Recently we’ve been talking a lot about Olderpreneurs – a new term that’s popped up thanks to the rapid growth in older people starting businesses.
Competition for senior positions, more older people being made redundant, and simply wanting a bit of freedom after 40 years’ work, mean it’s no surprise that business ownership is an enticing option for lots of older people.
But how do you make the jump?
While there’s a heap of benefits to starting your own business it can also be risky, which is a scary prospect after 40 years of a guaranteed pay check each month.
Fortunately, older people are in a great position when it comes to starting a business which is why 70% of businesses started by older people last more than 5 years.
So if you’ve reached that point in life where you’re thinking about starting a business – here are some tips on how to do it.
Step one – Have an idea
After all, what is a business without a great idea.
Most of us have had an idea that we think would make a great business at one point or another – and by all means if you have that dream why not pursuit it?
However, if you’re a bit older you might only be planning to run your new business for 5 or 10 years so you’ll want something relatively secure and simple that you know will work.
Thankfully, there are plenty of options.
By now, it’s fair to say you’re an expert.
You’ve been doing what you do since before some of your colleagues were even born. There’s nothing you don’t know about your industry.
Why not make a bit of money from that knowledge?
Consulting is a great next step for someone to take after a career. You already have all the contacts and the know-how, you just need to find the customers.
Consulting is also a great way to wind down into retirement, as you can more or less choose your hours and just do odd jobs for the people you really like.
If you’re not quite ready for the world of consulting – why not try going freelance.
Going freelance lets you stay hands-on doing the work you love, but it gives you more control and flexibility over how and when you do it.
Thanks to freelancing sites like Upwork, it’s much easier now to find freelancing jobs than it was 20 years ago.
And who knows, if it goes really well you could end up hiring someone and running your own little agency.
Buying a franchise
If you’re not sure what you want to do when it comes to starting a new business, or if you’re a bit nervous about going it alone, then buying a franchise is a great option.
Franchises have a proven business model, and lots of franchisors will even help you with marketing and lead generation. After all, your success is their success so they won’t just let you crash and burn.
If you’re from a trade background, franchising is also a great option because you’ll find there are a lot of franchises available where you already know the job.
And now for something completely different
After a long career in an industry, you might want your business to be a completely fresh start.
Always wanted a to run a shop? Live the dream!
Always wanted an ice cream van? Save me a 99!
Even if you choose something totally new, you’ll still find that after a long career you have a lot of transferable skills.
From time management to knowing how to network and make good deals, a long career is a good background for starting any business.
Step two – Get the capital
Starting any business takes money – and it almost always take a lot more money than you expect at the start.
Fortunately for older people, you’re more likely to have access to the money you need (or at least some of it) to get your business off the ground.
Many older people will set up their business by taking some or all of their pension as a cash lump sum. The amount you can take as a lump sum will vary based on your pension scheme.
This can be a risky option (as if your business fails you’ve lost your pension) however if you don’t feel your pension will pay you enough for the standard of living you want, reinvesting the lump sum in a business can be a wise move.
Unfortunately, older people are the most likely group to be made redundant. However, a redundancy payment can provide some of the capital you would need to start your own business.
If a company must make wide spread redundancies, they will often offer voluntary redundancy first, which gets you a better deal.
If you’ve always wanted to start a business and your company offers voluntary redundancy, it could be just the opportunity you need to set up your dream business.
If you’ve been good and put a little chunk of every pay check into a savings account, by the time you’re in your 50s you’ll probably have a healthy bank balance.
While its important and prudent to have savings, you can’t take it with you, so why not invest some of your savings into starting your own company.
Re-mortgaging a property
If you don’t have the money to start a business and need to take out a loan, re-mortgaging a property can get you a much better deal than taking an unsecured loan.
While it’s always risky to re-mortgage (after all you could lose your house) as long as you make sure the numbers are right it can be a good option.
Step Three – Use your network
If there’s one thing older people will always have over young people in business it’s their network. After 40 years of work you’ll know a lot of well-connected people and important decision makers.
But, it’s not just the amount of people you know, it’s the quality of those relationships.
By the time you’re coming to the end of a career, you’ll have decades-long working relationships with some people.
These are strong relationships built on time and trust, and there’s no way to replicate that – which puts you in a great position when it comes to starting a business.
You can use your network in three ways when it comes to making a success of your new venture.
You can mine your network for clients, you can use your network to get more contacts and referrals, and you can use your network for advice.
Of these 3, it is the last two that are of the most benefit.
While there might be some people in your network who will fall into your target audience, after the first month or two they will all know about your service offering, and the amount of future sales you’ll be able to get out of them is limited.
Using your network to make more connections however is invaluable.
People in business are meeting new people all the time. If your connections have your business in the forefront of their mind when they’re meeting someone, they’ll be more inclined to say “hey – I have a friend who could really help you out” and recommend you.
For this to work you need to make sure people remember you. You can do this easily by being active on social media like LinkedIn, and by generally keeping in touch with people and attending lots of local events.
Finally, arguably the best thing your network can offer you is advice. Two heads are better than one, so imagine how much you can learn from everyone you’ve known over your career.
Whether it’s getting opinions on a new bit of software to breaking into a new market, you’ll be surprised by just how much information people offer if you just ask.
alldayPA – supporting business owners.
Hopefully this guide has been helpful to you and will help you on your way to becoming your own boss.
At alldayPA we work with small businesses every day, and we regularly create content and guides like this one to share helpful knowledge.
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