Young entrepreneurs are not interested in establishing a single business and profiting from it handsomely; they have serial ambitions
Television programmes such as Dragon's Den, the rise of crowd funding, tech start-ups and much more besides have all contributed towards putting entrepreneurs in the limelight. There has been a lot said and written about small businesses and first-time entrepreneurs, but little research has been done on the rising phenomenon of serial entrepreneurship.
Coutts sees serial entrepreneurship - where entrepreneurs don't just cash in on their first business and hang up their boots - as a key to the success of the UK economy. In light of this, Coutts and the Centre for Entrepreneurs published the report 'Beyond the first business: the myths, risks and rewards of being a serial entrepreneur'. The report surveyed 135 UK-based entrepreneurs to provide an overview of the depth and extent of serial entrepreneurship in the UK.
Two main factors are driving the rise in serial entrepreneurs. First, millennials are widely challenging the notion that entrepreneurs retire after their first business. They are starting businesses younger - our research showed that more than half (57 per cent) started their first business by the age of 25 versus only 23 per cent of those aged 35 and above.
This group also had faster expectations to sell - we found 63 per cent of our younger respondents are planning to exit their current business within the next five years, versus 46 per cent of those aged 35 and over.
Second, longer life expectancy and a low interest rate environment means there is greater appetite among one-time founders to put their capital to work. They are looking to recreate the buzz of working in a fast growing business but, by their very nature, they are unlikely to want to work for someone else and in many cases, the thought of starting another business from scratch is too much. So they are looking to take more of a hands off approach across a number of companies.
Our research found that 80 per cent of one-time founders enjoy being immersed in running a business, which is true for only 55 per cent of serial entrepreneurs. Serial entrepreneurs are less likely to enjoy day-to-day business involvement. Instead, an increasing number of these seasoned business owners are considering other options, including mentoring a portfolio of companies, being non-executive directors or being angel investors.
Perhaps unsurprisingly, responses from serial entrepreneurs in the survey suggested they are less afraid of failure, with only 13 per cent saying they experienced this fear compared to 40 per cent of one-time founders. While more than two-thirds (67 per cent) of one-time founders acknowledged good fortune as a contributor to their success, only 56 per cent of two to five-time founders and 36 per cent of six-to-ten time founders did so.
Can't buy me love
One particularly interesting finding was that although growing wealth is one consideration for entrepreneurs, it is not the dominant motivation. Other considerations rank higher, such as growing a business (90 per cent), interacting with people (79 per cent) and contributing positively to society (73 per cent).
This helps shed light on why serial entrepreneurs are attracted by roles that allow them to share their knowledge and experience more widely to guide young entrepreneurs. A number of our entrepreneur clients participate in our mentoring programme for first time entrepreneurs. Over the past few months, we've seen some fantastic results with many developing solid business relationships. Some mentors are even considering investing in the businesses of their mentees - which would take their relationship to another level.
We should enable more networking opportunities for entrepreneurs to meet and share ideas. There is huge untapped potential for serial entrepreneurship and experience seems to be crucial to success. Unlocking that further could provide significant economic benefits.
Dylan Williams is managing director of Coutts