Is it easier for millennials to start their own businesses than it was for previous generations? And what are they like in the workforce? Claire Connell finds out the buzz on millennials in business.
Experts say New Zealand’s startup scene has really come of age in recent years. Through business accelerators that provide entrepreneurs financial support and encouragement, there’s a viable platform for Kiwis with bright ideas.
New Zealand’s startup scene
Robbie Paul, chief executive of Ice Angels, says millennials have more entrepreneurial spirit than previous generations because there are more opportunities.
The Kiwi culture of entrepreneurship, the investment community to back them, and the supportive environment, are all in their favour, Paul says. There’s also easier access to international investor networks.
Graeme Muller, NZTech’s chief executive, says if you walk around places like startup nurturing space Creative HQ or co-working spaces like Generator or BizDojo, “by and large, they would be in their 20s and 30s, not 40s or 50s”.
Founders under 30 only
Two years ago, First Cut Ventures was set up, specifically to invest in the business ideas of founders aged under 30.
Robbie Paul says these young people are closer to innovation, they’re less risk-averse, and they’re more efficient with their capital.
“If a 40-year-old starts a business and has two kids and a mortgage in Auckland, then there’s a baseline they need to be paid. But if you look at the founders we’ve backed, they can live at home and spend a fraction of that.
“When you’re an early-age startup, burning capital and not generating revenue yet, expenses can cost you a lot,” he says.
Are the stereotypes true?
Muller believes negative attitudes against millennials are generational. People don’t tend to look down favourably on a younger generation.
“I’m Gen X, and the exact same conversation was happening when I was entering the workforce, 20-odd years ago. Each generation doesn’t want to stand still, they want to do things fast.
“I’m sure when these millennials are CEOs of businesses, they’ll be complaining about that new batch that’s come in and expect all these fancy technologies.”
Start a business for the right reason
But even if the climate’s made business easier, it’s still best younger people who have an idea for a business start it for the right reason.
Paul says: “I don’t think there’s any harm in the sense of urgency that millennials may have, and the desire for autonomy, that drives them to start their own business. But it probably doesn’t do anyone
any favours thinking it’ll be an overnight success story or a get-rich-quick scheme, because that’s not the case.”
Your own business is hard work, can be risky, and takes time, experts say.
You might need to change it up
Kevin Whitmore, a business innovation expert at Callaghan Innovation, says young people with a business idea need to be open to change.
“Too many times, people come straight to a solution, and then retrospectively try to apply a problem. But people need to think through the problem first, to make sure they don’t jump to a solution that nobody needs.”
He often sees people come into startup accelerators with an idea, then leave with a revised, or completely new, concept.
“It’s about learning, developing and pushing forward with a concept that takes them through to delivering a sample product.”
How to manage millennials best
Millennials generally pick up things fast, they’re adaptable, and comfortable working in a fast-paced environment, says Madison Recruitment’s general manager Christian Brown.
They’re open to challenging the status quo, as well as challenging their manager. This can sometimes be misinterpreted as not respecting hierarchy, Brown says, but millennials view respect as something you earn, rather than a matter of right.
He offers these tips for managing staff if they’re under the age of about 37.
· Give them regular feedback, but expect them to move on in a year or two.
· Give clear role expectations. Make sure they know they won’t be the general manager within a year, but give them a pathway for moving up within the company.
· Allow flexible working conditions where possible.
· Challenge them with other options.
· If they want to step up, get them working on side projects to broaden their skill set.
· Pair them up with an older, experienced mentor. This will bring benefits to both parties in terms of understanding between generations.
What about Gen Z?
Resilience, creativity, and critical thinking are some of the skills vital to an entrepreneur. And teenagers today are developing these skills, along with innovation and curiosity, paired with no fear of failure, says the head of the country’s Young Enterprise Scheme (YES), Dr Colin Kennedy.
YES has been teaching Kiwi secondary students all aspects of creating a business for nearly 40 years.
These Gen Z students – one generation below millennials – are “true digital natives”, Kennedy says.
“They see things differently… A lot of them are going to bypass education and go straight into the workforce.
“They’re big multi-taskers and they’re very competitive. The current entrepreneurial mindset and ecosystem suit them better than it did the millennials.”
He sees many technology-based businesses coming through the YES programme.
One growth area is ‘drop shipping’, where a company promotes an item from a store like Amazon, and gets commission from sales.
Other recent projects have included technology to track and activate a car key (great for parents), and using recycled laptop lithium batteries to power electric bikes.
First published 23 November 2018
Story by Claire Connell
This article does not contain any financial advice and has not taken into account any particular person’s circumstances. Before relying on it, we recommend you speak with a financial adviser. This story reflects the views of the contributor only. Content comes from sources that we consider are accurate, but we do not guarantee that the content is accurate.