Once upon a time, the only thing young people had on their mind when graduating from university was securing a great role with a leading organisation. But in 2015, many millennials are charting a different course. Rather than going to work for businesses, they are embracing their entrepreneurial urges at an early stage and setting up companies of their own.
Millennials may not have vast experience in business and commerce, but they are compensating for this in other areas. Their ideas, energy and technology nous are being put to great use in new, ambitious start-ups – enterprises that are breathing new life into communities and industry sectors across the country.
In a study conducted by Big Four giant Deloitte, 70 per cent of young people surveyed said they would opt to reject traditional business to work independently given the choice. It seems many are in a hurry to achieve their grand plans, to create and innovate under their own steam. In the digital age, there are various opportunities to do so, particularly online.
Although not every Gen Y business manages to establish itself and become profitable in the long term, many do. With a little drive, endeavour and good fortune, such companies can be hugely successful. Here are some of the reasons why they stand every chance of success:
1. The power of computers
Young people not only have powerful devices at their disposal, but they have the skills and understanding to harness their potential. Having grown up using technology from an early age, millennials know how to add value with IT, maximise its functionality and identify new areas of demand. Web-savvy twenty-somethings are ideally placed to ride the wave of ecommerce and take advantage of the vast opportunities available in the world of online business. They can use tablets, smartphones and mobile apps, and crucially, they understand what consumers want and expect.
2. Increased consumer savviness
Partly due to their comfort using technology, and in particular the world wide web, young people are very savvy consumers. They know what they want, where to get it and how much they should be paying. Also, they know where to look for – or leave – feedback, and appreciate the importance of social media from a branding perspective. The information available to young people online allows them to make more educated purchasing decisions in their own lives, and this can translate into shrewder business strategies when millennials set up their own companies.
3. Young role models
The success of other young people in business – like Facebook’s Mark Zuckerberg – has shown millennials what is possible with a little ambition. Those who have a vision and the drive to bring it to fruition can dream of a better life, one that offers fame, glory and financial reward. The existence of role models that Gen Y can identify with can provide the added impetus many need to commit to a life in entrepreneurialism. They have seen others succeed in this field, and see no reason why they can’t become the next success story.
4. Increased empathy levels
With millennials being so active online – and interactive with other people – many have high levels of empathy and human understanding. They understand how actions create reactions, and this feeds into their business strategies. Young business people tend to listen to their customers effectively, take feedback on board and use it to shape their product or service offering. Theoretically, this reduces the risk of failure when new lines are launched, giving the company a greater chance of standing on its own two feet.
5. A collaborative approach
Rather than opting to go it completely alone, many millennials are going into business with others, recognising the benefits that working in a partnership can offer. By bringing diverse skill sets and competencies together, many Gen Y entrepreneurs are building stronger companies which are more likely to be successful and stand the test of time.
This willingness to collaborate can be beneficial when millennial’s firms are ready to hire and build up their teams. Where business owners are prepared to accept input from their staff and give them an opportunity to actively contribute to strategic decision making, they are more likely to attract and retain talent. Everyone wants the opportunity to make a difference, and by being welcoming to ideas, business owners can keep their staff happy.
6. Availability of other finance options
In 2015, there is an increased range of options when it comes to securing finance for small business. New companies are not just reliant on support from the local bank manager – they can obtain the funding they need online via alternative platforms. The advent of crowdfunding, peer-to-peer lending, invoice trading and other types of alternative finance means there’s a greater chance of new businesses getting off the ground. The banks are gradually rebuilding their investment levels in small companies, but demand still exceeds supply on the whole. This means alternative finance has an important role to play is supplying the credit new up-and-coming businesses need.
7. Fewer options
In some cases, millennials have been pushed into entrepreneurialism through necessity, owing to a shortage of options in other areas. During the recession and ensuing economic downturn, many leading organisations implemented recruitment freezes, or at least drastically scaled back their hiring efforts. This meant many talented young people were left without jobs to go to, something which encouraged many to create their own incomes.
A few years down the line, many of the exciting new companies created when the economy was struggling are booming. They are creating jobs for other young people and making an important contribution to the UK’s long-term recovery.