It might seem an obvious conclusion to draw, but it’s still worth repeating: people who have a go at running a business during their student days tend to have a much better chance of setting up a successful company of their own when they embark on a career.
Entrepreneurs who make their first foray into business during their school or university days almost double their chances of becoming their own boss once they get out into the working world, according to a study carried out by Kingston University Business School in the UK.The study was commissioned by the business education charity organisation ‘Young Enterprise’ to mark its 50th anniversary in 2012.Having scrutinised the careers of 371 people who participated in the Young Enterprise programmes in the UK over the last thirty years, the author of the study found that teenagers who have had the chance to set up and run a real business from the classroom are almost twice as likely (42%) to become company owners than those who have not (26%). Guilhem Bertholet, former startup Incubator Manager at the Paris Business School-HEC Paris- and co-founder of welovesaas, believes that “the situation is comparable to that of a sportsman or a musician. The earlier you start a career, the greater your chances of succeeding,” he told L'Atelier. Marie Ekeland, a partner at Elaia Partners, an independent investment company specialising in the digital economy, agrees, insisting that the earlier a person is exposed to the ‘entrepreneurial adventure’, the easier it is to demystify the risks.
Young innovative companies
Nevertheless, we should not exclude the ‘virtuous circle’ syndrome, which often means that when a person sets up a company, whether it’s a success or not, s/he will want to go on setting up companies and keep pushing forward. “This cycle gets stronger as you get older and isn’t necessarily anything to do with having run a business in your student days,” argues Marie Ekeland. The Kingston University research also showed that companies run by former Young Enterprise participants are more likely to be innovative than other small businesses in the country. This could be the result of a mindset which encourages greater freedom to try out new ideas without inhibitions or pre-conceived ideas. "These entrepreneurs have no hang-ups and don’t just follow the current model. They’re therefore more innovative in the way they go about things,” adds Guilhem Bertholet.
The research reveals that, as well as being more innovative, companies set up by Young Enterprise alumni also have higher turnover. Thus 12% of the ‘alumni’-run firms are turning over £500,000 a year compared with only 3% of the ‘control group’ of non-alumni businesses used as a comparison.Although the report does not specify the failure rate for alumni companies, we can suppose that the entrepreneurs who start young are likely to be less risk-averse. This kind of initiative tends to foster ambitious entrepreneurs in the UK. In France however the situation is quite different, points out Marie Ekeland. “In France we suffer from a real lack of entrepreneurial spirit; and this doesn’t encourage creativity and innovation,” she says, directly quoting from a recent report* on this issue by French businessman Philippe Hayat. Nevertheless, we should not leave readers with the impression that older or less experienced entrepreneurs are unavoidably destined to go down the drain. An American study, ‘Education and Tech Entrepreneurship’ (2008), reveals that the average age of entrepreneurs running successful companies is thirty-nine.
*Pour un New Deal entrepreneurial (A New Deal Needed for Entrepreneurs)