Members of every generation look at those that follow with a mixture of skepticism, criticism, admiration, and complete bafflement. It's just a natural human response and hardly a surprise.
The experiences and events that shape each generation are profoundly influential and distinct and play a role in forming their collective attitudes and behaviors. Generational expectations and approaches to work and career are primary examples of this. For instance, Baby Boomers prioritize financial rewards and seek the prestige of impressive job titles and perks like swanky offices and executive parking spots. Boomers are also loyal to their employers, and many consider lifetime employment with the same company a laudable objective.
Those in the Millennial generation — people born between 1981 and 1996 — have different attitudes and expectations about work. Loyalty to one employer is basically non-existent. According to a survey by Gallup, one-fifth of millennials changed jobs over the past year, and six in ten were open to new opportunities. Gallup's data found that only about three in ten Millennials are "emotionally and behaviorally" connected to their jobs. Building a small business as a Boomer looks quite different than being an entrepreneur as a Millennial.
The Emergence of Gen Z Entrepreneurs
Those in Generation Z were born between 1996 and 2012. While they share many experiences and attitudes about work and their careers with their Millennial predecessors, they are also distinct. Perhaps the most significant difference in how Gen Z looks at their future career path is their aversion to a long-lasting career with a large company. Self-reliant in ways that other generations have not been, Gen Zers overwhelmingly look to themselves as the primary source of income and job fulfillment.
About 62 percent of Gen Zers have started or plan to start their own business. There's a wide range of reasons why Gen Zers are so drawn to entrepreneurship. One is simply because they have seen firsthand some of the risks of pursuing a more traditional career path.
The oldest cohort of Gen Zers was around 12 years old when a financial meltdown prompted a steep and punishing Great Recession between December 2007 and June 2009. Over those 18 months, about 20 percent of employees lost their jobs. The ripple effects of the Great Recession were considerable, with a large portion of those who lost their jobs when the economy cratered, unable to find new positions with similar salaries and benefits. Watching parents and siblings get laid off and struggle to land new jobs obviously impacted Gen Z's perceptions of the fragility of traditional employment.
Even if Gen Zers weren't born when the Great Recession hit, or enough time passed for its lessons to grow a bit less acute, Gen Zers entering the job force in recent years received powerful new reminders of the importance of self-reliance. Just as many Gen Zers left college and started looking for jobs, the coronavirus pandemic triggered a rapid contraction of employment opportunities and global lockdowns of work, school, and social life.
As was true with other generations, the pandemic sparked questions among many Gen Zers about the wisdom of pursuing traditional career paths. In other words, the so-called Great Resignation prompted many Gen Zers to reconsider the work-life they want to build.
Technology Makes Entrepreneurship More Attainable
Adverse global events like COVID-19 aren't the only reason why many in Gen Z see entrepreneurship as the most attractive and fulfilling way to build a career. It also has become far more accessible for people to start a business today than ever. One reason is that it is relatively inexpensive to launch a new venture. A study conducted by Gallup Organization found that the average business startup required less than $10,000 in capital and that nearly three-quarters of new companies got up and running without any outside funding at all.
That relatively low financial barrier to entry helps explain why so many Gen Zers were able to launch so-called "side hustles" — money-making ventures that are not full-time jobs and usually spring out of a person's hobby or passion — during the pandemic. The fact that it's financially viable to start a new business is connected to the inexpensive platforms and technologies that make it affordable and effective for Gen Zers to create, market, and grow their enterprises.
For example, in the past, digital entrepreneurs had to come up with enough money to pay for servers, web design, and other essential services to get a website with e-commerce functionality up and running. Today, however, there are low-cost or free digital tools aplenty. Gen Zers with a passion for magic or music or gaming or bikes or making crafts can market their products and services on YouTube, Instagram, TikTok, and other social media platforms — and tap into low-cost e-commerce platforms and payment apps to handle orders and transactions.
For those in older generations, the plenitude of technologies available to start and grow a business is an intimidating morass, more likely to cause confusion and frustration than to accelerate an entrepreneur's efforts. That is by no means accurate for Gen Zers. This generation has grown up with technology playing a central role. Indeed, Gen Z spends an average of 11 hours on their mobile devices and streams videos for 23 hours each week. As a result, they are inordinately comfortable using digital technologies — and familiar with how to use technology to self-promote and build a new venture's brand.
It also doesn't hurt that Gen Zers are smart. According to a study by the Pew Research Center, Gen Z is the most educated generation yet, with nearly 60 percent pursuing college. By comparison, about 44 percent of Gen Xers were headed to college in 1986 and 53 percent of Millennials in 2002.
Skills Needed for a Successful Entrepreneurship
Budding Gen Z entrepreneurs have an enormous amount going for them: They're eager to chart their own path, see small business creation as a way to build wealth, and have the technological skills and aptitude necessary to start and build a business with relatively little funding.
But anybody who has successfully launched a small business knows that turning even the best idea into a viable and long-lasting company requires a bewildering array of skills. Here are some tips for Gen Z business owners to build the most critical skills needed to turn their dream of building a business into a reality. Some of these skills are specific to younger entrepreneurs, while others are core to the success of anyone hoping to develop a new business.
Seek out a Mentor
Supreme confidence is a certain quality that all successful entrepreneurs require. Belief in the value of the company you're building is essential to overcome the inevitable setbacks that come from building products and services, acquiring customers, and securing financing. While confidence is critical, it also needs to be informed by a reality that applies to all of us: We don't know everything, and we can benefit enormously from the guidance and advice of others who have already done the hard work to launch and grow a business.
Fortunately, many Gen Z entrepreneurs understand the value of working with a more experienced mentor. One recent survey of Gen Z entrepreneurs, for example, found that over 60 percent wanted mentorship about how to scale their companies as well as direction around the financial and legal nuances of small business ownership.
There are many resources entrepreneurs can take advantage of to find a mentor. Those who are still in school can seek out the insights of a business professor or advisor. SCORE is a network of retired executives from any industry who can provide free mentorship in subjects relevant to entrepreneurs, from business planning to finance to human resources.
Given Gen Z's comfort level with technology, it shouldn't be surprising that many are pursuing mentorship in online communities, like Reddit, or enrolling in MasterClasses about entrepreneurship. If you're more established in your career and a Gen Zer seeks your help, remember that they might be doing you a favor. Indeed, Harvard Business School's James Heskett makes the case for reverse mentoring, where Gen Zers deliver their insights and perspectives about technology to their elders. Heskett relates the story about how legendary General Electric CEO Jack Welch got such value by soliciting the input of younger employees about personal computing and the Internet that he basically mandated other GE executives to do the same.
Develop Strong Finance Skills
Ultimately, the success of any small business will be determined by dollars and cents. A company has to make money. And when it comes to finance, entrepreneurs have a lot to learn.
For example, do you know what a balance sheet is and how to decipher it? Can you calculate the return on investment (ROI) of your company's spending? Without these skills, entrepreneurs risk squandering valuable capital that can keep a company operating and growing. A best practice for young entrepreneurs is to forge a strong relationship with their banking partner. The right banking partner can help small business owners elevate their understanding of important financial topics and questions. Just as important, a banking partner can help young entrepreneurs secure the right financing at every stage of their company's growth.
Bolster Communication Skills
Every entrepreneur is ultimately a salesperson above all. It doesn't matter what industry their company is in or the role they think they're playing in their business; all entrepreneurs spend their days selling. Sometimes, it's selling a product or service to actual new customers. Other times it's selling a potentially valuable new employee on why they should join your venture. Or it can be selling investors on the unique value a business can create and why they would be wise to back you with their dollars.
As the first generation to grow up with smartphones and everything digital, Generation Z has unique communication preferences. In a survey conducted a few years ago, 65 percent of Gen Zers say they prefer to communicate digitally rather than in person. The same survey found that 70 percent of Gen Zers sleep with their phones within reach, and almost a third think it's acceptable to text while in the middle of an in-person conversation.
Successful Generation Z entrepreneurs will understand that their own communication preferences are not shared by all other generations — and may, in fact, actually offend potential customers, suppliers, and investors. Savvy Generation Z entrepreneurs will take the time to learn the communication preferences of other generations and tailor their choice of communication channel and how to communicate accordingly. Baby boomers, for instance, prefer face-to-face discussions and will likely not be thrilled to get a business-related text full of emojis (which would probably be just fine if the recipient is a fellow Gen Zer).
Simple online research can give entrepreneurs the insight they need to communicate with customers, employees, and investors effectively. This is also where direction from good business mentors can help. Besides helping guide entrepreneurs about what types of communication resonate with different generations and what falls flat, mentors can also provide invaluable guidance about what is important in various flavors of communication. Negotiations, for instance, demand a unique communication approach compared to a sales pitch.
Management Skills That Build a Great Company Culture
Generation Z cares a lot about company culture. In a recent survey by the consulting company Deloitte, nearly one-quarter of Gen Zers said they chose to work for their current employer because they offered a positive corporate culture. Overall, an appealing corporate culture for Gen Zers means that a company is committed to more than just making as much money as possible and also values equality, environmental sustainability, and other societal causes they care about.
As entrepreneurs, Gen Zers need to understand that they are leaders and need to build and cultivate the sort of corporate culture they prioritize. This comes down to management skills that are unique to Generation Z and timeless. For instance, effective leaders need to model the traits they value. Suppose an entrepreneur cares about empathy and transparency in their interactions with customers and colleagues. In that case, the message they send by acting with those values in mind will send a powerful message – an equally powerful negative message will be conveyed when they behave in ways that violate those values.
A survey of Generation Z students provides insights about the kind of leaders they're likely to become. Many Gen Zers say they prefer a democratic leadership style in which organizations reach a consensus before making a decision. Almost as many students said, they embrace a leadership style that prioritizes the emotions and well-being of others. What is also clear from the survey is that virtually no Gen Zers think that a traditional command and control leadership approach in which senior leaders make all the decisions and don't solicit input is worthy of emulation.
Time Management is Everything
Entrepreneurs need so many things to be successful: They need money, they need good ideas and colleagues, and they need mentors, communication skills, and supportive networks. But most of all, entrepreneurs of all generations need more time.
Unfortunately, there are only 24 hours in a day, so making the most of those precious hours will go a long way toward determining the success or failure of a business venture. Translated, that means developing time management skills to ensure that a new company's most important tasks are addressed. There are many ways to develop effective time management skills. For instance, many entrepreneurs opt to schedule every minute of the day. This provides structure and control over how an entrepreneur spends valuable time and avoids the danger of multi-tasking and distractions dominating the day.
A significant benefit of scheduling each work day in advance is that it forces strategic thinking. Given the initiative's importance, is the 30-minute block devoted to planning a social media campaign enough time? Or perhaps a company's products and services aren't even developed enough to warrant their promotion, and every minute needs to be devoted to product development, recruiting, and fundraising? These are the choices that entrepreneurs will be making as they plan out each day. Other tips for improving time management include learning to delegate tasks that the entrepreneur doesn't need to handle alone and relying on technology tools to save time and enhance productivity.
Embracing the Entrepreneurial Journey
Generation Z can become known as the entrepreneurial generation. It starts with the simple fact that many Gen Zers view starting a business as key to achieving their career and personal goals.
But they have other built-in advantages that different generations have lacked. They are skilled in digital technologies and skills that companies of all sizes need today. And those technologies provide tools that make starting and growing a new company vastly more affordable than ever before.
As compelling as the advantages Generation Z entrepreneurs have, though, the reality is that launching a business that will last will always be a difficult challenge—only about 30 percent of small businesses survive for a decade. Upping the odds of success for Generation Z entrepreneurs means using the advantages they have and committing to developing the additional skills required to create a company that can last for generations. Learn more about starting your business with PNC's resources for starting a business.