projections from the U.S. Census Bureau. With individuals living longer, they are also working longer, which makes the traditional 40-year career a thing of the past. Instead, 60-year non-linear career paths will likely become more common. With such a long career trajectory, an individual’s values and priorities will inevitably shift. At some point, flexibility and fulfillment become more important — especially if you assume caregiving responsibilities. That makes entrepreneurship an attractive career option.
Older Professionals Bring A Lot To The Table
There are benefits to having a few grey hairs. Professionals in their 40s and 50s have amassed a set of skills and transferable experience that become a significant advantage when starting their own business. At that age, you tend to know your strengths and weaknesses as well as what you want and don’t want. Even though it might seem riskier to “take the plunge,” older professionals are usually more financially stable. That makes it easier to create a side hustle or go all in and start a business from the ground up. Finally, the more experienced you are, the bigger your network. A robust network of contacts makes launching your business that much easier. Not only is networking a great way to find prospective customers, but it can also help establish connections with potential investors.
Older Entrepreneurs Are Innovative
According to research, people who start a business later in life (defined as 50 years and above) create the most economic value by introducing radical innovations that disrupt markets. The study, published in the Research Policy journal, shows that older founders are more likely to introduce new products and services to the market than younger founders. In addition, every ten more years of age increases a founder’s likelihood to introduce a market novelty by up to 30%. That makes late-career entrepreneurs who are highly innovative with managerial experience more than three times as likely to introduce market novelties than the sample average.
Entrepreneurship Has Advantages Over Corporate Jobs
More than 40% of employees over the age of 40 say they’ve experienced age discrimination at work in the last three years, according to a recent AARP survey. In that same survey, 90% of respondents said a job must offer meaningful work before they would accept the position.
“Older workers see their jobs as part of who they are. A majority of older workers seek employment with meaning,” says AARP senior research advisor Lona Choi-Allum.
It’s also important to note that with mass layoffs becoming the norm, corporate jobs aren’t as secure as they once were. In 2022 alone, more than 17 million workers were laid off or discharged, according to the Bureau of Labor Statistics. Given the evidence of age-related discrimination in the workplace and the advantages of flexibility and autonomy that come with being your own boss, later-life entrepreneurship is an appealing alternative.
Whether you’re mid-career or approaching retirement, it’s never too late to pursue entrepreneurship. Just be sure to define your goals, create a plan and take small steps before jumping in with both feet. That way, you’ll mitigate the risk while making your experience, skills and connections work for you.
