A study by the Ewing Marion Kauffman Foundation reported that the highest rate of entrepreneurial activity over the last few years is not Gen-Y upstarts, but Baby Boomers in the 55-64 year age group. In fact, Boomers are actually driving a new entrepreneurship boom as they retire from their traditional corporate jobs and seek more meaningful sources of work.
According to the U.S. Bureau of Labor Statistics, 60 percent of the country’s workforce is currently made up of senior employees, but long-term employment has fallen dramatically for people ages 35-64. Since the first Internet-era recession, transaction costs and barriers to entry have fallen for entrepreneurs of every age. And with longer life expectancies and greater health in later life, older generations are starting new firms and mentoring young entrepreneurs in record numbers.
According to Jeff Mariola, the Boomer CEO of online marketing firm Digital Brandworks, Boomers are also more likely to succeed as entrepreneurs. When I asked Jeff why this was the case, he provided four compelling reasons.
Greater emotional intelligence
The rapid growth and constant change environment inherent in a start-up business requires steady and consistent leadership. Boomer CEOs have worked through countless change management initiatives over the years. They can provide their coworkers with the guidance, inspiration and motivation required to get everyone focused on the vision of the business while acknowledging that the road to get there will naturally be filled with anxiety, fear and exhilaration.
Savvy talent management
The long term success of a start-up relies heavily on the recruitment of the best talent. Boomer CEOs have learned through painful trial and error the artful process of finding the right people. Having made a few bad hires in their time, they understand who to bring on and who to pass on – and why. They have also learned how to get the best work out of existing talent.
Networking that’s finally paying off
Experienced CEOs have a better understanding of how to manage critical external relationships with banks, investors and board members. Credibility is key in these relationships, and the fact that Boomer CEOs have “been there and done that” is reassuring to outside stakeholders. Also, most Boomers simply have bigger networks and thousands of valuable dormant ties as a result of decades of networking.
Financial experience and extra capital
Most start-ups fail because they run out of cash. Boomer CEOs fully understand the significance of cash flow and how to manage and protect it. They have a more accurate picture of what things will cost and how long it will take to turn a profit. Also, most Boomers have more savings to safely invest as capital in their business to give it the best fighting chance. In general, this is how the rich get richer in business.
If you think about it, the qualities and seasoning that make Boomers great entrepreneurs make them great employees and intrapreneurs as well. I always jump at the chance to work with a Boomer because I know I will learn a ton. I have numerous Boomer mentors who I tap for advice periodically. I drink up their experience and perspective like a sweet cocktail, and my efforts are always better for it.
Boomers sometimes get a reputation for being stuck in their ways. But sometimes, it’s because those ways work. So the next time you are tempted to be ageist, recognize that the Boomers have advantages that you don’t and thus should be an essential component of every team.