“If you start me up I’ll never stop….” Great hook from the Stones in 1981 and mantra for many Boomers nearly 35 years later. No, we’re not talking about those little blue pills and twin bathtubs here. We’re talking “Silver Start-ups,” the phenomena of “encore entrepreneurs” who have decided that launching a start-up beats riding a golf cart. Overall, about 23 percent of new businesses in 2012 were launched by people age 55 to 64, according to the Kauffman Foundation, a private foundation supporting entrepreneurship. For now at least, women form the majority of these late-life entrepreneurs An article in BBC News online cites a 2010 report from Babson College that 10 percent of U.S. women age 55 to 64 “had taken steps to start their own business, compared with 7.5 percent of men.”
So, why the rush from retirement? Maybe for some women it’s the realization that they’ve hit the glass ceiling, and the thought that they could do better on their own. Or it could be a life-changing event that causes a re-assessment of priorities; a woman in the BBC piece decided to leave a lucrative career in marketing to explore more meaningful options after witnessing Twin Towers fall on September 11, 2001. For others—women and men—it’s the recession’s wipeout of their 401Ks, or the impact of a late-career layoff (so-called “jobless entrepreneurship”). Or it just might be a flash of inspiration, coupled with the realization that time is running out to fulfill that dream. Whatever the reason, there are a lot of “encore entrepreneurs” launching silver start-ups.
It all sounds great, and who doesn’t want to take a shot of doing something meaningful at this point in life, whether its commitment to a cause or bringing a business dream to reality? Here’s where a dose of reality is needed:
Failure is likely. The numbers vary but typically nearly 9 of 10 start-ups fail.
Capital is critical. The failure rate is higher for bootstrapped businesses than VC-backed—and three-quarters of those fail. And encore entrepreneurs who rely on their savings or credit cards to launch a business are playing a dangerous game with little time for “do overs.”
Ageism is real. This is especially true in the tech industry. Case in point: Vinod Khosla, a VC and former co-founder of Sun Microsystems, quoted on Inc.com, "…people under 35 are the people who make change happen. People over 45 basically die in terms of new ideas." Ouch.
Long hours are the norm. How many people of any age have the energy for a non-stop run of 80-hour+ weeks?
As an alternative to launching a full-blown business, many are taking the freelance or contract worker route. In fact, about one-third of U.S. workers today are “contingency workers.” It’s a bad deal for younger workers, although it’s often the only deal they’ve can find: there’s no job security, no benefits, no predictable income for contingency workers. But for an older adult who is drawing social security and has the benefit of Medicare, it’s not a bad option. There are tax consequences to be sure, but for a lot of older adults the satisfaction of continuing to be productive, the reward of a check, and the opportunity to overcome the social isolation that often accompanies retirement far outweigh any downside. And for the many who are helping elderly parents and “financially challenged” adult children, earning an income is a financial necessity.
As for me, a family history of longevity is a mixed blessing: no amount of scrimping will prevent my saving’s premature demise. But launch a start-up? Been there, done that, have no desire to do it again. Instead, I freelance. And even if I could, I sure wouldn’t want to quit. After all, life is short and like many of my silver-haired contemporaries, I have this rather foolish feeling that I just got started.
If you start me up
If you start me up I'll never stop*
*The Rolling Stones, first recorded 1975, released in 1981 on Tattoo You.