Successful entrepreneurs are young: This common bias is being seriously challenged in a world where people are living longer and healthier, thus changing the way we think about age and ageing.
With a median age of 42 for the economically active in Switzerland and a quickly aging population, it will come as no surprise that Switzerland is seeing an increase in self-employment among people over 50, as a study by the University of Applied Sciences of Northwestern Switzerland (FHNW) has shown.
In this blog we share 8 reasons why being older can be an advantage when starting a business, based on our daily experience advising entrepreneurs.
One of the biggest advantages that older entrepreneurs bring to the table is their experience which gives them a deep understanding of market trends, human and consumer behavior and business operations. This knowledge is an asset for making informed decisions. It is also particularly helpful to anticipate challenges and manage their businesses using the expertise they gained over the years.
The older you are when you start your business, the more extensive your network of contacts is likely to be. Experienced new entrepreneurs can build on the wide range of contacts they have developed throughout their careers and outside of work. Why are these relationships an important asset when starting your own business? Because they are a potential source of support, insight, mentors, customers and also potential collaborations that can help accelerate the growth of a new business.
Starting your own business when your children have left the home means more disposable income and less family-related financial commitments. This frees more resources to take steps such as creating your own company, particularly if the business is started as a side activity and not your main source of income.
The financial security of a (early) retirement pension can also be an incentive to create an own business because receiving a pension makes the entrepreneurship “income gap” and risk smaller than when being self-employed is your main source of income.
Such elements provide a safety net enabling so-called silver entrepreneurs to take calculated risks and invest in their businesses without immediate financial pressure. An additional advantage that older entrepreneurs have is that they may have assets which can be leveraged to secure financing or entering strategic partnerships.
Life experience can also be a further asset for starting a business after 50. At that stage in life, many people will have overcome various personal and professional challenges and learnt how to recover from setbacks and be perseverant. This gives them an advantage in the unpredictable world of entrepreneurship.
“Silver entrepreneurs” who faced a variety of challenges and situations at work and in life have the advantage of being able to take a longer-term perspective on the challenges they face, thus influencing their business strategies.
Irrespective of whether you have led teams or not, years of experience mean that you are likely to have observed different leadership styles and company organization systems. This gives you a deeper understanding of how to manage yourself, how people work together and how to lead them, which are critical skills for building and managing a successful team.
New entrepreneurs starting the self-employment journey after 50 will often have explored different career paths and had time to reflect about the purpose they want to achieve with self-employment. This is helpful in achieving long-term goals as this clarity leads to a more focused and purposeful approach to entrepreneurship.
The FHNW study and other research shows that in many cases, older entrepreneurs tend to start a business in areas where they have extensive expertise (and therefore a strong network too). This wealth of industry knowledge is invaluable and can be a competitive advantage, allowing them to identify niche markets, anticipate trends and innovate in their chosen field. This expertise can give them an advantage over younger competitors who may be in the process of acquiring industry-specific knowledge.