When you think of a small business owner, what comes to mind?
The hot-shot tech startup leader in Silicon Valley? The eco-conscious merchant selling eco-friendly products on Main Street? The attractive young woman and her diverse, young staff offering organic pizza and veggie burgers to their young and woke customers? That’s how many brands and the media portray today’s small business owner. But that portrayal is just not accurate. The reality is that of the approximately 30 million small businesses in this country, most of them are still owned by boring old men (like me) selling boring old products.
That’s the conclusion from a study released this month from financing firm Guidant Financial and the Small Business Trends Alliance, a research group. The study of more than 3,000 small business owners found that 87 percent of them are over the age of 39 and 43 percent of them are over the age of 55. Surprised? You shouldn’t be. The data dovetails with other reports from researchers at both the Massachusetts Institute of Technology and the Small Business Administration, which found that the average age of entrepreneurs starting a business is 45 years old and that the share of existing business owners over the age of 50 has recently increased from 46 to 51 percent of all small businesses.
Yeah, small business owners are old, and according to the Guidant study, 73 percent of them are also men. Not only that, but they also lean to the right. According to the study, 41 percent of the respondents identified themselves as Republicans as compared to 29 percent who say they’re Democrats.
As we enter the election cycle of 2020, this giant block of small-business-owning voters — who are mostly male and Republican — are also quite happy with the way things are going for their businesses. Seventy-seven percent of them ranked their happiness as “somewhat” or “very” happy and 76 percent of them said they’re planning on growing their existing location or opening a new one, despite staffing concerns.
“We continue to see historically low unemployment and with more jobs open then people seeking them — it’s become increasingly difficult for small businesses to recruit and retain top talent,” David Nilssen, CEO of Guidant Financial, said in a press release. “But, the data validates our experience which is that those who venture out on their own are generally happy, profitable and making a meaningful contribution to the economy.”
That doesn’t mean that everything’s so rosy for today’s small business owner. We’re challenged to find and keep good people in this environment of low unemployment and stiff competition from our larger competitors. We remained concerned about regulations and taxes, rising wages, health care costs and potentially higher interest rates.
But none of these statistics surprise me. My firm serves hundreds of small business owners and I speak to thousands of them at industry associations across the country every year. When I look out into these audiences, what do I see? Mostly men over the age of 50. They’ve been running their companies for years, even decades in many cases. They’re generally not from New York City or San Francisco. They are tire distributors, landscapers, roofers, parts manufacturers, contractors and gas station owners. They are running boring, unsexy businesses located in industrial parks and strip malls in small towns you’ve never heard of. Many still sign checks, drive American-made cars, read the newspaper and come in to work at 7 a.m. They are planning for retirement but still very much in the game. They buy and they vote.
These are the people who make up small businesses today, and even though it may be more politically correct for big brands and politicians to say that this audience is a diverse group of young, eager entrepreneurs from all ages, genders and cultures, the reality is that this is just not true. If you want to sell to small businesses — or gain their vote — it’s important to really understand who this demographic is and that demographic is boring, old men. Like me.
• Gene Marks is a CPA and owner of The Marks Group, a technology and financial management consulting firm that specializes in small and medium sized companies.