Thursday, September 4, 2008

Generational Differences in Entrepreneurial Activity

Are younger people more entrepreneurial than baby boomers?

Younger people start things using technology at the drop of a hat. Just tonight I visited the site of Nate Westheimer, a 20-something who has a simple site that combines video and text to promote his political views. Tech expression comes naturally.

But technology is a tool - it is not a business. Entrepreneurship is about creating value for customers such that they will pay for what you offer and return you a profit...thereby making your endeavor self-sustaining. Entrepreneurship primarily requires understanding the needs in the market. That is a synthetic kind of knowledge that comes with "time in" a field or market.

Some boomers are more likely to have the time in, the experience, to create profitable businesses. But not all have the entrepreneurial savvy to carry through their ideas. There is a special kind of support that I think could help those who see needs to convert those needs into businesses.

However, I think younger people, in their 20s and 30s, are pioneering the concept of lifestyle businesses, essentially a portfolio of activities that make a living, activities made possible by technology. Perhaps the most well-known (but highly debated) proponent of this concept is Tim Ferris, author of "The Four Hour Work Week." It's a great concept that boomers can learn a lot from as they consider creating more rewarding work after toiling in a job for years.

Nothing wrong with using technology to create interesting work for yourself! David Birch, a researcher out of MIT, calls that "job substitution." It's just plain not the same as entrepreneurship, which creates wealth for the owner, jobs for others, and fuels this nation's economic growth.

Talented people have always found ways to use their gifts. Now technology makes it easier to express them. It is less and less necessary to compress our identities into a single job when information technology gives us so many tools to express all that we are...whatever our business goals may be.

1 comment:

Anita Campbell said...

Hi Susan, I like your blog. Thought provoking.

The only thing I don't understand is how we moved from entrepreneurship being an individual who creates a business, to individual who creates jobs.

Me, I go with the classic dictionary definition of entrepreneur: "one who organizes, manages, and assumes the risks of a business or enterprise." Under that definition a single-person business is enough to be an entrepreneur. I don't see the definition as containing the word "jobs" in there.

I consider myself an entrepreneur, and my goal has been to build a business, not create jobs. The jobs come as an outgrowth of the business growth. But even before hiring anyone I consider myself first and foremost an entrepreneur.


P.S., Congrats on your wedding today! We'll bexpect a blog post or at least a Twitter update about it.