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Tech Start-ups Aren't Just for Wunderkinds

Posted by timothy on from the just-a-myth-spread-by-dead-white-males dept.

jonniee writes "The results of a new report from the Kauffman Foundation are contrary to what we usually hear about U.S. tech start-ups. Who are these entrepreneurs? Is the report in sync with what you're seeing?" According to the linked article, "Challenging the perception of American technology entrepreneurs as 20-something wunderkinds launching businesses from college dorm rooms," the new study "reveals most U.S.-born technology and engineering company founders are middle-aged, well-educated, and hold degrees from a wide assortment of universities."

96 comments

  1. It is good to see... by Raineer · · Score: 1

    It's good to see that the "older" crowd is also involved in start-ups. Most of the 40-somethings around me are stick-in-the-muds who have no interest in change or taking any risks.

    It makes it easier for me to succeed. Though I did just turn 30, not as much a youngster anymore. I think the biggest reason 20-er's succeed is they do not understand the world wants them to fail (so they don't). Older folks are so much more cynical that they don't step out of the comfort zone.

    1. Re:It is good to see... by Narpak · · Score: 1

      And perhaps because those that might want them to fail just don't have the technical in sight, at least not until later, on how to stop them.

      Or perhaps it's because many technologies are still at an early stage of their potential, and that those with insight and drive manage to find new areas from which they can make a profit. Not to mention the opening of new world markets where innovative companies might find opportunities overlooked by older, more established corporations.

      --
      The Long Now Foundation
    2. Re:It is good to see... by Kadin2048 · · Score: 4, Insightful

      > I think the biggest reason 20-er's succeed is they do not understand the world wants them to fail (so they don't). Older folks are so much more cynical that they don't step out of the comfort zone.

      I'm not sure this holds water. There's a perception that young entrepreneurs are successful, but it's basically a myth, perpetuated because of all the attention that a few (rare) successes bring.

      The entire focus of the article is that most startups, and I'd be willing to wager most successful companies, aren't started by young people fresh out of college. They're somewhat unsurprisingly started by people with experience in the industry. But "several well-educated 40-somethings go to a bank, get a business loan, rent an office space, and start a new company by filling a niche they know there's a demand for" just doesn't make for as exciting reading as "two college kids in their dorm room risk it all and run up credit card debt pursuing their dreams".

      Really it's just the real world turning out to be less romantic, you might say, than the media sometimes makes it out to be. No real surprise there.

      --
      "Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
    3. Re:It is good to see... by Dancindan84 · · Score: 1

      I'm not sure this holds water. There's a perception that young entrepreneurs are successful, but it's basically a myth, perpetuated because of all the attention that a few (rare) successes bring. I agree, and it's not just limited to young entrepreneurs. The media focuses on the rare successes (and failures) to the point where they seem commonplace. If you were to believe what they feed us, you'd think that all today's schools are filled with prodigy, gang member, anorexic, obese, and and suicidal students taught by sex fiend teachers. It's news because it's -not- ordinary, so thinking of the news as representative of the average world is obviously going to be wrong.
      --
      "Always forgive your enemies; nothing annoys them so much." - Oscar Wilde
    4. Re:It is good to see... by asc99c · · Score: 3, Insightful

      Partly I think it's just that if you're the sort of person who is going to have success as an entrepreneur, it's all about drive, vision and creativity. Those don't tend to increase that much with experience.

      Kind of like what they say about Mathematicians - if you've not made a big contribution by your 30s, you probably never will.

      On the other hand engineering work is very much improved by experience, and many of the best engineers I know are in their 40s or older.

      So the newsworthy startups are often started by college kids. But the majority of startups have a decent if not earth shattering premise, backed up by business and engineering skills built up with experience and run by older people.

    5. Re:It is good to see... by mpapet · · Score: 2, Insightful

      Most of the 40-somethings around me are stick-in-the-muds who have no interest in change or taking any risks.

      As one of those 40-somethings, it depends on the environment in which they work and the risks they've taken.
      In the bigger places I've worked, blame-shifting and doing nothing was the standard operating procedure. It's a very corrosive environment that has little to do with age.
      For some do-nothings, they've got a significant other they'd like to stay married to, a family to feed and educate and a mortgage too. That can chill the entrepreneurial spirit.

      Most of the responsible adventurers have got a really good pad to fall back on or have a failure path more or less worked out. If they go the VC route, they'll get a sexy start up story made up, or even a young face to act as the "sexy startup" proxies while the old guys actually get the work done. (Though, they usually provide the cash)

      --
      http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
    6. Re:It is good to see... by Anonymous Coward · · Score: 0

      I'm 52. Most of the 20-somethings around me are stick in the muds who have no interest in change or taking any risks that might involve some real work.

      Maybe it's more accurate to say that people who are interested in change and willing to take risks, are few and far between. Also, such people come in all ages, races, and sizes.

    7. Re:It is good to see... by Raineer · · Score: 1

      It's a very corrosive environment that has little to do with age. I'll grant this in a heartbeat. 'Corrosive' is a perfect way to put it. I agree, it is difficult to keep a positive attitude and think you are someone who can "make a difference" or be successful when the industry continues to beat you down. I lumped older workers, probably unfairly, in this paradigm. In fairness to my original post though, I did qualify it with those people "around me".
    8. Re:It is good to see... by dreamchaser · · Score: 1

      I'd be willing to place a small wager that the success to failure ratio is far more favorable to startups created by people with some life experience rather than those created by 20 year olds.

    9. Re:It is good to see... by Repossessed · · Score: 1

      Given that the older crowd is more likely not to have a technology background going by the article, I wouldn't be as sure. Product isn't everything, but how well can you do if you don't have a good product when you don't already have connections for the company?

      --
      Liberte, Egalite, Fraternite (TM)
    10. Re:It is good to see... by Anonymous Coward · · Score: 0

      You know, that sounds like a good business idea, a f*ckdcompany with wagering built in. You should consider building it, I'd use it!

    11. Re:It is good to see... by Anonymous Coward · · Score: 0

      Older workers tend to have kids to support, big insurance and tax bill, mortgage woes and so on. There's more to it than putting food on the table. All those out of school activities really eat into time, even with two parents and only two kids. Before I was married, I could do what I liked, when I liked, working well into the wee hours on interesting projects if I got the buzz.

      Having parents that didn't give me the time of day, I ensure my kids get all they need. Even if it means sitting bored while they have their fun at the gym, soccer, t-ball et al. It's fun watching at first, but after a few tips it becomes yawn factor ten.

      Last year I was working with a start-up venture that appeared very promising. For four months I put in over 350 hours a month. Not a huge amount, but well over standard 9-5. I hardly saw my family, and my kids felt I was becoming a stranger. That is very bad so I made changes.

    12. Re:It is good to see... by bkr1_2k · · Score: 2, Insightful

      No, the biggest reason 20 somethings succeed is that they have less to lose if they fail. Thus, they are more likely to take the risks of losing it all.

      --
      "Growing old is inevitable; growing up is optional."
    13. Re:It is good to see... by sgt+scrub · · Score: 1

      It makes it easier for me to succeed.
      Which is why I was trying to avoid posting. The Kauffman Foundation needs to stop giving out secrets. If 40 somethings found out they could take their experience and make a go at it on their own... hey wait! You little shit! What do you mean older?!? 40 isn't old!

      --
      Having to work for a living is the root of all evil.
    14. Re:It is good to see... by Anonymous Coward · · Score: 0

      Given that the older crowd is more likely not to have a technology background going by the article, I wouldn't be as sure. Product isn't everything, but how well can you do if you don't have a good product when you don't already have connections for the company?
      I would say it's more being able to survey the industry landscape, identify a need, and fill it.
      The high risk groundbreaking start-ups are the ones founded by the 20 somethings; the lower risk fill a niche startups are the ones started by the older crowd.
    15. Re:It is good to see... by bkr1_2k · · Score: 1

      Exactly. Anyone who's spent time actually trying to get a company off the ground by interacting with other companies (not creating a software product in the basement) sees this constantly.

      Most companies, especially tech companies, are started and managed by people in their late 30s and early 40s who've garnered enough success and experience to venture out on their own in a field they are familiar with and where others are familiar with their work.

      --
      "Growing old is inevitable; growing up is optional."
    16. Re:It is good to see... by WhiplashII · · Score: 1

      As a startup guy, one thing you hear over and over from the money guys is that they'd rather fund a good team with a lousy product than a great product with a mediocre team.

      People are everything in this business.

      --
      while (sig==sig) sig=!sig;
    17. Re:It is good to see... by Coldmoon · · Score: 2, Insightful

      Quote "The entire focus of the article is that most startups, and I'd be willing to wager most successful companies, aren't started by young people fresh out of college. They're somewhat unsurprisingly started by people with experience in the industry...".

      I am one of those who did not even get involved seriously in the industry until I was in my mid 30s and never had much use for standard 9 to 5 jobs so have worked as a hired gun most of my career.

      This experience has provided a rich return as far as experience, maturity, and (most importantly) contacts that have allowed me to create my own niche that plays to my personal talents and experience. Further, I have never been afraid to take a chance and "risk all" when I believed in the project.

      The real determinants on who is more likely to have a successful startup are not really age, rather it is more about the personal traits of the people creating the startup. If you are not prepared to risk it all, you are likely not to succeed...

      --
      Coldmoon over Dark water...
    18. Re:It is good to see... by Goblez · · Score: 1

      I think the biggest reason 20-er's succeed is they do not understand the world wants them to fail (so they don't).

      Actually this is my biggest motivation. And it seems when times are rough one of my only motivations.
      --
      - Kal`Goblez
    19. Re:It is good to see... by Anonymous Coward · · Score: 1, Insightful

      Partly I think it's just that if you're the sort of person who is going to have success as an entrepreneur, it's all about drive, vision and creativity. Those don't tend to increase that much with experience.

      Kind of like what they say about Mathematicians - if you've not made a big contribution by your 30s, you probably never will.

      On the other hand engineering work is very much improved by experience, and many of the best engineers I know are in their 40s or older.

      So the newsworthy startups are often started by college kids. But the majority of startups have a decent if not earth shattering premise, backed up by business and engineering skills built up with experience and run by older people.

      The biggest problem I've seen with the younger people in charge of startups is that even the rare ones truly gifted with drive, vision, and creativity just don't understand business. So, they may know their engineering, and they may have a good handle on their market, which is what's key, I think, but they sort of expect everything else just to fall into place, and it doesn't. The smart ones are fully aware of these gaps in their experience and value the people who can fill them in. More often than not, the successful companies hooked up with more experienced people early on and together they made it work. Many of the flashy stories about young entrepreneurs' success tend to gloss over the fact that it was a small, but diverse team that made it all happen, not just two hackers with a cool idea.


      Fortunatelty, when things do go great, the older C-levels and server architects and such bank so much money, they don't care much who Good Morning America calls a genius.


      In any event, I'm not minimizing the contributions of young entrepreneurs, but as many here seem to have realized already, the media does romanticize a bit.

    20. Re:It is good to see... by flynn23 · · Score: 1

      That's partially true, but the real reason is that 20-somethings have less to risk (both financially and personally) and don't have the burden of responsibility that most older workers would have (family, mortgage, etc). They also command less money when the business gets going because of inexperience and market rate. This is why financiers prefer to work with younger workforces. More time on the job, smaller costs, less aversion to risk.

    21. Re:It is good to see... by Anonymous Coward · · Score: 0

      today's schools are filled with prodigy, gang member, anorexic, obese, and and suicidal students taught by sex fiend teachers. Funny, that's all I remember.
    22. Re:It is good to see... by Eli+Gottlieb · · Score: 1

      Naw, they couldn't be anorexic and obese at the same time!

    23. Re:It is good to see... by cowscows · · Score: 1

      I think the reason that most of these 20-something wunderkids have seen such big successes boils down mainly to luck and probabilities. There's lots of people out there at all sorts of ages who are working hard, and it's just the nature of how the world works that some end up being in the right place at the right time, and things just sort of fall into place.

      Hard work and great ideas are very important, no doubt, but there's always an element of chance involved. Chance doesn't discriminate in regards to age, so everyone can benefit(or sometimes suffer) because of it. In some ways it's the ultimate equalizer.

      All that being said, the computer/internet industry has made younger entrepreneurs a little more likely, only because the cost of entry for software is so low in terms of initial capital.

      --

      One time I threw a brick at a duck.

    24. Re:It is good to see... by geekoid · · Score: 1

      It's about risk.
      Older people don't want to risk there children's health and future.
      I suspect that if the US had a decent nationalism health plan, a lot of people would go out to start their own business.

      --
      The Kruger Dunning explains most post on /. http://en.wikipedia.org/wiki/Dunning%E2%80%93Kruger_effect
    25. Re:It is good to see... by ArikTheRed · · Score: 1

      I think the biggest reason 20-er's succeed is they do not understand the world wants them to fail (so they don't). Older folks are so much more cynical that they don't step out of the comfort zone. Naw, I think it's just the law of large numbers. you see successful 20-something startups, because so many educated 20-somethings start them. Then the herd gets thinned, the droves of eager-beavers get older and bitter, and the 40-somethings left know their shit. There may be fewer of them, but they're more likely to succeed, per capita.
      --
      http://www.coderoshi.com/
    26. Re:It is good to see... by colmore · · Score: 2, Insightful

      New technologies give little advantage to the experienced, and so the playing field is flat for creativity, fresh perspective, and all that lovely stuff to succeed.

      That said, there's a lot more maxed out credit cards than there are Facebooks.

      Still, I think the reason that there's a perception of startups being littered with 21 year olds, is that when a 21 year old's startup does something noteworth, a LOT more gets written about it.

      A general phenomenon I like to call the "Action News" effect. If something is being reported on, it is an anomaly not the rule. The stuff on Action News doesn't kill your kids, cars and run of the mill accidents kill your kids. Kidnappings by strangers are so rare as to be national news. Etc.

      --
      In Capitalist America, bank robs you!
    27. Re:It is good to see... by Cal+Paterson · · Score: 2, Insightful

      I've only briefly examined the report, but it's already clear that there is a strong selection bias in the results. They're pulling from a database of companies worth $1m+ founded between 1995-2005. There are probably at least four issues with this:

      First, it doesn't properly account for businesses that take a long time to mature. it's very possible that a business started in 2003-2005 hasn't broken the $1m+ barrier yet, and these companies aren't examined at all by the survey.

      Second, they aren't using the best data for tech companies; it's pretty plausible that many tech companies aren't in the database of companies for having simply failed to be submitted (it's a largeish, largely automated database), or have confusing accounts such that they either aren't directly eligible or aren't. This is a big deal particular to "young people" style tech companies; they're often not traditionally founded or managed, and so are less likely to reply to some external survey.

      Third, they are reliant on businesses to respond to their requests for information. Around 40% did this. I suspect this creates a bias towards traditional CEO-style corporate hierarchies - exactly the kind of corporate hierarchy that a Silicon Valley business only 5 years old and started by University graduates is unlikely to have. A business started in a garage is probably unlikely to respond to some cold calling survey pollster.

      Finally, and probably most importantly, they have failed to be specific enough about the kind of company that they are trying to measure. I haven't had time to look precisely yet, but other studies of tech business have suffered from the difficultly of including a lot of not-quite-really-if-we're-honest tech companies. I'm talking companies that don't do a lot of R&D, and companies that are generally pretty low tech. This is a pretty serious (and probable) bias considering all the data is drawn from a single, third-party database, because these companies are so unlikely to have the typical "California Startup" DNA that the study is testing for.

      Additionally, it would be better if they'd done the survey in a way to examine the near-miss companies that did reasonably well but failed. It would add extra insight because there is an awful lot of luck in the startup business game, especially in tech. This survey would better examine this topic if it was more carefully followed tech startup-specific data.
      Sadly, this study doesn't prove a whole lot. The data is too marginal and suffers from the typical issues related to drawing many times derived conclusions; to inherit all the biases of the study below you in the chain. This is a really big deal if the study below you is general in nature compared to your interests.

    28. Re:It is good to see... by root-a-begger · · Score: 1

      Good article to set people straight on how mundane most startups are. I am almost 40 and http://www.shellshadow.com/ is my 3rd startup (not counting the half-baked college days projects).
      I have purposely narrowed my focus on this one. Some has to do with age and risk profile changing. But the other reasons are that I do have more experience and understand that my goal is to fill a niche and that initial niche better be good enough to get to sustained profits quick. If I can take on adjacent markets and grow from there, fantastic. But that better not be required.

      Jon Hancock
      http://www.shellshadow.com/

    29. Re:It is good to see... by cbart387 · · Score: 1

      The biggest problem I've seen with the younger people in charge of startups is that even the rare ones truly gifted with drive, vision, and creativity just don't understand business. I think you could say the same thing about any type of managerial (or leadership) position. For example, I'll soon be a college graduate. I tend to be pretty good with the technical stuff however I know I don't have the real-world experience to be in a leadership role. I could see myself being there in a couple years but not at this point.

      So I can see what you mean. If I was to start a business I'd want to hire someone to do the managing of it so I could focus on the technical side.
      --
      Lack of planning on your part does not constitute an emergency on mine.
    30. Re:It is good to see... by Deliveranc3 · · Score: 1

      I'm not sure you can go to university and read slashdot without coming up with several "it's so obvious, someone else must be working on it" ideas.

      The question of whether fourty something's that think in industry terms or 20 somethings with a compiler and a dream will be more successful is dependant on the economics in your area.

      Spam is making people much less receptive to "genius" ideas developed and distributed over the interwebs... people want microsoft certification on software, pretty shiney interfaces and so on.

      I'm positive that 90% of what consultants do is duplicated with little VB scripts that have never been consolodated... unfortunately VB apps don't wear suits.

      I asked my boss if I'd be paid less if I left university and he said "definitely." Like the mispreception that continued work makes something more valuable people don't seem to be able to deal with the fact that there really isn't a hole in creativity, management knowhow, or dedication that appears between graduation and being fourty-five with a wife and kids.

      Given that nine out of ten tech startups fail, it seems to me that it's a game for basement dwellers.

      Web2.0 and the "host everything centrally" mentality is going to kill small software startups, it's one thing to write a voip application that does something creative... it's quite another to try and get POTS connections and server space to handle thousands of simulataneous users downloading their messages.

  2. Doesn't seem surprising by haluness · · Score: 2, Interesting

    Sure, some of the high-profile startups might be the result of a wunderkind in a dorm or garage. But it's also true that by definition, these types of startups are going to get a lot of publicity.

    It would make sense that someone with more experience under their belt might be a good candidate for a startup.

    Also, I'm of the view that startups don't necessarily have to solve all the worlds problems (ala Google) or even solve sexy problems. There are enough niche areas, where experience and knowledge counts as much (if not more) than youth.

    1. Re:Doesn't seem surprising by oncehour · · Score: 1

      I'd agree with this, definitely. In my consulting business the majority of my clients are startups, but they're also older people. People in their 30s or 40s and sometimes even 60s who are looking to create a business, have a sound idea, very well designed business plan, and considerable investment ready. In my experience, the younger startups typically don't have as much planning done and usually pull through with funding by the skin of their teeth.

      This doesn't mean that the budding entrepreuner should just rule out creating a startup altogether, but replace "startup" with business when talking about it. Take away the sexiness of it and focus on the core goals. What will your product be? How will you make money? Is there a market for it? If not, can you create a market for it easily? What sort of funding sources do you have available? What's the estimated profit margin on your product? Take away 50% on that estimation for random costs and can you still survive?

      This is just the start of the things that the younger companies tend to not really cover, but the older more experienced people have down pat. It's understandable that someone without experience isn't going to be as good at judging a lot of these things. In that case, I recommend hiring a consultant to do some of the work for you. Personally I do starter business analysis like this for $500 - $2000 but you may find cheaper consultants elsewhere.

      Whatever you do, make sure you have at least some idea of a plan and some concept of how much money you're going to be making. If you're dealing with a market that's traditionally low volume you need considerable markup. Don't fall into the trap of "we're unique and gonna change the industry!". It's not that you can't change the industry, it's just that every business has basics that are absolutely required to succeed and if you forego them then you're just leading yourself towards failure.

    2. Re:Doesn't seem surprising by Thelasko · · Score: 1

      Mod parent up
      Startups run by 40 somethings are not news.
      Startups run by 20 somethings are news
      Therefore, most people believe that successful startups are run by 20 somethings.

      --
      One of our competitors trademarked the term "hypothesis". From now on, we will call them "boneheaded ideas".
    3. Re:Doesn't seem surprising by Anonymous Coward · · Score: 0

      "But it's also true that by definition, these types of startups are going to get a lot of publicity."

      What dictionary are you using please??

  3. Surprised? by jchawk · · Score: 1

    I'm not sure that this is surprising to anyone... So you've got a great idea? Perhaps the next big thing? Now you have to worry about raising capital, starting a business, locating space to work, equipment, licensing, regulations, etc...

    It's just not as simple as -

    1. Idea
    2. Profit

    Running a business is tough even when you have a great idea! It's not surprising that older more experienced people are involved in tech startups. Heck, look at google, two young guys but they had "handlers" to help them get going!

    1. Re:Surprised? by jt2377 · · Score: 0

      but it's easier to sell to investors and get massive free PR when your founder is 19 or 20 something like Gates and Job. FaceBook and MySpace are the perfect example as well. you can sell more magzine or ads if you feature some 20-something wonderkid vs putting old man Bill on the cover.

    2. Re:Surprised? by iamacat · · Score: 1

      No, but it's as simple as -

      1. Idea
      2. ???
      3. Profit

  4. Main Source Dellusional Madmen by Anonymous Coward · · Score: 0

    Seriously, the one startup I worked at had more dellusional sociopaths than any company I have been at since.

    It's not surprising that the company failed. If you value a steady paycheck stay away from compnies run by psychopaths, cuz it's alot easier for an idiot to start a company than run a company well.

  5. Don't forget ... by Anonymous Coward · · Score: 0

    ... to pay your $699 cock-smoking fee you licensing tea-baggers.

  6. This is a surprise? by Angst+Badger · · Score: 3, Insightful

    I've spent most of my professional career working for startups. Every one of them has been run by middle-aged entrepreneurs, most of them on their third or fourth attempt to run a successful business. I suspect this is because most investors wouldn't actually touch a startup with a ten foot pole, and most young people lack the personal resources to accumulate any startup cash. We hear about startups run college dropout wunderkinds precisely because they are unusual and therefore newsworthy, which is much the same reason we hear about absurd personal liability lawsuits instead of the millions of humdrum cases no one would bat an eyelash at.

    --
    Proud member of the Weirdo-American community.
    1. Re:This is a surprise? by ivan256 · · Score: 1

      You've basically nailed it.

      For every one startup founded by a 20-something year old within 40 miles of MIT, there are 25 started by somebody aged 40+.

      I don't have any official statistics on the success of these companies, but it seems to me that both types are just as likely to be successful. The older engineers have just had more time to come up with good ideas, and more experience to judge them by.

      The younger founders get more press though. "25 year old makes millions!" is a better headline than: "Person works whole life. Finally pays off". There are top ten lists of young entrepreneurs, but no "Top 10 old innovators" lists... Etc..

  7. Riiight.... by powerlord · · Score: 1

    Sure ... but our CEO just threw a tantrum and threatened to take his toys and go home if he wasn't properly respected.

    Don't worry though, we lured him out with some milk and cookies and shiny DVD to look at.

    --
    This space for rent. All reasonable inquiries will be entertained at proprietors discretion.
  8. Of course by metlin · · Score: 1

    As someone who has had a startup in the past, I can tell you that of course that is the case.

    In fact, when you look for angel investor or VC funding, one of the key elements that they consider is the background and pedigree of the founders.

    Your past experience, expertise, education (especially education) and pedigree (a well known school is easier to sell than a relatively unknown one) all play a big role in who you can talk to, and how seriously they will take you.

    Even when you talk to a potential client, they are interested in knowing your background. An seventeen year old high-school dropout telling a company's CEO that he has a panacea to the company's problems may happen in movies, but rarely in real life.

    Being able to install Linux or code in PHP or hack the kernel does not necessarily equate to understanding business needs.

    That said, if you have a truly unique and good idea, you may succeed without any of the above -- but that is rare, and few and far between.

    1. Re:Of course by witherstaff · · Score: 1

      The entrepreneur mindset is definitely a different way of thinking. You can't teach it, but it doesn't go away with age.

      I've been in a room full of Ernst + Young Entrepreneur of the year award candidates and the age range is all over the place but most are middle age+. Parent's right about talking with investors, and just having experience comes easier with age.

      The other reason you won't hear the 'rags to riches from a dorm room' story is that the older crowd often times can be an entrepreneur without having to take such drastic risks. They have built up an income base to let them take some risk. Further, older people will often be a little more modest. You won't hear them bragging about success, they already have the houses, the cars, the toys, or are past showing off their success.

  9. The end of an era - sort of by Gat0r30y · · Score: 1

    This is completely sensible. The era when a youngster with no advanced education could pop up and dominate a swath of the tech sector is mostly gone. There are certainly niches where that will still work, but the vast majority of the easy stuff has been done, and the success (or failure) of a start-up is increasingly dependent on who the starter upper has around them. If they are established and have solid connections to a local university (as it would appear from the article is the case in most of these start-ups) one would think that would be a good talent pool to pull from. On an only slightly off-topic note, I'm trying to start something of my own - at 24, and it ain't easy. I can see how the landscape favors those already well established, with a comprehensive set of contacts, and better access to VC. Anyone know how I might get a small amount of financing to get a project going?

    --
    Prediction: The real iPhone killer is going to be sex robots from Japan. Think about it.
    1. Re:The end of an era - sort of by metlin · · Score: 1
      Here are a few points:
      • Look for angel investors in your region.
      • Talk to the local chamber of commerce, and see if they have any ideas or suggestions.
      • Talk to your bank. Also try talking to some of the community banks nearby - a lot of them tend to give out small loans for individual entrepreneurs.
      • Look online for VC bloggers around your area (trust me, they are dime a dozen) and try to talk to them.


      It also helps if you have a solid business case, of course (and if you're presentable).
    2. Re:The end of an era - sort of by Reality+Master+101 · · Score: 1

      Anyone know how I might get a small amount of financing to get a project going?

      SBA loan.

      That said, here's a piece of advice: don't sit around waiting for someone to dump money on you. There are very few businesses that *really* require a lot of money to start. The best way to build a business is nearly always to start small, work your ass off (possibly while keeping another job), and gradually build it up *by yourself*. Don't get partners unless you absolutely have to.

      Do something *tangible* EVERY DAY toward your goal. And tangible means not writing down some plan you won't follow anyway. Tangible means, say, writing a hundred lines of code (if you're a programmer), even if you're dog-ass tired. Make 20 cold calls to drum up business. Live as sparsely and cheaply as possible and sock away every penny toward your dream. This can't be emphasized enough: STOP TALKING AND START DOING. Be bold. Be brave.

      Many want to have their own business. Few are willing to do the work or make the sacrifices in their lifestyle. Hard Work + Sacrifice == success.

      --
      Sometimes it's best to just let stupid people be stupid.
    3. Re:The end of an era - sort of by everphilski · · Score: 1

      Do something *tangible* EVERY DAY toward your goal. And tangible means not writing down some plan you won't follow anyway. Tangible means, say, writing a hundred lines of code (if you're a programmer), even if you're dog-ass tired. Make 20 cold calls to drum up business. Live as sparsely and cheaply as possible and sock away every penny toward your dream. This can't be emphasized enough: STOP TALKING AND START DOING. Be bold. Be brave.

      Amen. Even if you don't know it's what you want to do today, start reading business books, become aware of the environment you work in, and live frugally. My dad didn't know he wanted to have his own business when I was young, but he did know he didn't want to do what he was doing the rest of his life. He kept educating himself (he was a college dropout-turned-farmer, the family business) and we lived very frugally growing up, my parents saved money instead of spending growing up. Just last year, my dad finally decided it was time and he started his own financial consulting firm. But without the learning a bit at a time and the self-sacrifice of investing that money for later instead of spending it now, he'd not be where he is today.

  10. Wunderkinds is a better story by mpapet · · Score: 3, Insightful

    'Wunderkinds' type founder stories make better story telling than "I started my hosted application business in my garage after putting in my time at the DWP and seeing a need."

    Some of the most ridiculous startup fiction that come to mind,

    -Michael Dell. Both Mom and Dad Dell had the deeep pockets, knowledge, connections to grow their son's so-called dorm-room start up. Reselling PC's is very capital intensive for those who aren't aware of the business problems.

    -Cisco. After the guy who founded cisco stole/borrowed/whatever the IP from the university he worked for, the sexier fiction to cover up the legal gray area and ethical skulduggery was he used was to claim the networking technology was used to talk to his future wife. (or something like that) Meanwhile the guy who -actually- did all the work and seemed to have an ethical bone in his body, retired from the university in relative anonymity.

    Along with all of the VC money comes the story tellers to paper over most of ethically challenging details.

    --
    http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
    1. Re:Wunderkinds is a better story by ZonkerWilliam · · Score: 1

      To be honest this is common practice, people, ie. customers and investors, find fictitious startup reasons sexier and makes for good marketing. People like a good story and they like a company that seems to have a good story behind, fictitious or not.

  11. luck vs hard work by Anonymous Coward · · Score: 0

    Many of the "wunderkind" startups are the result of being in the right place at the right time - and that usually means having the right person backing you up in an immature market.

    For example, in Google's case, that was an excellent supervisor, $100k from Andy Bechtolsheim, then the financial genius of modern Midas Michael Moritz.

    There are exceptions. Wolfram Research is the result of a fairly smart, fairly covetous physics grad producing something that just worked well (sorry, Maple, you're a conceptual fucking mess compared to Mathematica).

  12. Very true - kids gone by Duncan3 · · Score: 1

    It makes sense because that's about the time the kids are gone, and they can devote time to their passion again.

    After all the whole fuel of the 20-something startup is that you do not yet have spouse/kids/life to keep you from working 80+ hour weeks. This is called a "youth culture" but really just means you don't know you're supposed to be enjoying life.

    --
    - Adam L. Beberg - The Cosm Project - http://www.mithral.com/
    1. Re:Very true - kids gone by CastrTroy · · Score: 1

      I do and don't agree. It seems like everybody is just waiting until they are really old to start having kids. A lot of people wait until they are 35 now. Myself, I'm 27 and have 2 kids. I really enjoy having kids, and it's nice to have enough energy to keep up with them. I also look forward to the future when they leave the nest, and I am still young enough to enjoy life. Not that I'm not enjoying life with kids. But they do limit how much free time you have for doing stuff on your own.

      --

      Anthropic principle: We see the universe the way it is because if it were different we would not be here to see it.
    2. Re:Very true - kids gone by iamacat · · Score: 1

      It makes sense because that's about the time the kids are gone, and they can devote time to their passion again. So I have to wait until 55 to start a company. Shit! And I here thought I am a couple of months away from initial product release. Provided of course that my daughter doesn't burp on my MacBook Pro at an inopportune time.
    3. Re:Very true - kids gone by Duncan3 · · Score: 1

      I never said it wasn't possible, but kids do take a lot of time. Time that's a lot more fun then sitting at a desk, that's for sure :)

      --
      - Adam L. Beberg - The Cosm Project - http://www.mithral.com/
    4. Re:Very true - kids gone by Eli+Gottlieb · · Score: 1

      Yeah, the way people wait so long nowadays just seems very weird to me.

      Then again, maybe that's because my parents waited until they were 34 and 45, and my brother and I both have various horrible allergies.

      And now my mother is going through menopause while I'm in college. Oy gevalt.

  13. No shit by Bombula · · Score: 1
    As if this wasn't totally obvious. You hear about a handful of successful entrepreneurs who are very young, without hearing about the thousands of others who are very young who fail. The success ratio for extremely young entrepreneurs is abyssmal - no better than chance. Dot-coms are an exception, but that time has come and gone, and many of the dot-coms that have endured and actually achieved long-term success were NOT started by young kids in garages or basements; certainly, even more of those that are successful have become so because more experienced management was brought onboard early enough to keep the companies working.

    As for actual technology companies, as in those innovative businesses based on applied sciences, they are unlikely to be started by people who are not accomplished in their various scientific disciplines. Computer science is still something of an exception, but it won't stay that way for long. Look at biomed, for example. How many successful biomed start-ups are done by undergrads in their dorm rooms? Zero. That's because you actually have to be trained and educated in a mature field in order to bring something new to biomed. Not so for computers - particular software - but that will not remain the case for long.

    --
    A-Bomb
    1. Re:No shit by bladesjester · · Score: 1

      Not so for computers - particular software - but that will not remain the case for long.

      I disagree. There are a couple of reasons for software startups still being the domain of even the "dorm room duo" for a long time to come.

      1) Low barrier to entry - All it really takes is hardware (whose price has been decreasing) and some software (much of which is free as in cost). You can literally start a software startup on a few grand (if even that) and keep it funded by doing consulting on the side.

      Biomed, on the other hand, has very high barriers to entry because it requires a *lot* of equipment (not to mention lab space).

      2) Software is relatively easy to learn/fix by playing with. You can make incremental changes to what you're writing and test it out very quickly. The only really "lost" time is time spent in compilation so the turn around time is insanely fast unlike the old days when you had to submit a job and wait until the next day to get the results.

      Add to that the fact that anyone with a couple of books (or an internet connection) and a computer can pick up a language and get started if they really want to.

      You don't get that sort of thing with physical sciences.

      --
      Everything I need to know I learned by killing smart people and eating their brains.
    2. Re:No shit by Anonymous Coward · · Score: 0

      That and a lot of 12 year olds have their own computers to learn on. Not so many have chemistry /bio labs.

    3. Re:No shit by Eli+Gottlieb · · Score: 1

      Yeah, but how many comp sci undergrads know enough actual computer science to successfully figure out a clever, sale-able solution to a problem that someone actually needs solved?

      The "undergrad entrepreneurs" that *I* know are just a bunch of kids in 100-level classes who are trying to start a gaming studio. Admittedly, they seem to be making progress on a game of some sort, and all the best luck to them, but I don't see how they're going to compete in the market with some product of one or two years' undergrad comp sci education.

      Come on, Citadel Studios, prove me wrong!

    4. Re:No shit by bladesjester · · Score: 1

      Yeah, but how many comp sci undergrads know enough actual computer science to successfully figure out a clever, sale-able solution to a problem that someone actually needs solved?

      A number of my friends and I were writing code for organizations and getting paid for it (both as employees and on a consultant basis) when we were still undergrads. Granted, we weren't necessarily "average" students, but people who pull off starting a successful company generally aren't.

      --
      Everything I need to know I learned by killing smart people and eating their brains.
    5. Re:No shit by Anonymous Coward · · Score: 0

      Du bist lustig!

    6. Re:No shit by kninja · · Score: 1

      Biomed is actually expensive because of the FDA certifications and multiple phases of clinical trials you have to do to actually get something to market.

      The training and equipment costs usually pale in comparison to the clinical and approval expenditures.

    7. Re:No shit by Eli+Gottlieb · · Score: 1

      Oh, I'm not saying that some smart comp-sci undergrads can't write real code and get payed for it. The CS department here tells all its students to have their first internship or whatnot doing just that by the summer after sophomore year.

      I just think that, more than other industries, computing encourages almost everyone with an idea and far too much coffee to make a go at a startup company.

    8. Re:No shit by bladesjester · · Score: 1

      You're thinking of "startup" in far too narrow a scope. Most people do.

      You don't just have to have one product. Any new software company is a startup, really, including consulting companies.

      Personally, I think the experience you gain in a startup is extremely useful because you learn not only about the technology but about business as well. Unfortunately, some companies in the Midwest disagree, because they're too paranoid and think that anyone who has been on their own before will do it again at the drop of a hat, taking the company's client list (if there is one) with them.

      --
      Everything I need to know I learned by killing smart people and eating their brains.
  14. This just in... by VorpalRodent · · Score: 1

    Individuals with more life experience and education more likely to put said knowledge to use...
    News at 11!

    --
    Take it to the limit, everybody to the limit, come on, everybody fhqwhgads.
    1. Re:This just in... by ittybad · · Score: 1

      Good Jeeaaooooorrrrrrb!

      --
      No single raindrop believes it is to blame for the flood.
    2. Re:This just in... by VorpalRodent · · Score: 1

      I'd make an effort to correct your pronunciation, but I have this sinking feeling that it'd always come back as some variant of "Jorb".

      --
      Take it to the limit, everybody to the limit, come on, everybody fhqwhgads.
  15. makes headlines by 192939495969798999 · · Score: 1

    The only reason that there's a perception of the 20-something success is that it generates media attention when it works. There are way, way more young failures and older successes, but that's what we should expect to happen. The younger the kid, the less attention is paid to how successful their strategy is and the more credence is lended (for some reason) to their outrageous claims. Try to follow up on any of those 12-year old dot-com phenom types and see if any of them (or their parents) are still pushing headlines once they reach the age where their young age is no longer a media magnet, and they must compete directly with the more experienced folks.

    --
    stuff |
  16. Wunderkinder by Reality+Master+201 · · Score: 4, Funny

    Das Wunderkind, die Wunderkinder. Lernen Sie Deutsch!

    1. Re:Wunderkinder by Enleth · · Score: 1

      Ja, ja, Volkswagen!

      (Please excuse my obsucre reference to a probably-not-very-well-known Polish comedy "How I started the Second World War" - I just had to do that... To explain a bit: that's how one of the main characters responded to a Gestapo officer asking him a question, because he didn't know German at all.)

      --
      This is Slashdot. Common sense is futile. You will be modded down.
    2. Re:Wunderkinder by Anonymous Coward · · Score: 0

      they need to go to the _k_indergar_d_en first ;-)

    3. Re:Wunderkinder by Reality+Master+201 · · Score: 1

      Is that the one where the main character's gives his name to the Gestapo as Grzegorz Bry[something I have difficulty pronouncing despite speaking two other Slavic languages]?

      That's a funny one.

    4. Re:Wunderkinder by Anonymous Coward · · Score: 0


                                          ACHTUNG! ALLES LOOKENSPEEPERS!

      Alles touristen und non-technischen looken peepers!
      Das computermachine ist nicht fuer gefingerpoken und mittengrabben.
      Ist easy schnappen der springenwerk, blowenfusen und poppencorken
      mit spitzensparken. Ist nicht fuer gewerken bei das dumpkopfen.
      Das rubbernecken sichtseeren keepen das cotten-pickenen hans in das
      pockets muss; relaxen und watchen das blinkenlichten.

    5. Re:Wunderkinder by LeafOnTheWind · · Score: 1

      A German grammar nazi...

    6. Re:Wunderkinder by Reality+Master+201 · · Score: 1

      You know, I understand the colloquial American English use of the word, but in Germany, they reserve the term Nazi for a group of people who took over the country and murdered several million people. Maybe the word is better left to that usage.

    7. Re:Wunderkinder by Anonymous Coward · · Score: 0

      Oh look, a Nazi nazi. Where this trend has sprouted from here on /. I do not know, but it's lame.

      Get over it. The nazis aren't the only ones who killed a hell of a lot of people. So did the catholic church, a whole lot of people under the name of God or Allah or the friggen flying spaghetti monster.

      Not to mention all the jackasses in africa killing eachother off because they think their impoverished imaginary "race" is somehow better than another.

      Quite frankly, all people are terrible. All civilizations are violent. Hitler may have set a high score but it doesn't make him any worse than anybody else with blood on their hands.

      I'd post with my name and take the karma hit except that I don't intend to argue my POV against anybody else's because your view on this subject is directly related to your "religious" and moral views, and it's too big of a can of worms.

      In brief, however: I believe in the Christian God, but I am not religious, nor a traditional "Christian", nor am I an ignorant fundamentalist. I believe all people are equal in their lack of righteousness. It is my personal opinion that the only thing that separates me from Hitler in righteousness is that I am saved by faith in my God. As humans, we all have the same capacity for evil.

      -1, Troll.

    8. Re:Wunderkinder by Anonymous Coward · · Score: 0

      Yeah, "Wunderkinds" sounds so totally grating to German ears, it's kinda cute again how the English language managed to mangle, sorry, integrate this word. :)

    9. Re:Wunderkinder by Anonymous Coward · · Score: 0

      Far as I know it originated from someone being called a "Soup Nazi" in a Seinfeld episode, yes? Well, personally I've no problem with Americans using this term in its own context.

      It can't hurt though to be aware of the fact that outside of your own culture the term "Nazi" still may be perceived as rather strong and vulgar, and it could be quite embarrassing for you to use it. Think along the line of making references to the "Ku Klux Klan" and "nigger grammar".

    10. Re:Wunderkinder by Anonymous Coward · · Score: 0

      Zarathustra spake nothing of these Wunderkinder.

    11. Re:Wunderkinder by Anonymous Coward · · Score: 0

      Nein danke.

  17. Does that include patent troll companies? by Anonymous Coward · · Score: 0

    reveals most U.S.-born technology and engineering company founders

    A lot of the time, surveys don't distinguish between the productive companies and litigation engines. I can well believe people founding the patent-troll kind of "technology and engineering" company are mostly middle-aged greyhair scumbags looking to effectively tax the generation of young real innovators the US patent system oppresses.

  18. If you want a place to start one, try Ohio... by Anonymous Coward · · Score: 0

    Because there are no tech companies in Ohio. Want proof? Google "tech companies in Ohio" (with the quotes) and you get:

    1 result.

    Googling "IT companies in Ohio" yields 4 results. Most are outdated and useless info, as this market dried up back in the 90s. There are a lot of universities around here, but most people attempting to get into tech jobs either leave the state or change careers altogether. There is a lot of untapped potential here that is just waiting for a good start-up.

    --
    My proof-you're-not-a-script image is "optimism." How appropriate.

    1. Re:If you want a place to start one, try Ohio... by Anonymous Coward · · Score: 0

      But then you have to live in Ohio.

    2. Re:If you want a place to start one, try Ohio... by Metasquares · · Score: 1

      Yeah, but then you have to live in Ohio :)

    3. Re:If you want a place to start one, try Ohio... by metamechanical · · Score: 1

      I live in Ohio (in the greater Columbus area), and face this issue myself. I followed a significant other here, because the market for their skills is much more in demand here. Unfortunately, I'm now stuck to a job which I don't care about at all, and can't find another in the area. So what do I do? Do I start my own company? I've thought about doing that, but I am yet young, and unwise in the ways of the world. Do I keep looking? Jobs are rarely posted, and unfortunately I have yet to find any professional engineering societies locally to network with people. If I caught wind of a local tech start up, I know I for one would flock to such an opportunity.

      --
      If I had a nickel for every time I had a nickel, I'd be richcursive!
  19. Well duh. by Estanislao+Mart�nez · · Score: 1

    Of course nobody reports that. It's not news!

    --

    Are you adequate?

  20. FOGEEZ Ahoy! by Dextrously · · Score: 1

    They were on the roads, driving 45 in the fast lane with their left blinker on, now they're leading our companies! Great, lets hope to retire them someday!

    *ducks*
    AHHHH! Anything but the cane! *cowers*

  21. Been there, done that... by Kjella · · Score: 1

    ...and it's not an experience I'd be without, but god how clueless we were in some areas. I think most young start-ups that survive do so because noone has told them how difficult what they're doing is so they do it anyway. That also means many run into all the pitfalls littered with other companies they should have learned from, so I think they got the most failures and the most spectacular successes.

    The only reason there is a dip that rebounds later is that parents with small children rarely want to do a startup. High risk, long hours, work crunches and stress doesn't combine quite so well, so it's usually either young people with nothing to lose, or people in their 40s with teenage kids that can stand fairly well on their own.

    --
    Live today, because you never know what tomorrow brings
  22. Popular believe distorted by mass media. by v(*_*)vvvv · · Score: 1

    Just another prime example.

    "Smart looking man launches company based on his education" doesn't make it to the press but "young geek strikes it rich" will. Without real surveys of the entire industry what really goes on is never revealed. Only the extremes come to light.

    The truth is often boring. That is to say making it interesting will not make you any smarter. It makes you a liar.

  23. Get the hell out of my way! by gr8scot · · Score: 1

    "Because entrepreneurship is an indicator of economic vitality in regions and across the country, this study raises important policy questions about how to foster greater tech entrepreneurship to boost economic growth," said Robert Litan, vice president of Research and Policy at the Kauffman Foundation. "Probably the most compelling fact in the study is that advanced education is critical to the success of tech startups." That is all.
    --
    All 19 hijackers were known terrorists 09-10-2001. Lack of FBI intelligence does not justify warrantless wiretaps..
  24. The first couple of people by sentientbrendan · · Score: 1

    in a startup might be relatively young, just out of college and willing to take risks. However, as soon as that startup gets enough funding to hire some more employees and pay them a salary, they aren't going to go after other college grads with limited experience.

    Funded startups typically go after top tier developers with lots of experience to get their product off the ground. They need these guys because the challenges a startup faces are huge compared to the number of people and infrastructure available. Also, they can actually get top tier people by
    1. offering them top dollar.
    2. offering them lots of pre-ipo stock
    3. last (but not least) giving them something really challenging to work on.

    Only the first few employees can be expected to work for free, so these more experience guys that come later actually aren't taking that much of a risk, as they still get their higher than usual salary, plus stock, which is just gravy if it pays off.

  25. I'm living proof by RogueWarrior65 · · Score: 1

    I started my first business out of total frustration with working at a Fortune 500 company who made politics instead of product. It wasn't a huge success but it earned me a lot more money and lasted a good 10 years. And it enabled me to start my second business. Never forget that the B students work for the A students at companies started by the C students.