Opportunities for Entrepreneurship in Later Life

Abstract

Stuart J was a s8-year-old executive with a Fortune soo technology company that sold computer systems to large retail companies. Stuart had become an expert in supply-chain management, financial transactions, inventory control, and employee training, all of winch are key to success in the retail industry. After twenty-two years with the company, Stuart filt he was well paid. He received the full range of benefits, including health, life, and disability insurance, and he had a generous pension plan. He expected to work for the company until he retired in about ten years. Then he was fired. Stuart's company had merged with another large computer-systems provider. The resulting company consolidated the retail computer-systems groups from both companies, eliminating Stuart's division. Stuart received a six-month severance package that left him about nine-and-a-half years short of the income and benefits he had thought would carry him to retirement. Replacing his job proved impossible- perhaps because of age discrimination, perhaps because companies prefer to promote from within, or perhaps because Stuart's salary expectations were out of line with the reality of smaller companies in other fields. After eight months of frustration, humiliation, and intermittent depression, Stuart decided to start an entrepreneurial venture. His plan was to become a consultant, create a newsletter for his industry, and run conferences. The transition was harder than he had imagined. He had no support servias at his disposal, and organizing a limited liability corporation, setting up an accounting system, designing a logo, and even naming his new company took much more time than he had anticipated. Stuart earned nothing for eighteen months, borrowed against his pension, and strained his marriage. But, finally, he made it work. Last year, his fourth in operation, Stuart worked widi eight clients, published a monthly online newsletter, and ran a conference. Most important, he made a profit. Now, Stuart loves his work, takes great pride in the success he has built, feels it was agreatgrowth experience, and now believes that being fired was the best thing that ever happened to him. Stuart J is a later-life entrepreneur whose story reveals the issues and challenges that many other people are currently facing. Stuart found the world of traditional employment less welcoming to him at his age than he had hoped, but he had financial goals that he had thought he could not meet any other way. When he was unable to replace the job he had lost, he had to make another choice. Becoming an entrepreneur was difficult, but ultimately rewarding. Working for a large organization had provided structure, identity, and interaction widi a group of colleagues, but being a home-based entrepreneur gave Stuart tremendous freedom. Smart was also a winner at a game that most people lose. Most new business ventures fail, often leading hopeful entrepreneurs to financial problems and subsequent careers that are far below their capabilities and ambitions- or to second and diird tries at other ventures. STATISTICS ON ENTREPRENEURSHIP AMONG OLDER ADULTS While there are numerous studies of the United States workforce, few have collected information about entrepreneurship among older workers. Among the few diat have is The National Study of die Changing Workforce, which surveyed workers of various types, most recendy in 2002. The large sample used provides an in-depdi look at employment issues among the working population. The study clearly shows a strong association between age and entrepreneurship. Table 1 shows diat while 8 percent of workers ages 50-59 are small business owners, 12 percent of workers over 60 years of age own their own businesses. Similarly, 13 percent of workers 50-59 years old are classified as self-employed independent workers, while 26 percent of workers over 60 are selfemployed independent workers. …