We’re told that we become wiser as we grow older, something that will certainly benefit any business looking to grow. But that’s not to say youth doesn’t also have its benefits. According to new research from Albion Ventures, the independent VC firm, young entrepreneurs have much more chutzpah and are more ambitious about their company’s growth prospects than their older counterparts.
The Albion Growth Report revealed that entrepreneurs under 35 are on average twice as confident about their company’s future than 45- to 54-year-olds, with 14% of young entrepreneurs maintaining that their firm would grow dramatically over the next two years, compared to just 8% of older entrepreneurs.
It seems young entrepreneurs are also more aggressive in their pursuit of funding, with 29% of millennial entrepreneurs having tried to raise their finance in the last year, compared to 14% of founders that are middle-aged. Despite this, the young are five times more likely to see their applications rejected, with 15% getting rejected over a two-year period compared to just 3% of more experienced entrepreneurs.
Perhaps as a result of this, the report also found that younger business owners were taking more risks to finance their growth, with 23% of under-35’s saying they have used their credit card to fund their business and 15% admitting they have mortgaged property. The older generation were not so willing to risk getting into debt for their business, as just 5% have put things on the plastic and only 7% have taken out a mortgage.
Whilst millennials appear to be more ambitious, when surveyed they admitted skills shortages were holding them back. According to the report, 23% indicated that a lack of mentoring was a major challenge to the growth of their business. A further 16% and 23% respectively said that better financial management and business planning would be beneficial. Meanwhile, 17% of young entrepreneurs claimed they wouldn’t mind exchanging equity for hands-on support, compared to just 7% of older entrepreneurs.
“The younger generation is by far the most optimistic and ambitious about the future,” said Patrick Reeve, managing partner at Albion Ventures. “This pro-growth sentiment is excellent news for the UK economy, as the under-35s will become increasingly influential over the years to come. The greater willingness of younger business leaders to use equity, rather than banks, to secure the funds they need suggests we’re shifting towards a more entrepreneurial model as seen in the US.”
So whilst young entrepreneurs might have the ambition required to create some truly game changing businesses, offering them better access to finance and mentoring will certainly help them along their journeys.