The 20-year-old entrepreneur is a myth, according to study
phys.orgPrevious discussions about this study:
https://news.ycombinator.com/item?id=16794228 (241 points, 13 days ago)
https://news.ycombinator.com/item?id=16808737 (93 points, 12 days ago)
https://news.ycombinator.com/item?id=16901184 (29 points, 7 hours ago)
I don't see the raw data of the study but I can think of one reason why it contradicts the public perception of the 20-something founder: There's a difference between B2B/SaaS/enterprise startups vs B2C startups.
The B2B companies are often started by older folks in their 30s and 40s. (E.g. PeopleSoft human resources software started by David Duffield age 46 and Siebel CRM software started by Tom Siebel age 41. Both were acquired by Oracle.) Their accumulated years in the industry gives them the relationships to convert into their first enterprise customers. Even more fundamentally, a B2B startup solves a "paint point" for corporate customers. Therefore, it makes sense that the founders would have spent many years working for companies (as employees in their 20s and 30s) to intimately understand how to solve their problem. Being a 40-something founder is the natural timeline for all that to happen.
However, many prominent B2C companies are started by 20-somethings (e.g. Google (age 25), Facebook (age 19), Snapchat (age 21), Instagram (age 27). The top-100 consumer-facing iOS & Android apps on their app stores are probably done by younger founders. It's hard to think of consumer-facing internet companies that were started by 40-somethings. (Netscape in 1995 with 50-year-old Jim Clark would be an uncommon example.) The B2C world doesn't require existing industry relationships; it's the viral spread of software to create network effects rather than a 6-month sales cycle of B2B.
It's the B2C companies that get more coverage on WSJ, Bloomberg news, and even tech sites like HN. Readers will click on more stories with "Snapchat" (B2C) in the title rather than "Palantir" (B2B). Therefore, it seems like the startup world is skewed towards 20-somethings.
If I was going to sum-up this comment, it'd be something like "Sell what you know."
The viral growth of companies started by 20-something founders is fueled by 20-something consumers.
The growth of companies started by 40-something founders is fueled by businesses with 40-something managers/executives.
Hm... Women make most of purchase decisions in households but founders are mostly men. Something does not match up.
Yes looking at the raw data would be interesting. My hunch is that that there are many more 20 year olds starting companies (and going for moon shots). The opportunity costs are much lower when you are younger. The success rates might be higher in the older group but the younger group just by virtue of a larger sample (and going for moon-shots) might be why you see these outliers of multi-billion dollar public companies founded by 20 somethings
> Netscape in 1995 with 50-year-old Jim Clark would be an uncommon example
Don't forget 23-year-old Marc Andreessen as a cofounder.
This is a really interesting trend! Thanks for pointing it out.
At 20, I had maybe 2% of the skills and knowledge that I’d need to be a successful entrepreneur. In my mid 30s, I maybe have 30%. I’d say it takes more luck the younger you are, and the 40s-50s is when talent and experience can make a huge difference in success... since you actually might have those two attributes by then!
I would agree with this. I've been trying to start companies since I was 12 years old and now that I'm in my late 30s, I've finally hit on a success. It took a lot of tries and failures to figure it out.
Perhaps you could say that when you're young, there's a higher chance you'll fail due to internal reasons, but a higher chance you'll start due to external reasons (ie. very few commitments).
As you get older, there's a lower chance you'll fail due to internal reasons, but a lower chance you'll start (eg. less risk-seeking, less geographically mobile, family commitments, debt, etc.).
By this logic then, I'd expect VCs would jump at the opportunity to work with older, more experienced entrepreneurs who happen to be free from those commitments.
Older people are also more lenient towards your mistakes at a younger age. More people give you a chance. And celebrate even the tiniest successes.
I would say the younger you are, the better your ability to acquire entrepreneurial spirit, but the less knowledge you have to execute. The older you are, the more knowledgeable you are at executing yet the more shy you become at dreaming big.
This makes me recall the phrase: An entrepreneur needs the right balance of genius and craziness.
I also suspect I'll be a lot less salty about not having any time to sit down and program myself any more because I have to deal with all the business parts.
Studies like this often ignore the power law. Consider the most valuable tech companies:
1. Apple: $570.7B.
- Jobs: 21
- Wozniak: 26
- Larry & Sergey: 25ish
- Gates: 19ish
- Allen: 22ish
- Bezos: 30ish
- Zuckerberg: 19
Jobs basically reinvented Apple when he came back. The "power law" company that you're talking about was created by a person in his 40s. Before that it was a has-been that had to be bailed out by its biggest competitor.
Leaving that aside, can give any more detail as to why you think power law companies matter and "average" companies don't? There's a lot of "average" companies out there that are making tidy profits for lots of folks.
Salesforce, LinkedIn, SpaceX, Tesla, heck Intel... I suspect the conclusions one draws from "power law companies" will depend on which companies one includes for consideration.
> What matters are the power law companies, not the average company.
Depends on your viewpoint. Average company can be pretty good for most personal goals that most people have.
Uber- 30 years- Travis Kalanick Twiter- 30 years -Jack Dorsey. So i guess 30 is upper limit.
Agreed.
Unfortunately, delusions of grandeur and a unicorn VC culture convince average young people into believing themselves to be power law founders with power law ideas. Thankfully that has changed a bit and it looks like the miracle men are moving into blockchain. In reality, billion dollar+ ideas are rare, and clever, delusional, and young people are a great fit for the helm.
When you're older, you have domain knowledge, leadership experience, and want to take linear risks, not "sacrifice one of the remaining chapters in my life for that chance".
“Nothing defines humans better than their willingness to do irrational things in the pursuit of phenomenally unlikely payoffs. This is the principle behind lotteries, dating, and religion.” (Scott Adams)
Nothing more true than that. Except I'll add that people become a bit more disillusioned by experience and willingness to take risk as they get older - at least maybe with dating and startups, maybe not lotteries and religion
i always enjoy reading these articles, because others like myself who have had their startups acquired at a young age are beating the stigma.
but i feel as though in this day of age there’s so many “companies” who claim to be “startups.” sure, they may have the experience, just not the capital.. and with that it completely changes everything.
anyways i’m 21 and had a “startup” (an app) acquired at 18. now back in school, i can understand the articles perspective. i’m only 21 and i feel like i only really have 10% of the knowledge, compared to someone who is 40 and who has so much more experience then me.
I started doing freelance work when I was about 24, and didn't really start my company until 26. But now that I am in my early 40s, I feel a lot more confidence and patience. But I can say that if I hadn't worked on my own business during those years, I wouldn't have the experience I have now with people, my area of expertise and business in general.
But I do wish I had had some experience working at a larger corporation though, but I feel that it would have made me complacent, and it would have been harder to justify being "poor" to build my own company. Absolutely worth it though. I hope you keep going and do well.
I'm in my late 30s now, and the biggest impediments to starting a business are family/financial obligations and the fact that nobody is going to fund a ~40 year old first-time entrepreneur.
So the only option is to work nights/weekends on an MVP (the slow way) while holding down a full-time job, and hope you can get enough traction on your own to attract attention/investment/etc. --> I'm finding this last bit extremely difficult. Doing dev/product work as a moonlighter is perfectly reasonable (though not necessarily fun after a hard day's work), I can sit up in bed with my laptop and hack on code until I fall asleep... but add sales and marketing on top of that and there simply isn't enough time to do things right (not to mention, you really need to be selling during standard business hours -- except you can't because you're at your day job).
I'd suggest finding a co-founder. This can be difficult depending on where you live. Go to a meetup and talk about your idea. Find someone who gets jazzed about it and ask them to come on board. Give them some tasks to do to prove they're serious. When they disappear and don't do them, go back to solo founding satisfied you wasted your time on comment advice from an anonymous stranger on HN.
Personally I think the ideas you have when you are 20 and the ideas you have when you are 40 are probably going to differ a lot. Since starting a business is about doing something in the real world that is going to make money I am not surprised to see that there is more older entrepreneurs than one might expect.
The ideas you have when you are 20 are often more idealist and not necessarily connected to reality as much as the ideas of a 40-year-old. This is coming from a guy that has some years to go before 30.
I'm 44. Ideas are a dime a dozen (if you can come up with them). The hardest part is the implementation and having necessary capital.
Comparing today to the mid 90s when I was doing my first college startup, capital is relatively easy to come by and the expenses for setting up servers/hosting are pennies on the dollar.
My issue in my 20s was not knowing how to get into businesses and provide them tools they needed. I also ignored all the .com boom type stuff because I was (sadly) too grounded in revenue.
Most ideas aren't unique, novel, or even new. It's how you deliver and the service/services you provide. If you're benefiting people in some way, they'll come running.
Amen to this. And even if an idea is unique, novel, or new, it can immediately be copied by just about anyone, so there's typically not a lot of enduring competitive advantage in just an idea.
I'm in my 40s and have started a handful of successful companies and from what I've seen at least, the miracle 20-something entrepreneur is close to a myth. Obviously there are exceptional cases, but it often takes a couple of decades of learning (and failing) to figure out how to create and grow a successful business.
Part of it is because there are many different stages of growing a business, and each one has unique challenges. You go from "we built something sellable!" to "we have paying customers!" to "we are self-sufficient!" to "we are expanding our market share!" to "we are trying not to slow our innovation!" to "we are under attack from the competition!" and so on.
A pretty solid idea + excellent execution + real business model = really good odds of success.
Execute, execute, execute!
So what we get is a very big case of survivorship bias. Relevant: https://xkcd.com/1827/
could you explain how it factors in this case? because I don't think that it does.
there may be some 'selection bias', by only including start ups that went on to hire at least one employee, but I am OK with their operational definitions in this case.
the story makes sense, and it jives with my observations when doing my masters in computer science. In tech in particular, most of my classmates were not entrepreneurial at all. Even if they were, the class curriculum was so hard that nobody had time to work on side projects. the undergrads, not only didnt have the technical skills, but they also didnt have any business sense either.
One of them lamented they hate business people who sell products but dont understand it through and through. I told them I would rather have a business guy who can sell any product, than an engineer who can make a great product but not sell it. they still didnt get it.
For the most part, a person only gets invited to give a speech if they are one of the lucky few for whom things went well. If your situation is more ordinary, and you've failed, then you not invited to speak. Because of this, we (the public) end up with a distorted view of things. Success seems more common than it is, because we only hear from the successful. That is survivorship bias. It's also why I've argued we need more honest stories about projects that fail:
https://www.amazon.com/Destroy-Tech-Startup-Easy-Steps/dp/09...
I think they meant that the myth has been caused by selection bias, not that the study is prone to it.
I started my first "company" at 12.
I've done 8 "real" startups since college. It's probably because I come from a family of entrepreneurs.
Capital is the key, experience is secondary. It costs more to learn on the fly but you'll try things you probably wouldn't otherwise.
My biggest downfall over the years (IMO) is never believing in the "it will be ad/views supported" belief my friends had in the 90s. Having a background in entrepreneurship with degrees in Finance and Econ (+ MIS) made me focus a lot more on actual cashflow. C'est la vie!