Marc Lacoursiere –The change in business ownership once flowed almost entirely from traditionalists (1927-1946) to boomers (1947 – 1964). Today with so many generations active in the workforce, we are seeing successions across generations occurring in less traditional forms: from boomers to gen X’s (1965 – 1980) and to millennials (1981 – 2000). And there’s another twist: people 50 and older are less likely to be winding down, some foregoing retirement to start businesses.
The Opportunities from Living Longer
In 1880, an ethnically and gender-biased study put life expectancy in the US at about 50 years. Studies today suggest that a North American – regardless of gender or race – will live to 79 years. That’s a 58% improvement! We have added a year of life expectancy every five years.
So, the old question “what will you do after work” takes on a new meaning. People retire from their current careers looking for a new adventure. After all, a person over 50 could live an additional 50% of their life after retirement.
Love What You Do
People are appreciating that a “live to work” mentality gets in the way of opportunities to maximize quality of life. An article in Forbes titled Forget Retirement suggests that 42% of those who started businesses after 50 did so to pursue a passion. Only 15% made the leap due to being outsourced; the rest did it entirely by choice.
People are retiring or resigning, then re-inventing themselves, finding new opportunities which include business start-ups, franchise acquisitions, and purchasing existing businesses.
Succession Across Generations
Boomers make up 40% of business owners. In some cases, the age of ownership will decrease when:
- Ownership transitions from parents to children.
- The older business owner retires and opts not to be involved in another business.
We will also see situations where a new ownership arrangement will increase or maintain the average age of ownership:
- The re-invention scenario where older people choose not to retire but rather start fresh as an owner doing something new.
- The classic scenario where the incumbent owner remains with the business, perhaps with a minor stake.
With so many generations in the workplace today, it multiplies the scenarios for generational ownership and transition. Young or old, first-time owner, or serial entrepreneur. It’s an exciting time to be thinking about new opportunities, and there are a growing number of people who are open to self-employment.
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