Why Baby Boomers Can Be Great Entrepreneurs
Increasingly, this generation is dipping its collective toes into the entrepreneurial waters.
After her 11-year tenure with Lehman Brothers ended, and with few employment options, Gray, 64, took steps the following year to start Campus Scout, a New York-based college recruiting service for employers.
"I think to some extent, I had no choice," she says of the move to start her own business. "I'm not one who sits around much."
Gray's case speaks to a growing trend among baby boomers of taking on the title of entrepreneur.
While overall entrepreneurship in the U.S. is down, there has been an increase among boomers. A report earlier this year from the Ewing Marion Kauffman Foundation, an organization that studies entrepreneurship, found that adults ages 55 to 64 comprised 23.4 percent of all U.S. entrepreneurs in 2012, compared to 14.3 percent in 1996, a larger growth rate than any other age group.
The increase is partially due to financial need. While the U.S. unemployment rate among boomers was significantly lower (4.9 percent) than the national average (7 percent) in November, boomers suffered financially during the Great Recession, losing 25 to 28 percent of their median net worth, according to a 2013 study by Pew Charitable Trusts. The majority of people retiring today "do not have the financial means to underwrite 20 to 30 years of their lives," says Elizabeth Isele, co-founder of Senior Entrepreneurship Works, a nonprofit that helps seniors age 50 and older start businesses. But others, who may be in better financial shape, are becoming their own boss to pursue an occupational dream years in the making, she notes.
For baby boomers on the fence about starting a business or pursuing an entrepreneurial idea, here are some reasons you can excel.
Willing to take on risk. Starting a business has its share of potential landmines, such as selling a product that struggles to attract customers. But baby boomers have a penchant for risk-taking when it comes to their current jobs. According to a survey released in February by job search engine Monster.com and Millennial Branding, a Generation Y research and consulting firm, 43 percent of boomers identified with being high-risk, compared to 40 percent of Generation X and only 28 percent of Generation Y who felt the same way.
As Isele explains, baby boomers who took risks in their careers are more adept at assessing their risks. But there's also an element of fatalism. "There is an end in sight to their life. And they figure, 'If I don't risk this now, I will never have this opportunity again,'" Isele says.
Applicable work experience. After being laid off from the national design firm DLR Group in 2002, Delena Stout, 56, started her own business the following year, Brookside Barkery & Bath. Over the course of a decade, the Kansas City-based dog bath and all-natural pet food store has expanded to multiple locations, gained more than 25,000 customers and generated millions of dollars in profits.
But it was Stout's past work life, which included time in retail, accounting and business development, that proved critical in her later success as a business owner. "Every job that I've had brought me to the point of where I am today," she says.
Motivated to avoid boredom. Only 14 percent of baby boomers say retirement is a time to "retire and enjoy a well-deserved rest, take it easy, pursue leisure activities and take care of myself," according to a 2011 report from encore.org, a nonprofit that focuses on baby boomers.
"Some people retire and find that they're bored to death, and they want to stay active and mentally engaged," says Mary Beth Izard, author of "BoomerPreneurs: How Boomers Can Start Their Own Business, Make Money and Enjoy Life" and founder of Acheve Consulting, an organization that works with aspiring entrepreneurs. From lining up financing to marketing a product, you'll have more than enough work to consume your time and keep boredom at bay.
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