Too Old to Be an Entrepreneur? Think Again | Ep 178

Want to grow your business? Download your free roadmap today: coltivar.com/growth

Most people think entrepreneurship is a young person’s game. But the data says otherwise. In this episode, Steve breaks down why your 30s, 40s, and even 50s might be the best time to launch or buy a business—and how real-world experience gives you a massive edge over the typical startup founder. 

He also unpacks some of the biggest myths around age and entrepreneurship, shares what he's seen from founders who started later and built real wealth, and offers a perspective that might change how you think about your next chapter. If you’ve ever wondered, “Am I too old to start a business?”—this one’s for you. 

Disclaimer:   
BYFIQ, LLC is a wholly owned entity of Coltivar Group, LLC. The views expressed here are those of the individual Coltivar Group, LLC (“Coltivar”) personnel quoted and are not the views of Coltivar or its affiliates. Certain information contained in here has been obtained from third-party sources. While taken from sources believed to be reliable, Coltivar has not independently verified such information and makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. 

This content is provided for informational purposes only, and should not be relied upon as legal, business, investment, or tax advice. You should consult your own advisers as to those matters. References to any securities or digital assets are for illustrative purposes only, and do not constitute an investment recommendation or offer to provide investment advisory services. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendations. The Company is not affiliated with, nor does it receive compensation from, any specific security. Please see https://www.byfiq.com/terms-and-privacy-policy for additional important information. 

LinkedIn | YouTube

coltivar.com/byfiq

Transcript

If you're over 35 years old, and you've always dreamed of being an entrepreneur, but you haven't started that business yet, is it too late for you? Or if you do end up starting a business, is it better to begin from scratch or buy an existing company? Those are two questions that I'm gonna answer today, and they come from a 39-year-old woman in the community who recently reached out to me. And by the way, I'd love to hear from you. You can always connect on LinkedIn and send me a DM. And if you have an idea like this, I'll either turn it into an episode or I'll just respond to you directly. But regardless, I love hearing from you, so don't be afraid to reach out.

Let's go ahead and jump in. Here's this 39-year-old woman, and she feels like she might be getting too old to start a business. Early on in her life, she wanted to start that business, but because of her family situation and cultural expectations, she never got around to it. And I felt like this early on, so that's what I'm gonna start with, is a little story from my life, and then I'm gonna bring in the research so it's not just Steve talking and sharing his opinion. So I wanna bring the facts into the conversation.

When I was in my late 30s, I remember talking with my brother one day, and I was feeling a little discouraged because here I was getting older by the year, and I still hadn't grown this giant business that I wanted to build. And he was talking to me, and he's like, Steve, look, the founder of my business right now, and he was working for a real estate investment company at the time, and it was nearing a billion dollars in valuation, he said he started around 60 years old. And I was like, oh, interesting, okay. I thought most entrepreneurs and successful entrepreneurs were people in their 20s. And I think that's the idea that's floating around out there because Silicon Valley favors typically younger founders.

And if you think about it, the whole idea of being a 20-year-old, sleeping on a couch, and coding until two in the morning when you don't have kids and you can eat potato chips and you can live that life seems overly romanticized out there. So I wanna break down some of these misconceptions out there by bringing in the facts and provide encouragement to you if you're thinking about starting a business, but maybe you're in your 30s or 40s or even beyond.

Okay, so check this out. This is from research from Harvard and MIT. The average founder age at startups across all industries is 42 years old. Crazy, right? You would think by what you see on Shark Tank, in the news, in CrunchBase or whatever, like in Silicon Valley in general, you would think that everybody starting companies is in their 20s and 30s and everybody else are just stuck in corporate dead-end jobs, but that's not the truth, right? For high-tech sectors in VC-backed companies, the average founder is in fact 42 to 45 years old. The fastest growing startups, the average founder age is 45 years old and founders of companies with successful IPOs and acquisitions, the average age is mid-40s. Bam, right there. There's the research. There's the facts.

So let's talk about first-time founders and serial founders, okay? So people who start a business for the first time and serial founders, those who are starting businesses one after another, okay? 60% of unicorn founders were first-time founders. So if you don't have a lot of experience, you can still start a business and be very successful. 40% had founded at least one previous company. So this is coming from Stanford and CrunchBase Research.

So let me just talk about this for a second. A lot of you, when you start a business, you're gonna start a business and it's probably gonna suck. Hashtag real talk here. You'll come up with a cute logo, you'll create a website, you'll have your name, and then you go out there and then you realize early on, it's really hard to get customers. And if you do get customers, it's really difficult to keep your cost in check so you can actually earn a profit. And if you do have profit, you also have to pay attention to your working capital and your capital investments so you have free cashflow. And that's why the majority of businesses fail. It's really hard to start a business.

So I can tell you the first business I started, I was 16 years old. I started it out of my sister's garage. It was a landscape business. I started by going around and doing sprinkler repairs for homeowners and then it grew into doing landscape projects and then in my early 20s is a multimillion dollar business. But I could tell you, I didn't have business experience when I started. I had very little capital. I had hardly any financial literacy. It's like super embarrassing to admit this. I couldn't even read a financial statement. I was just relying on sheer grit and heroics to make it work and I left so much money on the table. I think back now and I'm like, oh my gosh. That's why I'm so passionate about this topic, financial literacy and strategy and teaching people how to understand the numbers and how money actually works.

What I want you to get out of that is my first business, even though I was lucky enough to build it into award-winning company, I made a ton of mistakes. And then I've started other ventures that were complete failures. So I learned from those failures and I applied those lessons to build Coltivar into what it is today. But without those experiences, I wouldn't have been able to piggyback on what I was learning to build better companies. And now I'm fortunate enough to work with a ton of companies and see operating models and see how customer acquisition models work across multiple industries and businesses. But without that, it would be a lot more difficult to start a business.

So if you've started a business and it failed and you want to just give up and not start another business, don't give up on yourself that easy. Maybe those learnings will come back around. I remember years ago, listening to this episode on how I built this. It was a good podcast. I haven't listened to it in a long time, but it was on the founders of Slack. And I may totally mess up these details, okay? But it generally went like this. The founders of Slack, they started out as a video game company. They were trying to create a video game and they blew through all their money and they ended up laying off all their employees because they're out of cash.

And after they did this, somebody reached out or one of their friends reached out. I can't remember the specifics, but essentially they said, you know that internal communication tool that you add to message each other? Like, how can I get that for my company? And hence Slack was born. It was born out of a video game company that failed. So you can always build on your successes later on.

Okay, so I just wanted to point that out.

Let's go back to the facts here and let's talk about unicorn companies because this is really interesting. A unicorn company is a business that grows to a valuation of a billion dollars or more. The average age of a unicorn startup is actually younger than the average age across all industries. It's 35 years old. The median age, in fact, is 33 years old, according to Stanford.

The most common founder age bracket of a unicorn company is between 30 and 39. And founders under 20 years old, they make up about 25% of the population with unicorn companies. So 75% of founders are older than in their 20s. So that's really important to understand. And founders over 70 years old, they still exist, but they make up about 1% of the population when it comes to unicorn companies.

All right, so here are a few other things to point out. In biotech, energy, and industrials, founders tend to skew older between 45 and 50 years old because of the requirement of industry experience and deep technical expertise. Which brings me to my next point. According to Harvard and MIT, founders with 10 plus years of relevant industry experience were 125% more likely to succeed than peers without industry experience.

So I think age can be a huge advantage instead of a disadvantage because if you could go into an industry and gain experience working with customers, seeing what works, seeing what doesn't work, and then you could take that knowledge and apply it to your startup or apply it to a business you acquire, you will be so much more successful. Because think about it. Entrepreneurship comes down to one thing, solving problems better than anybody else for a specific customer.

And how are you gonna know what those problems are if you don't have firsthand experience? Sure, you could use chat GBT and ask, what are the problems in this industry or with this person or that person? But until you live it and until you experience that pain yourself, you're gonna struggle to build a company and products and services that can really solve that pain point. Because you won't know all the nuances and all the complexity around solving for that problem. And that's why venture capitalists oftentimes will ask you, have you experienced the problem you're solving for?

Okay, because that's super critical. Let's just say that my sister was deaf. She's not, but let's just say she was deaf. And I grew up with that. And I wanted to start a business that helped people with a hearing impairment. I would have firsthand experience working with my sister. Better yet, if my sister started the company, it would probably be even more successful because she experiences the pain every single day. So that's why it's so critical to have that experience and that expertise. And it could be an advantage and it comes with time.

So maybe in your twenties, the best idea is not to drop out of college, live in your mom's basement and try to start that business that you have no experience with, right? Maybe the answer is getting out there and working for a little bit. So don't be afraid to do that. I'm not saying you have to have experience. I'm just saying that according to the research here, you're gonna be 125% more likely to succeed if you have 10 plus years, okay?

Here are some other key takeaways that I wanna share with you. Middle age is the norm, not the exception. So for the woman who reached out to me, like I said, I'm gonna keep her name confidential and protect her privacy. But I'm speaking to you, you got this. You're good, sister. Go out there, start the business. Don't be afraid of what other people think.

I know you mentioned this idea of cultural expectations and I don't know the nuances and the details of that. But I could tell you, oftentimes people are insecure with themselves or they don't want us to get ahead. So they're gonna hold us back. They're gonna come up with all the reasons why we shouldn't start the business or why this or that's not gonna work. But we have to do what's best for us because I would rather go out there and fail and say, I failed, but at least I tried, than be on my deathbed one day and look back and think, dang it, I should have started that business, but I didn't.

The next thing I wanna point out is you don't have to be young to win. Only 25% I remember of Unicorn founders were in their 20s. The rest were in their 30s and 40s and 50s and beyond. So you don't have to be in your 20s sleeping on your friend's couch to start a business. You could be 40 years old, a mom, a single mom, working at nights to launch your business. And that's the beautiful thing about the world we live in right now.

You can go out there and start a business with very little capital. You can freelance and you could turn that freelance job into an actual company. And there are so many opportunities to do things and to start a business today. I think the excuses that you have to rely on are fewer than the reasons why you shouldn't start a business, okay?

The next thing that I wanna drive home is experience is an asset. So a lot of people come to me, they come to the platform BYFIQ, Boosting Your Financial IQ, to learn finance, which is so critical. If you don't understand the story behind the numbers and you go out there and run your business, sure, maybe you could be successful, but you're gonna be so much more successful if you build these skills.

But building these skills takes work. It requires sacrifice. You may have to put away Netflix for a little bit, put your phone down and grind through the case studies, through the work so you could learn skills. So experience is critical.

I know it's really sexy and it's very romantic to think you could just drop out of school, start that business, have a million followers and a million users one day and you grow this business and you exit at a billion dollars. I know that sounds really cool, but it's really hard. So experience is a major asset. I want you to remember that.

First time founders, they often succeed. So you don't have to have experience running a business before you start a business. But if you do start a business and you fail and you apply those learnings moving forward, you can build a really successful company.

All right, peak success happens later than you think. According to the research, the average success rate of a successful entrepreneur is 45 years old. So I always like to say in your 20s you learn, in your 30s you earn, and in your 40s you start applying all this stuff to build real wealth.

The next thing is there's no expiration date. It doesn't matter how old you are. You can start a business when you're 80 years old. And I know it's 1% of founders of unicorns are 70 years old or greater, but maybe you don't wanna start a billion dollar company. You could be an 80 year old and you could start a business, all right? So there's no expiration date to entrepreneurship.

And then just remember Silicon Valley bias for younger founders doesn't translate across the world. There's so many successful business owners who start in their 30s or 40s, and you don't have to start a sexy tech company or AI business. You can start a plumbing business or a landscape company or electrical business, or you can have some type of website or e-learning platform. There's so many different things you could do out there. The opportunities are endless.

Okay, that's entrepreneurship from scratch. What about entrepreneurship through acquisition?

I think this is a huge opportunity for you out there. If you're working in a job, it may be really risky to just give up a paycheck and go start a business and pray that it works out. Especially when you have a spouse or a partner and kids, that could be really risky to be honest. But you can still do it.

I wouldn’t shy away from that. I did it. I started Coltivar when I was married, when I had a kid, when I was working in public accounting. I put money aside and then I just left one day and I just never looked back. So it worked out, but it doesn’t always work out.

You can also acquire a business. Doesn’t mean that acquiring a business is always gonna work out, but here’s the advantage. You’re buying a business with existing customers. And if you’ve ever started a business, you know how hard it is to get customers. That’s a huge part of the battle.

So you’re buying into a business with existing customers, with a proven model, because I’m only gonna buy a business with three years of profitability. I’m not looking to buy a business with a lot of losses. Now I could go in and I could turn around a business, but that’s an entirely different skillset and it’s very risky. You could do that, but at your own peril.

I’d look for businesses with profitability. And here’s the beautiful part. There are so many owners out there that want to exit their business, but their kids don’t want to have anything to do with it. Or maybe they can’t exit their business for a variety of reasons. And they’re looking for a smooth transition and you could take over their business.

So many owners, they don’t want to sell their companies to private equity because they want to protect their legacy, right? So there are opportunities to get creative with the financing. And even if you have zero dollars, you can still buy into a business. And I think it’s an excellent opportunity, but you have to know how to build a business. You have to know how to run a business, right?

So I’m super passionate about this. And here’s how you create real wealth. There are two levers. Number one, you have profit. And you have the valuation multiple.

So think about it like this. You buy a company, they’re doing a million dollars in profit. They have a 3x multiple on that profit. So the company’s $3 million. You buy it.

Within three to five years, you increase the profit to $2 million from $1 million. And then you increase the valuation multiple because now the business is bigger. Maybe you eliminated key man risk, systems risk, single channel risk, other risk factors that were dragging down the multiple.

Nonetheless, you make the business more attractive. And let’s say you grew it from a 3x multiple to a 5x multiple. And like I said, profit went from 1 to 2. Now, instead of being worth $3 million—1 million times a 3x multiple—it’s now worth $10 million: 2 million in profit times a 5x multiple.

That’s crazy. $7 million in three to five years. So that’s the upside of entrepreneurship through acquisition.

A lot of startups, they fail. And a lot of startups, they never reach profitability. I’m not saying the startup path is bad. I’m just giving you another option to do entrepreneurship, but through acquisition.

Like I said, you have to know though how money works and how business works. So getting experience in the field that you want to acquire a business in is really critical. And understanding how money flows in a business—please don’t buy a business if you don’t know how money works.

At BYFIQ, which is BoostingYourFinancialIQ.com, you can go to byfiq.com. I’m doing these lessons. I call them the Lesson of the Week. They’ll be on the website for two weeks and you have access to them.

And the cool thing about these lessons, unlike the free Financial Pro Program—which I think is amazing—that program has over 100 video lessons where you learn the fundamentals. In the weekly lessons, you get to learn from case studies.

So I’ll walk you through a company and their financials and the tools that I use to evaluate businesses and to build them and then eventually exit them. And all these resources are available at byfiq.com. So be sure to check out the Lesson of the Week.

And until next time, take care of yourself. Cheers.