The age of those who start a business is gradually increasing, with 33% of startups now undertaken by individuals over the age of 45, according to the British Columbia Women’s Enterprise Centre, one of four centres in Western Canada that provide services to women entrepreneurs who are seeking to start up or expand small- and medium-sized businesses. Within those startups, the centre notes that the most rapid growth is among women around 55 years of age.
“The average age women start a business is around 45, so that means that if there are a lot of 25-year-olds doing it, there are a lot of 65-year-olds doing it as well,” explains Sandra Altner, CEO of the Women’s Enterprise Centre of Manitoba.
Retirees choose to start businesses for a number of reasons, often the least of which is income, she says. Other drivers can involve wanting to stay involved in working life, keeping up with the social and technology trends, maintaining contacts and gaining a “raison d’être” in retirement.
“I think a lot of people think of women retiring and going into businesses as the little lady making some pin money and those days are gone. I think we’re seeing much more serious kinds of businesses starting,” she adds.
While some people’s retirement businesses are based on the work that they did in their full-time job — consulting, for example — some choose to go in an entirely opposite direction, starting businesses based on hobbies, including everything from jewellery-making to photography.
For Toronto-area resident Brian Dougherty, a hobby photography business was something he began during his working life and chose to continue part-time after his retirement. In addition to the work being something you enjoy doing, he says having good background knowledge of the hobby is important for those who are considering turning it into a business.
Indeed, as with a small business start-up in any phase of life, there are several issues to consider before starting a hobby-based business in retirement, such as:
1. Knowing the market
Spending part of your retirement savings on a new business without doing research or having all the facts is a big risk, says Altner. You should research whether the market actually exists for your product or service, what the most effective way is to promote your business and whether or not it can be handled operationally. Market research can include:
- Creating a business plan. As with starting any business, Altner recommends a business plan, whether you aim to start a part-time or full-time business. This research will help you discover what the market is for your particular industry, who your competitors might be, what your prices should be and how that product or service fits into the marketplace.
- Getting trained/taking courses. For example, the Women’s Enterprise Centre offers a free Welcome to Business class where women looking at starting a for-profit business can learn about what’s involved and what a business plan might look like. You could also talk to a business advisor, says Altner. Plus, Service Canada has several resources on starting a business available for seniors.
2. Be financially aware
Dougherty’s advice to others considering a hobby-based small business in retirement is that you should be aware that you will need some money behind you to run the business and you should be prepared to make some investment in equipment.
3. Be aware of the time commitment
While the advantage of running a hobby-related small business in retirement is that the work can be done anytime, one downside is that it can be restrictive if you want to maintain an active lifestyle, says Dougherty. As a result, he chooses when to take work, favouring short-term assignments rather than booking too many long-term wedding appointments that might restrict his ability to travel. “There is a point in one’s life when one steps back from work,” says Altner. “That’s what retirement is all about, and you don’t want to be jumping right away into something that’s keeping you even busier than your old job did.”