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Yeah, Cause Mark Zuckerberg Is the *Only* One

This is wrong. Not in the moralistic kinda way, but there's no way this methodology is good. From the Ewing Marion Kauffman Foundation:

Based on a study taken of U.S. entrepreneurs, who founded their companies between 1995-2005, it found the median age of U.S. born founders was 39 years-old, with only 1 percent

launching their company as teen-agers

. And for those in their 50s, there's still hope - twice as many folks in this age group founded a tech company than those in their early 20s, according to the study.

At the very least, I'm betting if you looked at the numbers year-over-year from 1995 to 2005 the age gets younger, then older and then far younger in the early 2000s. I'd further wager that the age is younger now than in 1999, since the first dot com bubble relied so much on raising money and business development wonks.

It is just so easy to start a company now. You pretty much need about $100 and an Internet connection. And the $100 is really for pizza and beer. I constantly hear from teens and 20-somethings starting companies and I write for BusinessWeek! A publication that skews very old. I realize I live in the Silicon Valley echo-chamber, but every time I travel anywhere in the world I meet kids inspired by Evan Williams, Mark Zuckerberg and Kevin Rose doing their own thing. You know what happens when dreams meet jaw-dropping-low barriers to entry? A surge of entrepreneurs.

The Kaufman Foundation generally focuses on what I'll call "grown up" entrepreneurs, so I think their sample size probably skews older. Not that it's necessarily their fault. This is an incredibly hard thing to measure and I'm sure it was a valiant effort. Even in the business press we tend to think of entrepreneurs as Valley guys raising venture money, forgetting it's really much broader in a Web world.

Entrepreneur doesn't have to equal "Start-up" in the Valley sense of the word. Between open source, Web 2.0 and even blogs, it has become de rigeur to make money online in your teens and early 20s. In fact, most well-known Web entrepreneurs started businesses when they were teenagers or in college, they just weren't the ones that made their names and fortunes. Did you know PayPal was Max Levchin's fourth company? (Maybe third...going from memory but it's all in the book if you want the gory deets!) When he was a newly-immigrated 16-year-old Ukrainian he was making extra money cracking game codes for Chicago's organized crime syndicates. Not something you'd raise venture money for, but I'd call it entrepreneurial! 

Ok, they're not all the next Facebook. (Are the companies being started by 50-year-olds?) But somewhere among these kids are the next Marc Andreesseen or Bill Gates. It seems to me a study on them would be far more interesting and tell us a lot more about where tech entrepreneurship is going.

Comments

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I agree that the truth is probably younger.

One of the things that makes the study so difficult is that the line between "entrepreneur" and "guy with website" is blurred.

More young kids (than old people) probably have websites (web services, etc) that will eventually turn into Facebooks. Because it's fun & easy.

But more old people probably start out with "business" in mind.

Thoughts?

What separates the wantrepreneurs from the early 20-somethings that make it is simple: access to capital. Zuckerberg had Sean Parker who had Peter Thiel. And the rest is history.

Not sure if you're following WeGame.com, but their founder (Jared Kim) started it when he was 19. He turned 20 a few months ago, but he's raised around 3.5M. He's got more access to capital than most people that have been in the valley for years though -- his brother in law is Jason Calacanis and sister is Joyce Kim (co-host of GigaOm show).

Sure, the barrier to entry is a lot lower now, but only in the sense of launching your web application. The ones that "go viral" are few and very far between, but the ones that make it usually have founders with access to capital from the start/very early on.

My $0.02

On a side note -- saw your husband on 3rd street about an hour ago :)

I agree the line is fuzzy. but disagree that it's access to capital. that would mean a rich kid is more of an entrepreneur than a poor kid. it is just an easier way to draw the line since it's tangible. but was mark less of an entrepreneur before he met peter thiel? i don't think so. I consider "wantrapreneurs" posers who act like they're starting something but really just want to go to parties and be in the scene. some of those guys could very well have access to cash!

Thanks for the comments both of you! and if anyone else sees my husband on 3rd street- hug him! his fourth macbook just died!

i guess my line-- if i had to draw one-- would be bringing in revenue. that's technically a business, and you're technically an entrepreneur, no? seems a better distinction than investors. no?

I guess it says something about each person that *has* access to capital -- they are good entrepreneurs without any money, so I can agree with you on that.

If bringing in revenue makes you an entrepreneur... Oh man, I don't know too many entrepreneurs I guess.

:D

Also, you got to get rid of this captcha after you make a comment!

@sam: ha ha. come on! google ads are insta-revenues!!

it's an homage to max!! you know paypal was one of the first commercial uses of captcha!

I think your perspective on the age of 'entrepreneurs' is skewed by your experience in Silicon Valley. You need to apply a broader definition of "entrepreneur."

In my experience as an attorney working with entrepreneurs in the hinterlands (North Carolina), a lot of folks start businesses as second careers. And a lot of entrepreneurs in "biotechnology" are spinning it out of a successful career in academia. It seems likely that younger entrepreneurial types are drawn to IT and Silicon Valley because of the glamorous way the "entrepreneurial lifestyle" there is depicted. Youth and energy do help in dealing with that grueling sort of startup existence out there.

There /is/ entrepreneurship outside of California. Y'all come visit and see for yourself!

hey thomas-

thanks for the comment. very possible, although in my case i'm drawing this opinion from conversations and meeting people across the US and around the world MORE so than the valley. i think the average age is actually older in the valley because there are so many "serial" entrepreneurs. my sense is a valley focus if anything skewed the kaufman study.

i also think there are probably more web startups than in areas like biotech where more capital/specific expertise is required. so that's part of why i'm figuring the number is larger.

just to take a *little* issue with your last line, if you keep reading my blog you'll see that i actually spent most of april talking to entrepreneurs OUTSIDE the valley so i do get out of the echo-chamber a good deal. and i'm a southern girl!! ;) but i agree we do tend to think we're the center of the universe here. i hope people like you keep commenting so i get a broader perspective!!

My Master's thesis was on entrepreneurship. I live in Ann Arbor, MI where the SPARK organization actively works to grow tech companies. Sometimes I attend the meetings, and I can say that most of the entrepreneurs are either PhD/post-doc students (mid-30s) or their advising faculty (mid-50s). Also, my surface read on the Kaufman study suggests to me that they're looking at individuals who are seeking funding. Older entrepreneurs have more knowledge of VC money and seek it more often, whereas teen/20s entrepreneurs are more likely to be boot-strapping, unnoticed, from their basement. So part of it, I think, is your location in the SV echo chamber; but also I believe it's a sampling error in the study.

Ha ha. This is just hilarious. The problem is that if you are actually an older founder of a company in the silicon valley echo chamber, then you get pushed out to sea on a raft because you don't fit the image.

I should know.

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