By successful, I mean, you earn decent enough income to live just as good or better than what you did on a day job.
The mortgage isn't going to pay itself with my dreams.
The disadvantage of a mortgage is that you generally have a longer term investment, which makes you less mobile - although the truth is you have more assets and it's a liquidity problem (you'd have to sell your house to get anything out of it). The risk there is that you'd have to sell in a down market if something bad happens to your job (or you, if you're the breadwinner).
There are other breaks you get - tax and otherwise. I never realized how rigged the system was until I bought a house.
For example, if you're a homeowner, you get a massive break on car insurance. The interest is tax deductible on your mortgage. You learn a little about money, and pretty soon you're negotiating harder for better deals - you become the ultimate ballbuster. You...Are...Dad.
YMMV.
However, I think losing your house is generally a seen as a huge public failure where some people can privately take loses that don't effect their living situation in stride
That's the secret sauce that's super hard to get right. I think most people who FELT CONFIDENT they had a brilliant idea and FELT CONFIDENT the could execute it -- would quit very quickly
The follow up questions are, what are the real risks?
Some people seem to be making an assumption that there is more risk as you get older. Risk isn't so cut and dry. Certainly you may have more risk as it pertains to your family. By the time I was 35 I was married with kids and a mortgage. Certainly there is more risk of changing your retirement. By the time I was 35 I had more money going towards retirement as well as retirement funds collected. By starting a business I was significantly risking those things.
Some people also make the assumption that young founders make better founders. By the time I was 35 I had worked for many companies and corporations, large and small. I had learned quite a number of business rules for myself and I had come up with a set of rules and patterns that worked in business. At 25 I did not have those experiences or that knowledge at all. I thought I did, of course, but I did not.
Over all I felt it was much less risky at 35+ to start a business and leave the day to day. But that was for me. I also found no problem at all jumping back into a day job if a business didn't work out. So it hardly seems like a risk at all.
For years, people have tried to correlate an entrepreneur’s age when they launched their startup, with the ultimate success of that startup. Many studies have been done on the topic, including reports by the Kauffman Foundation, Duke University and the Founder Institute, to name a few.
The collective summary of their learnings is: the average entrepreneur is 40 when they launch their startup. People over 55 are twice as likely as people under 35 to launch a high-growth startup. The average age of a successful startup with over $1 million in revenues was 39. Age was less of a driver to entrepreneurial success than previous startup and industry experience.
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Almost 40 here. I would definitely risk it, but on the other hand I don't have any kids or other responsibilities.
But I wouldn't quit my day job until I had a working produce and saw potential and good feedback.
I actually think of them as 3 separate things, not 2.
- Some people have lots of ideas, many of them terrible.
- Some people have the ability to evaluate whether an idea is good or not.
- Some people have the abilities to execute ideas, good or bad.
People can have [0,3] of these, but #2 is the rarest in my experience. And if you do have all 3, go do whatever you want, because we'll probably end up reading about you in the news soon enough.
Believe it or not, thousands of small businesses are started every year by folks in many different age brackets. Heck, the company I work for was founded by a 40+ year old entrepreneur.
Don't let the myth of the 20-something tech genius fool you. With age comes wisdom and experience that many a young founder could benefit from.
As for risk, risk is something you manage, not something that happens to you. Prepare, set a clear goal and definition for success, and be willing to cut your losses if you hit the end of your runway.
Save up a financial cushion and go for it, at any age.
I hope to be an example that you are looking for.
But I don’t believe my experience as described here necessarily says much for anyone else. The viability of a business is often easy to determine. I think the important considerations depend on the person making the choice. In simple terms, the key questions are about what someone values and what someone is willing to give up.
I enjoy working on my feet, making things with my hands, having relationships with my customers and coming through for them reliably and in ways they don’t expect. I take pleasure in the challenges that confront me (and the ensuing education from those challenges), I appreciate trying to teach and get more out of the (as of yet) one employee I have.
For all those positives and others, I’m comfortable going to work every day, I’m not bothered by the physical toll, and I am decent at brushing off the customer behaviors which can be infuriating. No, I can’t have the same social schedule as all of my friends, but I do see my local friends regularly and remain in good contact with those who aren’t nearby. My work definitely makes intimate relationships more difficult, but the ones I’ve had during this business didn’t fail because of my schedule but for other reasons.
At least in US culture, I think our careers are typically a form of self-discovery.* That’s not to suggest anything negative about anyone who doesn’t launch a business. But our work gives us good feedback on ourselves and our place in our world. In that framework, some of us are comfortable starting a business and some of us are not.
*I would have said any of the above a while back, but I also recently started reading the Studs Terkel book Working. It’s a collection of interviews with people about their jobs and how they feel about their jobs. From people in well-respected positions to those in positions often looked down upon, the themes shared about the value people derive from their work are illuminating and inspiring.
Book: https://www.amazon.com/Working-People-Talk-About-What/dp/156...
Some Audio Interviews: http://www.radiodiaries.org/the-working-tapes
I think that I have a better chance of paying attention to more of the important things with the current one, and letting go of the ego a bit more. We'll see!
I've only been someone else's employee for about 2 years out of my working life of about 30 years. What is this "risk" you speak of? B^>
Rgds
Damon
[The Truth About Entrepreneurs: Twice As Many Are Over 50 As Are Under 25 | PBS NewsHour](http://www.pbs.org/newshour/rundown/the-truth-about-entrepre...)
As far as risking my day job, that wouldn't concern me too much in today's economy. It's never in 20+ years taken me more than a 2-4 weeks to find a job. Once I saw the writing on the wall for my business and saw that I only had a month's saving left, I would shut down my business ad find another job. I wouldn't sign a long term lease for property until I saw the business was sustainable.
On the other hand, seeing how much headroom I still have in corporate America, the idea would have to be a great one for me not to just be a corporate drone.
If I were the sole provider for our family, nfw. There is too much out of your control, even if you are competent and have a good idea.
Simply incorporated myself and started earning 250k USD as a contractor.
It seems more risky to me to spend your most precious years in some awful open office shit hole.
Starting a business can be great for your career!
