For young entrepreneurs, age poses challenges, presents opportunities | Business
ANDERSON – At a recent retirement, some of Steve Thompson’s colleagues on the Metropolitan Indianapolis Board of Realtors board were stunned to find he was younger than many initially thought.
“Half the board had no idea I was the youngest in the room,” said Thompson, owner of FC Tucker / Thompson Realtors in downtown Anderson. “Unfortunately my hairline makes me look older than I actually am. It was a shock to them when they realized I was only 35 years old.
While the incident made Thompson laugh, it also reminded him that in the real estate world, as in many other industries, youth – whether perceived or real – can affect a business’s success. For the best or for the worst.
“Whether people can help him or not things change a bit when they realize, oh, he hasn’t lived as much as we think,” Thompson said. “There is some validity to that. Even at 35, I can tell you that having a conversation with a 20-year-old makes it very clear to me that life experience is valuable.
A lack of business experience may be one of the reasons young entrepreneurs think their age may keep them from being “taken seriously,” according to a study commissioned by Herbalife Nutrition, a global marketing company specializing in food supplements. The survey, conducted among more than 25,000 respondents in 35 countries, found that 62% of young entrepreneurs think their age bothered them when they tried to start their own business.
That number comes as no surprise to Dan Hiles, who owns Usual Suspects and Kettle Top Brewhouse in downtown Anderson. In 2015, at the age of 29, after having worked for eight years at Nestlé, Hiles and his wife Cali decided to start their own business. He approached two different banks for loans to help cover start-up costs.
“Both of them gave me comments that basically translated to, ‘You have to quit Nestlé, your career job you’ve been at for eight years, and go look for a job with Applebee in a restaurant,’” recalls. Hiles. “That’s what the comments were to me because they said, ‘You don’t have any experience. “
Business fundamentals, including developing an operating plan, managing expenses, and tracking revenue, didn’t come naturally to Jeffrey Chatman, who co-owns the Dapper Cat Café with his wife, Jerrica. , in downtown Anderson. The couple opened their ice cream shop in 2019 and weathered the pandemic storm last year. Jeffrey Chatman said he learned some hard lessons along the way.
“My goal was just to come in and work as hard as possible, and I quickly learned that you can’t overcome financial illiteracy,” he said. “It took me a while to try to learn – and there is still a certain business language that I don’t speak, especially when it comes to finances – so I felt like it didn’t. there wasn’t a level playing field, but it was I was afraid to try to attack. I wanted to learn. “
A significant challenge for many young entrepreneurs, especially those who are just starting out, is persuading potential investors to take a chance on their business. According to the US Small Business Administration, about 90% of startups fail every year, a grim statistic that remains virtually constant every year. This, coupled with the metrics that many lenders use to make loan decisions, can work against young aspiring business owners.
“Age wouldn’t have a direct impact on a lender’s decision to finance a small business, but we would look at the credit score that is affected by how long you’ve had credit,” said Adam Hoeksema , executive director of Bankable, the non-profit association of the Flagship Enterprise Center. lender arm. “Age could indirectly lower your credit score and make it more difficult to approve a loan.”
The study also contained good news for millennials, with nearly six in ten saying they are better at adapting to new technology than other generations, and 43% saying they think they have new and untapped ideas. Perhaps more importantly, 28% of those who expressed a desire to open their own business said they were “less afraid of failing” than other generations.
“Being able to adapt and market ourselves has been one of those great things that being young we might be a little bit better able to do,” said Jeffrey Chatman. “Plus, one of the things with young business owners is resilience. If you’re resilient, you’re able to bounce back from things like pandemics, civil unrest, things like that. “
Hoeksema added that besides the comfort with technology, the energy to start a business and the ability to connect with young clients, young entrepreneurs have other advantages.
“When you’re young, maybe you can take more risks when you start a business,” he said. “If you don’t have a family yet, your cost of living will be lower, allowing you to reinvest in growing your business instead of having to take a big paycheck to cover living expenses.
“Plus, if you start a business and fail, you will have learned something and still have plenty of time in life to start another business or take what you have learned and use it in your career.”