By Jeanne Gallagher and Dana Yamashita
Typically, it seems, the world of entrepreneurship is driven by the young, technically proficient, and adventurous. It might be time for them to share the road.
A recent study done by Hao Zhao, an associate professor of management at the Lally School of Management at Rensselaer Polytechnic Institute, found that the rate of success for those who launch a business in their 50s is about the same as those who do so in their 20s. The paper, recently published online in the Journal of Business Venturing, found that those in their 30s and 40s are not quite as successful in launching a new business.
As the population in the United States ages, Zhao said, “Correcting people’s negative stereotypes about older entrepreneurs, and encouraging people at later life stages to engage in entrepreneurship, is important.”
The study revealed that although the younger entrepreneurs tend to be more adept at inventing new technology, the older generations bring with them more experience, more financial capital, and more business connections. Although they might end up with a slightly lower growth rate, they tend to find higher levels of satisfaction and experience more financial success.
The study also found that age has a positive and significant effect on the success of female entrepreneurs. “Our findings suggest women should not give up too readily, because their chance of success increases as they move to later life stages, and their perseverance ultimately tends to pay off,” Zhao said.
Prospects for those in midlife are not quite as good, perhaps because child care and elder care obligations require more time and financial resources, issues typically not a drawback for older workers. Zhao suggests his research supports the idea that government agencies and business incubators should identify channels to foster entrepreneurship for older adults as well.
The paper was co-authored with Gina O’Connor of Babson College, Jihong Wu of the University of Electronic Science and Technology of China, and G.T. Lumpkin of the University of Oklahoma.