- Average entrepreneur in the U.S. starts their business at 42. In the software industry, the average age is 40. In the oil and gas industry, it's closer to 47. (National Bureau of Economic Research)
- Women in the U.S. between the ages of 45 and 64 start new businesses at about the same rate as men in this age group. (Global Entrepreneurship Monitor)
- At top-performing startups (top 0.1% of growth in first 5 years), an average entrepreneur in the U.S. starts their company at 45. (National Bureau of Economic Research)
- 63% of women business owners are Millennials or Gen-X, compared to 56% for all business owners. (Guidant Financial)
- Latina or Hispanic women own 2.3 million businesses in the U.S. (American Express)
- 38% of Americans between the ages of 18 and 34 started new businesses in 2019. (Global Entrepreneurship Monitor)
On the heels of these stats, here are 4 steps to start the Entrepreneurship journey
Ideation – What problem to solve?
We are all walking, talking data collection machines. Additionally, we are all consumers of products or services. As such, ideas to serve our fellow consumers are all around us, every day. An entrepreneur’s first and foremost task is to identify an unmet demand or provide incremental/supplemental improvement to existing product or service . If one restaurant could serve the need for all customers, there wouldn’t be a fast food chain on every corner.
Validation – Supply and Demand?
Online search can very quickly help validate ideas. If it’s a brand new concept or even an existing business, validation tools such as Business Model Canvas, Experimental Canvas + Validation Canvas, can ensure hypothesis, risks and results can be quickly pressure tested. Zappos did this effectively and eventually got acquired by Amazon for 1B+.
Startup cost – Will it drain your nest egg?
Entrepreneurs in the U.S. use a mix of cash, gifts and loans to get their businesses off the ground. Some notable statistics here:
-
In the U.S, 58% of small businesses start with less than $25,000, and
1/3 start with less than $5,000. (Kabbage)
-
37% of owners in the U.S, use cash to start their businesses. (Guidant
Financial)
- Venture capital, such as seed funding, is another lever to bootstrap. This however, implies you have already given away some equity in your business, albeit gained some advisors in the process.
Success Rates – Growth comes with time.
Starting and running a business is challenging. According to research,
age and experience play key roles in Entrepreneurs success. A few data
points in this regard:
-
50-year-old founder is 2x more likely to reach a high growth rate than
a 30-year-old founder. (National Bureau of Economic Research)
- Starting a business that closely aligns with previous experience are more likely to achieve high growth (in some cases up to 125% more likely). (National Bureau of Economic Research)
In summary…
An entrepreneur is a person who takes an idea (vision) to start a
business, a process known as entrepreneurship. Starting a business takes
dedication, risk management and much sacrifice to achieve that vision.
Entrepreneurs enter this realm because they love what they do, believe
their vision will have a positive impact, and expect to benefit from their
efforts. Entrepreneurs stimulate the economy, employ people and offer
product/services that add value for consumers.
1 Comments
Thanks for sharing the link to this article on Quora and responding to my question, Can one start a business in his or her 40s and be successful?
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