Baby Boomer Businesses are Booming

After a layoff, many people age 50 and older go into business for themselves

By SHARE

We like to think that most entrepreneurs are 20-somethings starting Web-based businesses in their garages. Although there are a few famous business titans who launched companies shortly after college or even dropped out, that is far from the norm. Americans between the ages of 55 and 64 have had a higher rate of entrepreneurial activity than those age 20 to 34 in every year between 1996 and 2007, according to a recent study by the Kauffman Foundation. Dane Stangler, a senior analyst at the Kauffman Foundation and author of the study, says baby boomer entrepreneurship is likely to continue throughout the current recession, both out of necessity after a layoff and because some baby boomers have always wanted to work for themselves.

These findings hold true even in high tech industries. Bill Gates and Steve Jobs, both of whom started young, are exceptions rather than the norm. Related research by Vivek Wadhwa, a Duke University professor who previously started two businesses and now studies entrepreneurs, found that twice as many U.S.-born tech entrepreneurs start ventures in their fifties as do those under age 25. The average age Americans start technology companies is 39, according to a survey of 652 chief executive officers and heads of product development who were born in the United States at 502 engineering and technology companies established between 1995 and 2005. “Once you are age 40 or 50 in the technology sector, chances are you are going to be laid off anyway or not rise any farther,” says Wadhwa. “Typically it happens about age 40 because that’s when you have a mid-life crisis and wake up and realize you could go through the rest of your time regretting not making it big.” Most of the technology company founders were also well-educated, the survey found. Almost all of the tech entrepreneurs held bachelor’s degrees (92 percent), and some had earned master’s degrees (31 percent), or completed PhDs (10 percent). About half of the degrees were in science, technology, engineering, or mathematics.

For more information, see:

  • 10 Great Places for Entrepreneurs to Retire
  • 6 Tips for Starting a Business After Age 50 
  • Slideshow: Great Places for Entrepreneurs to Retire