Whether it’s the lure of independence or more money in the bank, there are a host of reasons why people dream of starting their own business.
But many of today’s entrepreneurs – particularly the younger generation – have a different aim: to make a positive impact on society.
Nearly a quarter of business owners under the age of 35 consider benefiting society to be their main motivation, according to new research from HSBC Private Banking. These socially-minded millennials prioritise areas such as protecting the environment or taking practical action in their community over, say, building financial security for their family.
In contrast, only 11 per cent of entrepreneurs over the age of 55 are chiefly driven by the desire to create a social impact, the Essence of Enterprise 2018 report found.
Younger entrepreneurs know that their business cannot have the impact they want without sustainable growth
This growing trend for socially conscious entrepreneurship does not appear to be a barrier to commercial ambition, however. The report suggests the two go hand in hand: entrepreneurs who start their venture with the intention of creating a positive social impact are more likely to predict high growth for their company.
Stuart Parkinson, Global Chief Investment Officer for HSBC Private Banking, said: “It’s clear younger entrepreneurs want to do good, and we would be wrong to dismiss this as youthful idealism that will act as a brake on financial success. They know that their business cannot have the impact they want without sustainable growth, and they are focused on achieving both.”
HSBC’s report, now in its third year, explores the motivations and ambitions of more than 3,700 entrepreneurs in 11 countries and territories around the world.
Investing in others
The research also points at a trend among young entrepreneurs to engage in angel investing – helping other start-up businesses to grow by investing capital and sharing their own expertise. Fifty-seven per cent of business owners under 35 have undertaken this type of investment, compared with 29 per of those over 55, according to the survey.
Attitudes towards angel investing also differ between the generations, with young entrepreneurs more likely to view it as an opportunity to connect with other business leaders and investors in their peer group. Older business owners see it more as a way to diversify and grow their investment portfolio, the research found.
Read more about the Essence of Enterprise report on the HSBC Private Banking website (opens in new window) .