Over 50 and in their prime
While producing 'Too Young to Retire', the Money Programme’s Valerie Singleton interviewed...
While producing 'Too Young to Retire', the Money Programme’s Valerie Singleton interviewed Sir Alan Sugar, along with a number of other experts, about older entrepreneurs. Here you can watch extended versions of several interviews.
Sir Alan Sugar
The chairman and CEO of Amstrad, talks about the growth of older entrepreneurs in the UK, why he feels age and maturity is undervalued and offers advice to budding entrepreneurs.
WatchYou need the Flash Player (version 7 or higher) to view this clip - download Flash. http://podcast.open.ac.uk/open2media/money-programme/series8/alan_sugar.flv Copyright BBC
On reasons for older entrepreneurs
I think they've got to a stage in their life where all of those commitments of having to look after their children and provide for their family and all that stuff have kind of gone away, either their children have grown up and are on their own, their mortgages are no longer something which are giving them problems, they've worked in a job all of their life and suddenly that entrepreneurial spirit that always existed inside them, has sprung to life.
Is experience and maturity is undervalued?
Most definitely. Mature people that have worked all their lives in companies and organisations and had-held high positions have picked up a lot of knowledge and that knowledge is wasted if it's not deployed afterwards into something constructive and I'm afraid to say that some people believe that this is a kind of a young man's world really, or a young woman's world, and that when you get past a certain of age of fifty kind of it's all over, well they're wrong, they’re totally wrong, because there's a wealth of experience there that is untapped.
On his own enthusiasm for business
I like new challenges, new ideas, new directions and of course I can afford to dabble in new things and not worry about whether they go wrong or go right. And trust me, you know, there's…where I… one thing I always tell young people is that you look around and you wonder why you see in these giant organisations people of the age of sixty to sixty five that are either the chairman or the chief executive. And there's a reason for it. The reason is they know what not to do. Not so much what to do but what not to do.
Advice for budding entrepreneurs
Here's my best advice to anybody. You see, a lot of entrepreneurs, be them young or old, think that what you do now is you switch your PC on and you get one of these PowerPoint presentations and you produce this wonderful business plan in multicolours and lots of spreadsheets and you just walk off into a bank and they're gonna give you some money. Wrong. Totally wrong. And I don't blame the banks either. I wouldn't give anybody any money that's got no experience of anything, no assets in it themselves, you know. I always talk about something called ‘hurt money’.
What is ‘hurt money’?
I want to see how much you've stuck of your own money in there. So if every bit goes down you're gonna get hurt to that amount.
On taking risksGo for it but again, you know, there is no guarantee of success so don't sling everything into it but… and certainly go and enjoy yourself really, you know, because you've had it, you may… it may have existed inside you all those years and now you've got the opportunity of showing everybody what you can do.
Professor Colin Gray
Colin Gray, from the OU Business School, shares his views on the meaning of the word ‘entrepreneur’, on the new trend for older entrepreneurs and the push-pull factors involved.
WatchYou need the Flash Player (version 7 or higher) to view this clip - download Flash. http://podcast.open.ac.uk/open2media/money-programme/series8/colin_gray.flv Copyright BBC
On the meaning of ‘entrepreneur’
It generally means somebody who's [twicing] a competitive edge over the other people, so the word competition is involved in it, through developing or exploiting an innovation. So there's something new, something that other people haven't done. It doesn't have to be a product, that could be a new way of doing things. It could be a new service. That's what an entrepreneur does.
On the trend for older entrepreneurs
It is a new trend but it's caused, I suppose, by the general aging of the population. It's also caused by shifts in demand for particular skills by employers, and sometimes people reach a sort of watershed at the age of 50 and a lot of people lose their jobs at those times. They take early retirement, sometimes voluntary, sometimes not so voluntary. The horrible thing is that if you're aged under 50 and you lose a job you've got a 60% chance of finding one. If you're aged more than 50, you've got about a 10% chance. So if you want to still-- you still need to earn a living then you've only a few options open to you and...becoming self-employed or following through an idea that you've learnt from your experience in work is...presents a much more attractive option than doing nothing.
The push-pull factor
Well push is necessity, when you actually don't have much of an option. And self-employment, and I won't-won't call it necessarily entrepreneurship because it may not be about huge innovations, it's about survival, pushed through fear of unemployment, through unemployment itself, through lack of, lack of earnings. Those sort of factors.
Ah, the pull is the, are the incentives, the ones where people do it through an intrinsic interest in... in doing something themselves. They... most entrepreneurs and most self-small business owners if asked why they're doing it, they'll say “I want to be independent”. And, quite often that means “I just want to be my own boss. I want to make the decisions.” It can also mean something less...less adventurous than that is, “I don't want to be told what to do”. Well these people tend not to do so well but the ones that want to be their own boss and take responsibility, you know, for organising a small little...organisation [everything] include-includes other people, they tend to be very, very successful.
Advice for older entrepreneurs
Be absolutely clear in your own mind about what you want to do. That's where... all things actually flow from that. Then the second thing is, if you… if you do need to get external finance, make sure that what you're doing is seen as being likely to succeed in the eyes of those you're gonna go for, for money. In other words make sure your pitch is pitched to what they want to get...to the way they would want to see it, rather than the way you would want it to be... Which means, thirdly, think more about the market and where you're heading rather than about the product that you're trying to sell. One of the dangers that entrepreneurs and inventors have is they fall in love with their product, and they...they never fall in love with the customer, so they never get-get round to doing it. And I suppose the fifth one is don't give up. Persistence is the other clue to success.
The executive director of PRIME, talks about PRIME's aim to help people over 50 work for themselves, age discrimination in industry and the reasons why people start businesses in later life.
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Aim of PRIME
PRIME's aim is to help people over fifty who find themselves unemployed or at the threatof unemployment, threat of redundancy, to investigate self employment and if necessary and if they want to, to help them set up as self employed.
On age discrimination
There's an awful lot of age discrimination in industry, people find themselves pushed out as industries change, jobs are not secure any longer, it tends to be the over-fifties first. There's a lot myths about the over-fifties, employers seem to think that they cost more, they seem to believe that they're likely to be sicker, they seem to believe that they're less flexible, absolute myths but they're still held and believed.
On the reasons for over 50s starting their own business
Older people certainly start their own business because it's incredibly difficult to find work elsewhere. If you're aged about forty five and you get made redundant and you're six months redundant your chances of finding a job are one in ten, so really it makes sense for you to start thinking about self employment, and I think the real challenge for the government and for the community is to really help people to start thinking of self employment about creating their own job very soon and very quickly if they are made redundant.
What I do think is most worrying is that the over fifties become a forgotten generation, they're left out: one in three of them is workless, they're looking for money to finance the last third of their life, arguably the best third of their life, or it should be. So they want to make an income, create an income for themselves to really make that last third of their lives worthwhile.
On the reasons for the over 50s being out of work
A lot of workers over fifty are finding themselves workless. The main reason is that industry is throwing people out, making them redundant at around fifty, there's an awful lot of change going on in industry, there's no jobs for life. I think if you look at most industries, you will find that they haven't got the same percentage over fifties working for them as you would find in the community.
Are older entrepreneurs more successful?
There's not a - a great deal of evidence that olderpreneurs are more successful than younger ones, but the evidence there is suggests yes they are more successful, they've done better their businesses last longer. Why is that? Well I think that older people starting their businesses have a lot of life experience, they have skills in dealing with people, they're more prudent, they know how to deal with issues that have come up throughout their lives whereas younger people are thrown by these sorts of things.
On remaining youthful
People aged sixty five today are far younger than they were fifty or sixty years ago. Our parents and our grandparents, if they reached sixty five they really put on their cardigans and their slippers and felt well let's, ah - well they didn't watch television but let's listen to the radio, do the knitting, look after the grandchildren. Someone at fifty has got a third of their life in front of them, wow, they want to do things with that now they want to use that and we are much healthier than we were, we can do those things.
Have you got a business idea? Can you see a gap in the market? Hone your entrepreneurial skills with the Investigating Entrepreneurial Opportunities course.
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Copyright & revisions
Originally published: Friday, 22nd June 2007
Last updated on: Friday, 8th February 2008
- Body text - Copyright: The Open University
- Video 1 - Copyrighted: BBC
- Video 2 - Copyrighted: BBC
- Video 3 - Copyrighted: BBC
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