It was clear from the 2017 SaaStr conference in San Francisco that technology has not lost its luster. In only its third year, the three-day conference was a huge hit with around 10,000 post-revenue software as a service founders, executives and investors. But at the same time it had identified some disparities, such as clear underrepresentation of female founders and CEOs.
While rare at 22 percent attendance, the female executives were still remarkably more visible than an almost extinct cohort: the over-50 tech executives. These “dinosaurs” appeared to be so rare that no one even dared (or cared) to take the statistical analysis of their presence (or lack thereof).
The only anecdotal knowledge of their existence was my own experience observing the busy hallways and energy-filled sessions and looking for my own kind. An occasional nod from a like species as a sign of mutual affection and understanding was accompanied by a sheer sign of strength, confidence and pure enjoyment, as if we already knew the end of the movie and all other participants were just watching the trailer.
Do Unicorns Need Dinosaurs?
Unicorns are startup companies valued at over $1 billion. By the latest analysis, there are 197 private tech companies valued at $1 billion or more (including whisper valuations). According to Fortune, at least a dozen of those would have a chance of making it to the S&P 500 list; an impressive feat.
It is well known (and celebrated) that 14 out of the top 100 wealthiest tech CEOs are under 40 years old. At the same time, the median age of a U.S. worker is 42. In Silicon Valley, that number drops to 31, according to Bloomberg. Even more remarkable, and to put things in perspective, less than 10 executives under the age of 40 are heads of non-tech Standard & Poor’s 500 companies, according to Spencer Stuart, while the average age of all CEOs at S&P 500 companies is 53, according to The Conference Board.
Is there an executive age bias in Silicon Valley? It is not due to age discrimination. A vast majority of tech firms are socially and culturally very liberal and pride themselves on diversity.
The best way to understand it is to look at how most tech firms get started and by whom.
In most cases, there is an identified, unfulfilled need that is subject to a “disruption of an existing solution” and it triggers a professional cognitive “juice flow” by either a young marketer, or (in most cases) a young programmer who believes they are placed on this Earth to solve that problem.
Those individuals are rarely busy running large organizations and are frequently either students, or employed by other young marketers or programmers whom they want to emulate or even one-up. Once the idea is born, they have the time and passion to drag their friends out of their jobs (or dormitories) and convince them to resort back to the college all-nighters in order to produce a prototype or launch the app so the initial capital can be raised and get the company started. Very few, if any, existing mid to large-company CEOs are going to do that (unless already retired from a previous financial windfall).
In most cases, the founder(s) end up not including a more experienced business executive in their early ranks, either as an adviser or, even rarer, as their boss. Here are the most common reasons as to why this practice is so rare:
- Twenty- to 30-year-old tech wizards are very self-assured and believe that their tech prowess or expertise in marketing to like cohorts will create products and market demand for the company to succeed on its own and within their own leadership.
- The technology evolves so rapidly that there is a common belief that if an executive is over 40, their ability to recognize, apply and leverage the most advanced techniques and tools is outdated and therefore rendered immaterial.
- Since most young founders have rarely held more than midlevel jobs at more established companies, there is a significant lack of mentoring and familiarity created between the two (sometimes three) generations of leaders.
The Case for Dinosaurs
So, are the young founders missing out? Why should they reach out to gray-haired elder statesmen and women? Here are three reasons:
- Experience. Older executives have seen the market cycles, funding fads and corresponding investor mood swings. They have, in most cases, already made operational errors in burn rates and know when to step on the gas and when to brake.
- Patience. As Rome was not built in a day, neither is a successful company. The best outcome for a growth company is to combine youthful exuberance with cautious optimism.
- Advice and confidentiality. Since few if any tech startups are created by a parent-child team, the next best thing is a synergistic, complimentary relationship of a visionary young founder and a mature executive whose personal interests for the partnership are diverse and business interests aligned.
Every aspiring Mark Zuckerberg and Nathan Blecharczyk ought to have a Warren Buffett or Sir Richard Branson in their executive suite. Because when they are planning to create that next unicorn, they may just need a dinosaur to sustain their dream.
Sasha Poljak is the executive chairman of Nimble Software Systems, creator of Ximble.com, a staff scheduling and time tracking app software platform deployed in more than 30 countries worldwide. Poljak is a seasoned entrepreneur and angel investor who has led strategy and market development in a number of successful tech ventures.
The post Unicorns, Meet the Dinosaurs: Leading a Fast-Growth Tech Company at Age 50 appeared first on Workforce Magazine.
This post originally appeared on Workforce Magazine
Author: <div class="author_list_wrapper"><ul class="author_list"><li class="author_link"><a href="/bios/sasha-poljak">Sasha Poljak</a></li></ul><div>