There is still time for members of the Millennial generation to hold the majority of the highest positions in established and emerging companies, but there is no denying that more and more young people are looking to start new projects (and right now, they are the largest generation in the workforce).
However, this generation has certain characteristics that define it and differ greatly from its predecessors (and therefore, also distinguish their way of doing business and running a company).
According to the 2017 HSBC Essence of Enterprise report, “Millennial entrepreneurs have an entirely different motivation than the generations before them. Rather than focusing on profit, they are driven to create a better world and have a more positive social influence”.
This is especially noticeable with 25 percent of 20-something entrepreneurs wanting to have a positive impact on their communities. Comparatively, only 13 percent of entrepreneurs in their 50s feel the same way.
Stuart Parkinson, Global Chief Investment Officer at HSBC Private Banking agrees: "We are increasingly seeing millennial entrepreneurs setting up businesses that balance financial returns with sustainability goals."
Fundera collected data and published these key findings about entrepreneurs:
- Millennial entrepreneurs have lower personal credit scores compared to Gen X and baby boomer business owners. But millennials have higher business credit scores than any other age group.
- Post-millennials beat out millennials in the revenue category, generating 61% more business income annually.
- Compared to older age groups, younger entrepreneurs are investing more resources into business expansion and business acquisition.
- Echoing a trend that spans across age groups, millennial business owners put more stock in traditional financing over credit cards.
- Over the last year, millennial entrepreneurs received an average of $44,729 in business financing at a 37.6% annualized interest rate.
According to data from the 2016 CEB Survey of Business Owners, “Millennials’ businesses have more employees compared to other generational cohorts: While some may think that younger business owners have not had the time to grow and add staff, half of millennial business owners have 20 or more employees. Compare that to just 30% and 14% of generation X and baby boomer/senior business owners, respectively”.
Another interesting fact that CEB Survey of Business Owners found out is that “Millennials are more likely to be swayed by social media: Conventional wisdom often has it that, as people spend more time online, they become cynical about digital marketing or learn to block it out, while inexperienced social media users are less discriminating. Yet, despite their greater usage of social media and other digital channels, millennial business owners are far from jaded about or inured to online marketing.
In fact, millennial business owners are more likely than business owners in other generations to be influenced by social media when making financial purchases”.