When is the right age to start a business?

According to a study by the Massachusetts Institute of Technology, the most successful entrepreneurs in the long term are those beyond the age of 40. This sounds plausible because, after all, at this age people have already gained professional and often management experience. Another question is in which age the start-up itself, i.e. the first step, is easier. Does it perhaps also have advantages if one tackles the matter young and naively?

One of my oldest friends, for example, asks himself whether he has perhaps waited too long with starting his own business.

My friend is in his forties. He has a great family - everyone is healthy. And together they live in a beautiful house with a garden near the old town of a highly livable small European city. And he is quite wealthy: He earns a lavish six-figure salary in the pharmaceutical industry - a secure job if ever there was one.

And yet. For years, he's been pondering and gnawing at the question: Was that it? Did he really have to admit to himself that he was "just" an employee after all? Shouldn't he have done his own thing long ago and founded a company?

It's not really about the money, because as I said - the latter is there. He has a deep-seated desire to create something lasting in his life, a need to live up to his potential - and perhaps to prove something to himself. Still, G. never really got around to his plan of owning his own business. And with each passing year, more difficult.

He simply has too much to lose. As he gets older, his lifestyle becomes more demanding: family, the house, all those obligations just don't mix well with the unpredictability of a startup.

The 25-year-old founder

I certainly didn't have that problem when I fumbled my way into self-employment at about 25 years old. I hadn't planned the move from a long way out. My self-employment simply resulted from my life circumstances: As a student, I wanted to earn some extra money without having to get up from my desk, and I also wanted to be able to manage my time freely.

Before I went to university, I had trained as a media designer. And as lackluster, tedious and boring as the whole thing seemed to me at the time, I had learned a few useful things along the way: I knew how to deal with customers. I knew how to carry out projects. And as a media designer, I had some tangible skills for which there were customers willing to pay. Even the smallest business needed a flyer, business cards and stationery from time to time. During my studies I learned how to program a website - with a database and everything. And with that, I was actually a fully-fledged one-man agency, and could get started. So I started looking around for jobs in my small network.

Working on my own account was fun, and it fit my lifestyle perfectly: I had to do some kind of project work all the time for my studies anyway. Freelancing was basically the same thing - just paid.

I sat in my tiny student apartment, ate canned ravioli, worked day and night, and was happy as a clam. I had few demands, no obligations, and all the time in the world.

An important side effect was that working with a lot of different clients always opened up new opportunities for me: There was always something going on everywhere, clients were planning something new, and I was along for the ride. And in the process, some important opportunities arose that quickly led to further improvement in my situation. With a simple student job in an office, I would have had only one iron in the fire.

At the end of my studies, the decision to start a business was simply the most economically sensible option: I was earning as much money freelancing as a sideline to my studies as I would have earned as a full-time employee. So why not make a real business out of it?

The 45-year-old founder

Such an effortless and low-risk path to self-employment is no longer open to my almost 45-year-old friend: His cost of living is simply already so high that a move from his salaried employment to self-employment would, of course, initially involve financial losses in the short term. And whether the business model works will only become clear much later - and then the well-paid position in the old company will be gone. How can you expect your family to take such a risk?

On the other hand, my buddy also has some badass advantages that my younger self at the time in any case didn't have - and which of course significantly improve the chances of a startup's success.

First, he has nearly twenty years of professional experience, more than half of it in management responsibility. During this time, he has built up a set of highly professional skills: He can sell and negotiate. He knows how to develop teams and inspire people. And he's absolutely not afraid to pick up the phone and pitch an idea.

Secondly, of course, he has already built up a financial cushion. In any case, he could easily afford to prefinance a prototype for a software product, for example, which he could then present to a circle of startup investors. Thirdly, of course, he has a wide network of professional contacts who could support him in his plan as door openers.

All in all, the situation for my friend doesn't look bad at all: The only remaining problem is the risk of losing his job. To get this under control, he would first have to develop his business as a side project. And here's the crux of the matter: A full-time job AND a successful start-up as a side project cost a lot of time - and that's naturally in absolute short supply for a father of three. In addition, at the age of 45, the energy level has naturally decreased somewhat. Working on a project all night long and then going back to the office the next day to perform just doesn't work out realistically.

My friend could develop the business plan on the weekend; the search for suitable implementation partners and other preparatory activities could also be done on the side. But for the actual launch of the company he would need his back free, i.e.: at least half a year of full time attention. The solution might be a sabbatical - at least if his employer goes along with the plan.

Summary

So who has the better cards for a startup? It's hard to say. The only fact is that the strategic starting situation of a 45-year-old founder is fundamentally different from that of a 25-year-old. In both cases, a start-up only has a chance if the founder realistically perceives his circumstances and takes them into account in his plans.

Recommendation for young founders

OK, you have no money, no contacts and you don't know exactly what you are doing. But you have two real trump cards in your hand: First, you have a lot of time - at least if you don't have a family to take care of yet. So you can focus all your attention on your business: You can give it your all, and work long, concentrated days to make sure that the box eventually flies. And because your demands and costs are low, your runway is very long. And if you realize after a few years that your business just doesn't work after all, not much will have been broken.

The prerequisite, of course, is that you start with a business model that is not very capital-intensive. A digital service, a software-as-a-service project, or any other activity for which you only need a desk and a laptop are ideal. Your bank advisor will turn up his nose at first if you stand in front of the door as an absolute nobody with an expensive business plan.

Recommendation for older founders

Your more demanding lifestyle, the care of your family, etc. limit your mobility for a foundation of course significantly. If you don't have a lot of money to spare, it would be extremely risky to give up your career for a start-up with uncertain prospects of success. A sabbatical could be the solution.

Especially if you decide to go this way, you don't have the time to feel your way into your market by trial and error, as the young founder might do. You only have one shot, and it has to be right. And for that you need a solid business plan, which then has to be implemented quickly and with discipline.

And this is exactly where you have the advantage again: As an older person, you simply know better how things work. You have professional experience, various professional skills and ideally already know your market well. In addition, you may have a network of valuable contacts that could quickly give your new business a decisive edge. And if you bring some money with you, your banker might even be convinced by a much more capital-intensive business, such as the implementation of a patent.

It is especially important that you create the necessary time in your life for this. A business needs attention. And if your family does not give you this time, it will be difficult.

By the way: Whether you are an experienced software entrepreneur or just starting your business, Leadtime is the perfect ERP solution for you. With its field-tested structures, processes, and scalable infrastructure, Leadtime provides a ready-to-use platform that empowers entrepreneurs to navigate the complexities of their business with ease. Whether you're just starting out or looking to streamline your operations, Leadtime is the ultimate tool to drive your success.