8/3/2019 The Case For Old Entrepreneurs

http://slidepdf.com/reader/full/the-case-for-old-entrepreneurs 1/2

washingtonpost.com http://www.washingtonpost.com/national/on-innovations/the-case-for-old-

entrepreneurs/2011/12/02/gIQAulJ3KO_story.html?tid=sm_btn_linkedIn

The case for old entrepreneursBy Vivek Wadhwa, Publis hed: December 2

“People under 35 are the people who make change happen,” said venture capitalist Vinod Khosla, “People

over 45 basically die in terms of new ideas.”

Khosla, who believes that old entrepreneurs can’t innovate because they keep “falling back on old habits,”said this at the NASSCOM Product Enclave in Bangalore, on Nov. 9.

Vivek Wadhwa

Vivek Wadhwa is vice president of Academics and Innovation at Singularity University and Arthur & ToniRembe Rock Center for Corporate Governance at Stanford University. His other academic appointmentsinclude Harvard, Duke and Emory Universities as well as the University of California Berkeley.

Failing America’s students: Eric Ries, entrepreneur andauthor of "The Lean Startup" spoke with the Post's

Michelle Williams about how the U.S. education system isfailing students by failing to reward risk-taking.

He isn’t alone in his views.

Silicon Valley VCs talk openly about their bias towardyoung entrepreneurs. Some argue that Internetentrepreneurs peak at the age of 25.

Khosla and those who think like him are wrong.

The young may have good ideas, but there is no

substitute for experience. You aren’t born with themanagement, marketing and finance skills necessary toturn ideas into successful ventures. This obsession withthe young may be why the venture capital system is insuch steep decline and underperforms key public marketindices, such as the Russell 2000. VCs are doingthemselves a big disservice by ignoring the realinnovators: old, experienced people.

In 2008, I led a research team in exploring thebackgrounds of 652 U.S.-born chief executive officers andheads of product development in 502 successfulengineering and technology companies established from1995 to 2005. These were companies with real revenue --not just the start-ups founded by the college dropouts thatsome venture capitalists like to fund. We learned that the average and median age of successful founderswas 39. Twice as many founders were older than 50 as were younger than 25. And ther e were twice as manyover 60 as under 20.

In a follow-up project, we looked at the backgrounds of 549 successful entrepreneurs in twelve high-growthindustries. The average age of male founders in this group was 40, and the average age of  female founderswas 41. The majority had two or more kids. Kauffman Foundation director of research, Dane Stangler, builton our findings by analyzing Kauffman Firm Survey data and Kauffman Index of Entrepreneurial Activity—which uses data from the U.S. Census. He found that the average age of U.S. entrepreneurs is actuallyrising, with the highest rate of entrepreneurial activity shifting to the 55–64 age group.

Our research revealed that successful entrepreneurs typically start companies for three reasons:

— They have ideas for solving real-world problems.

— They want to build wealth before they retire.

8/3/2019 The Case For Old Entrepreneurs

http://slidepdf.com/reader/full/the-case-for-old-entrepreneurs 2/2

— They like the idea of being their own bosses.

The experience entrepreneurs have gained, the contacts they have made, networks they have formed, their ability to recruit good management teams and their education give them their greatest advantage. Youngadults fresh out of school don’t have these advantages.

Do people stop being creative as they reach middle age? Ben Franklin certainly didn’t. He invented thelightning rod when he was 44. He discovered electricity at 46. He helped draft the Declaration of Independence at 70, and he invented bifocals after that. Henry Ford introduced the Model T when he was

45. Sam Walton built Walmart in his mid-40s. Ray Kroc built McDonald’s in his early 50s. Some of the mostcreative people of the century were also not young. Ray Kurzweil published The Singularity Is Near in his50s; Alfred Hitchcock directed Vertigo when he was 59; Frank Lloyd Wright built his architecturalmasterpiece, Fallingwater, when he was 68. And let’s not forget the greatest innovator of recent times: SteveJobs. His most significant innovations—iMac, iTunes, iPod, iPhone, and iPad—came after he was 45.