It’s 18.30 on a Wednesday in late August and the crowd on the fourth floor of London’s Aldgate Tower has a distinctly frantic atmosphere to it. Underneath exposed ventilation ducts and overlooked by screens reminding you of “meditation with Emma tomorrow” (well, it is a WeWork space), smartly dressed men and women clutch warm glasses of red wine as they anxiously make conversation. Everyone seems restless, circulating from one group to the next with brutal efficiency as they hungrily seek to connect with the right person in the room.
Is it a speed-dating night? Not quite, but it’s close. It’s an entrepreneurs and investors “meet-up”, part of a growing crop of events that provide space for people with ideas and people with money to meet, get a bit tipsy and, hopefully, strike it lucky.
Over the course of the night the 70 or so attendees patiently listen to three-minute pitches about a new proton therapy cancer treatment, a network of refilling stations for water bottles, machine-learning writing software for customer-service companies, a legal-technology platform for funding rounds and a computer program that instantly resamples vocal sounds as instrumental music. After it’s over, the room quickly reverts back to networking mode.
“Most venture capitalists in this part of the world are looking for million-dollar business-to-business companies,” says George Wright, with a sigh, as he scans the room. He is the 31-year-old founder of that voice program, Vochlea Music, and is looking for £200,000 (€222,000) as part of his second seed-funding round. “Angel investors are a different thing – let me know if you find any of those here!”
“There’s so much pressure to grow fast – we don’t want to raise too much too quickly or it won’t work,” says Richard Elmer. As the co-founder of Sipple he is taking on the bottled-water industry by building stations to refill on the go: the stuff from the tap is free or you can buy filtered and UV-purified water from 35p (40 cents). There are even Chilly’s-branded reusable bottles for sale in case you’ve forgotten yours. The firm has already raised £120,000 (€133,000) and is looking for another £75,000 (€83,000) to take it up until February.
Other than the cancer-therapy team, Elmer, a first-time founder at 44, is easily the oldest person pitching. He shrugs off the thought. “All the young people that get up are in technology. Anyone can set up something on a server from their bedroom – you need more experience to set up something bigger that requires infrastructure. I already work in a business; I can sit down at a table with 50-year-old plus investors. Age is an advantage.”
Who is the modern entrepreneur? This image of a middle-aged person running a relatively small-scale, slow-moving, do-gooding company feels a world away from the hoodie-clad, Silicon Valley technology whizz who’s focused on creating the next unicorn. Yet it is much, much closer to the truth of what the average company founder looks and acts like these days.
In the US, for example, that person is 42, according to a report in the Harvard Business Review. That figure rises to 45 when looking at the highest-performing companies (measured in staff growth). In the UK it’s 47, in Switzerland 39, Australia 42 and Japan over 45. You get the idea. (Perhaps less surprisingly, that person is also usually male, well educated and white – at least in western countries where data is gathered on the subject.)
These indicators are shifting to create a more diverse landscape but age is perhaps the least discussed – and therefore most surprising – part of the picture. “All of the emphasis when it comes to age is on the bad things,” says Wendy Mayhew, a 68-year-old serial entrepreneur who’s also a coach and speaker. Since 2016 she has run Wise – Seniors in Business, which provides support to those in her generation setting up businesses (Wise stands for wisdom, initiative, skills and experience). She also manages an awards ceremony called 50 Over 50. “I was asked to write an article on financing for older entrepreneurs in 2014 and I knew nothing about it. It’s only young entrepreneurs that you read about. I started researching it and realised it was the fastest growing group in the world but also the most underserved.”
She’s not wrong. As people work longer, want more from their professional lives, and the sanctity of lifelong corporate jobs fades, older people are striking out on their own. In 1996, about 38 per cent of entrepreneurs in the US were between 45 and 64, according to the Kauffman Index of Startup Activity. By 2016 that figure had climbed to 52 per cent. The same index showed that while the rate of entrepreneurship – how many new entrepreneurs there are each month – has declined in the 20-to-34 age bracket during that time, for anyone older it has risen. The European Startup Monitor found that between 2015 and 2016, the percentage of entrepreneurs aged 35 and older in the EU increased from 43.6 per cent to 50.5 per cent, with the figure for those over 55 nearly doubling.
With most major developed economies marked by ageing populations, it’s not a trend that’s likely to be reversed any time soon. “Nobody wants to talk about it but they’re all doing something and driving the economy,” says Mayhew. “I think senior entrepreneurship will become more pervasive.”
It feels self-evident that there are more entrepreneurs today than there have ever been. Surely even the concept of entrepreneurship is a modern invention? Not quite. “In some ways it’s always been around,” says Joe Carlen, author of A Brief History of Entrepreneurship. “One could argue that if there are resources being exchanged between tribes or peoples, there is some form of entrepreneurship. Let’s go back to Mesopotamia, which most people consider to be the cradle of civilisation. Back then it was about developing trade routes. Trading spices with the Indian subcontinent didn’t exist and then some entrepreneurs made it happen.”
Most people define entrepreneurship as creating or organising something new in order to capture more resources. Back in Mesopotamia that meant spices; today it mainly means money. For some there’s an extra layer to the definition that includes seeking growth and impact, which excludes freelancers and smaller “mom-and-pop” enterprises. Either way, the core idea is the same and, as Carlen’s book details, for millennia has been a powerful driver behind the development of human civilisation.
Yet while it may not exactly be a new concept, more people than ever are doing it. The potency of entrepreneurship has been growing ever since Austrian political scientist Joseph Schumpeter argued, in the 1930s, that such innovators were key contributors to the economy. Several decades later the explosion of Silicon Valley – and its many world-changing products and services – cemented the idea.
“Up until the early 1970s, entrepreneurs were people who were seen as slightly sketchy and outside the mainstream because they didn’t have a straight job,” says Marc Ventresca, an economic sociologist specialising in the subject at the University of Oxford’s Saïd Business School. “Part of the legacy of Silicon Valley, and our fascination with the technology world, is that 12-year-olds now say they want to be an entrepreneur instead of a firefighter. It’s become a recognised category of economic life and a plausible ‘career’. This is a big change.”
And things are still changing. Today being an entrepreneur is not just an economic activity: it’s also about engaging in some of the biggest challenges facing society, from the environment to healthcare and housing. “We’ve had an overly narrow view of someone making magic with technology,” says Ventresca. “I think we’re seeing a new era of entrepreneurship that is much more focused on solving problems for people. People like [PayPal founder] Peter Thiel and others are saying, ‘Surely we should be aspiring to more than another app to deliver pizza?’”
Cut to Lebanon, where a string of small-scale boutique hotels and guesthouses in carefully restored Ottoman houses host people looking to explore the country. All are run independently but bookings and their web presence are taken care of by L’Hôte Libanais. “Our mission is to help travellers get under Lebanon’s skin,” says Orphée Haddad, who founded L’Hôte Libanais in 2003 to promote slower, more sustainable tourism outside the big cities. “Each host, each piece of furniture and each homemade dish served at breakfast tell a story about Lebanon and its people,” he says. “We’re putting the spotlight on lesser-known destinations and making sure that residents are benefiting from the market.”
Haddad has succeeded in not just providing jobs and incomes for rural communities but also in helping to change the narrative around how to travel in Lebanon, making “going local” far more desirable. But it is also a business – and a profitable one at that. It has recently expanded into Syria, adding four hotels in Damascus to its roster, and is looking to grow in other “fragile” countries where it sees the opportunity to offer something different. “At the beginning we had an option of creating L’Hôte Libanais as an NGO or a company,” he says. “We chose a company because the goal was not only to do good things for the community but also prove that sustainable small-scale businesses can be profitable.”
If it feels like everyone is a social entrepreneur of sorts, that may reflect the way we now view our jobs: they need to be meaningful as well as providing an income. “There’s a general trend of people looking for purpose, either as an employee or by running their own business, and I see that continuing,” says Nicola Steuer, managing director of London’s School for Social Entrepreneurs. The school’s network supports about 1,000 people a year in the UK and internationally, and has helped launch or scale more than 200 start-ups in the past 12 months. It began 20 years ago in east London and has witnessed the growing interest in the field first-hand. Steuer says that social entrepreneurs are also driven by that desire to find opportunities to trade, sell and generate profit but with one key difference: “The purpose that sits behind it. Social entrepreneurs want social and/or environmental change and they have decided that an enterprising approach is the best way to achieve that and sustain it.”
Another reason entrepreneurship feels more meaningful is because it offers freedom from the more structured world of a company job. “It’s enabling and ennobling at a personal level, you create your own destiny,” says Ventresca. “Entrepreneurs are people who organise the world according to what they care about and believe in.”
In many ways Jan Garde is a typical founder. He ended up in hospital three years ago and found himself staring at the ceiling for days on end, wondering whether his cosy executive job with Deutsche Telekom was taking him in the right direction. Now 37, he is in the middle of his first seed-funding round for his new Zürich-based company, The Embassies, which aims to provide high-end, dignified co-living options for over-sixties (full disclosure: MONOCLE’s parent company has shares in it).
“I definitely see this as a purpose-driven enterprise,” says Garde, who has wanted to tackle the problem of depressing old-people’s homes ever since seeing his grandparents in one. “Just because we get older doesn’t mean we don’t care about quality of life. It’s partly coming from a deeply egoistic place. When we say we want to make things better for tomorrow, we mean we want to make things better for us for tomorrow. But there’s also a huge gap in the market – there’s an opportunity there.”
Money, obviously, remains a major motivation. But for most entrepreneurs today it’s far from the only driver. “If you want to start a business you have to feel so deeply about that problem you’re solving and connect to that customer,” says Nidhi Kapur, the founder of US bespoke direct-to-consumer furniture company Maiden Home. “I want to create a tremendous amount of value for my team, my investors and myself. But having done that for a few years, I believe it’s not enough to get you through the challenges associated with early growth companies. It has to be something deeper and more emotional for you. That’s definitely a pattern I’ve seen among fellow entrepreneurs.”
Yet all the purpose in the world isn’t enough if the conditions in a country make it difficult to set up or scale a business. Entrepreneurship obviously happens all over the world, from the streets of India to the Côte d’Ivoire, and you can argue that more economically challenging countries engender more entrepreneurial approaches out of necessity. It’s true that if you’re solely measuring the quantity of start-ups then African countries tend to come out on top, as a project started in the 1990s called the Global Entrepreneurship Monitor discovered.
But there’s another way to measure countries: the Global Entrepreneurship and Development Institute (Gedi), which seeks to look at the quality of start-ups by factoring in data about the country’s institutions, be it business freedoms, the ease of negotiating a contract or transparency. The results are very different. The top five countries in the latest ranking (2017) are: the US, Switzerland, Canada, the UK and Australia (see boxes).
“I think there are two things that matter for this index,” says creator Zoltan Acs, also director of the Center for Entrepreneurship and Public Policy at George Mason University. “Does the country let you do it and are the people smart enough?”
Acs believes the world is operating at about 50 per cent of its entrepreneurial capacity, with countries such as the UK closer to 80 per cent and others such as Egypt, around 40 per cent. “So then the question is: what should lower-scoring countries do? Gedi says we should have fewer start-ups, more people working in factories, better education, better rule of law and better protection of private property.”
The only thing missing from this calculation, he says, is any discussion of technology and, as a result, he is working on a new index called the Digital Entrepreneurial Ecosystem that will eventually replace the gedi. Yet the foundations he mentions for what allows larger scale, high-quality entrepreneurship to flourish are the same. It’s become a core area of focus for governments, most of which now have special policies in place to encourage start-ups, but it’s also increasingly important to established companies.
“A traditional corporation is [made up of] competing ecosystems,” says Philip Anderson, the Singapore-based director of business school Insead’s Centre for Entrepreneurship. “The one thing you need to do to beat the competition is attract the best entrepreneurs to your ecosystem. So even if you’re going into a traditional company, the ability to understand these entrepreneurs has become very important.”
As a result, companies are investing in what is being called “intrapreneurship” as a way of grabbing a slice of that entrepreneurial pie. For example, Unilever has The Foundry, which encourages collaboration with start-ups, and Deloitte has the Center for the Edge, which looks for fresh business opportunities. “If large companies do not find ways to foster this kind of entrepreneurship they will risk being trapped in a diminishing-returns business model,” says John Hagel, co-chairman of Deloitte’s Edge. “But fundamental transformation will be required. Leadership approaches will need to shift from a focus on having all the answers to focusing on framing powerful questions that can inspire others within the organisation to explore new areas of opportunity.”
It’s all part of the changing profile of the modern entrepreneur, says Hagel. “For decades we tended to think narrowly of entrepreneurs as people who were determined to build billion-dollar businesses with significant venture-capital funding. Now there’s a growing awareness that entrepreneurs may simply want to build very profitable small businesses with modest investment. There’s also that growing sense that large companies need it within their ranks to thrive in a rapidly changing world – this is no longer just about start-ups.”
The entrepreneur is dead. Long live the entrepreneur.
Best countries for entrepreneurship
The US Small businesses remain the backbone of US entrepreneurship. Half the private workforce is employed by about 30 million small businesses. However, President Trump’s nativist policies have hit entrepreneurship among immigrants, which has historically been a crucial economic driver. A start-up visa to attract global talent could help remedy this.
$19bn in venture-capital investment in Silicon Valley from 2017 to 2018, a 31% jump.
1,821 US-based businesses were launched by women each day in 2018.
6.3% of Americans (15.5 million people) identify as entrepreneurs.
Best countries for entrepreneurship
Switzerland Switzerland boasts extraordinary levels of investment in research and design (two of our favourite things). Excellent universities and technical schools help, as do world-leading infrastructure and a high quality of life. Access to funding means it is relatively simple to set up a business. However, enhancing the perception of entrepreneurship as a career option would be helpful.
3.4%of GDP invested in research in 2017.
99% of Swiss companies are made up of 250 people or fewer.
2% of businesses are closed every year, half for “positive” reasons.
Best countries for entrepreneurship
Small and medium-sized businesses make up half of Canada’s GDP and employ seven million people. Entrepreneurs can access CA$26bn (€17.5bn) of federal incentives, while prime minister Justin Trudeau’s Women-Entrepreneurship Fund is expected to double the number of female-led start-ups by 2025. Most federal funding still goes to cities so rural investment could be improved.
CA$38m (€26m) unveiled in August for young entrepreneurs.
CA$24m (€16m) for entrepreneurs through the Canada Music Fund.
300-plus immigrants have used the Start-Up Visa Program since 2018.
Best countries for entrepreneurship
The UK Ideal conditions for entrepreneurship in the UK are driven by the country’s digital sector, which has benefited from an increase in investment. There’s strong support for those who pursue their own business interests. More facilities that link entrepreneurs with academia and industry, such as Heriot-Watt University’s Global Research, Innovation and Discovery unit, would be welcomed.
£4.4bn venture-capital investment in the UK in the first half of 2019.
£39.4bn combined public and private spend on r&d in 2018.
1 in 5 people engaged in (or planning on) entrepreneurial activity.
Best countries for entrepreneurship
Australia Australia has one of the world’s most stable economies. Its citizens are some of the world’s richest and their readiness to spend indicates a ripe market for small businesses. However, government assistance only reaches 15 per cent of small enterprises. More state-led leniency on licensing and a shift away from the resource sector would sweeten the pot.
8 major government-support programmes for entrepreneurs.
33% of Australia’s GDP is from small businesses, which employ more than 40 per cent of the workforce.
43.5% refundable tax offset for R&D spending.