It’s a common myth that all, or at least many, startups emerge from late-night coding in a messy dorm room, beer bottles littering the floor and a bunch of lonely nerds typing at their computers into the wee hours of the morning while their more-popular classmates are out partying. It’s a romantic notion, certainly — the outcasts getting their comeuppance against the cool kids, finally emerging the winners once their companies start raking in the big bucks.
The reality is that many companies are started by folks on the dark side of forty — and quite a few of the highest-growth startups by people considerably older than that. A Kauffman Foundation study of five thousand companies founded in 2004 found that 48% were started by people over 45, and those companies comprised 64% of the ones that survived until at least 2008 — meaning they were considerably more successful, on average, than the companies started by the youngsters. Most shockingly, the study found that people over age 55 were twice as likely to launch high-growth startups as people aged 20-34.
Many of these older founders come out of industry, their previous experiences giving them the background and skills they need to identify problems and come up with winning solutions.
seedchange is just one example of this trend. Co-founders Kevin Smith and Nate Phillips were years out of college when they began the company, leaving legal careers in the financial industry to do so. They saw an enormous market opportunity that was only apparent due to their years in industry.
Having spent time at Wall Street law firms (Phillips), and developing and launching funds in a dozen countries for BlackRock, Morgan Stanley, and CQS (Smith), the two co-founders understood the challenges and believed their backgrounds gave them the ability to do something virtually no other team would be able to accomplish: create an entirely new asset class, make it accessible to investors worldwide, and, from the ground up, build a new global financial services company.
Co-founder Greg Moore, a former professional baseball player, spent ten years at SportVision developing pitch tracking technology used in the television broadcasts of baseball games (winning a Sports Emmy in 2007 for his work on broadcast technology) and leading the company’s development and sale of products to Major League Baseball.
He left because he was tired of the politics unavoidable in large organizations, and the inability to move quickly and nimbly in the marketplace. Working night and weekends at the start, he got to a point where he felt he could have a much bigger impact on his own than at SportVision, and moved to Fit3D full-time.
Since then, the company has developed a thoroughly innovative product that takes detailed body scans, analyzing over three hundred body measurements — creating shockingly accurate avatars that allow users to track fitness goals, physical development, and weight loss.
Before starting ContractRoom, co-founder Emil Stefanutti had founded two previous companies — America Riches Network and Real Manager. He had also held senior positions in the NBA and Planeta Networks. Co-founder Peter Thomson founded two software companies when he was younger, and then spent a decade in the financial industry, most recently at Merrill Lynch.
Together, they founded ContractRoom, a cloud-based negotiation and contract workflow management platform that helps enterprises negotiate, manage and track agreements efficiently. It was only through their past experiences that they understood the pain points of the industry and how to solve them. The software shaves thousands of hours off the time required to produce repeatable agreements such as NDAs and software licenses.
These three companies only scratch the surface, providing evidence that sometimes age and experience are advantages, not hindrances, and that industry experience can often provide the knowledge base necessary to launch a successful entrepreneurial venture.