New directions

By Amanda Kramer

Susan Fox wasn't exactly Mozart or a da Vinci as a child.

She remembers piano lessons she was forced to take as a youngster (she didn't much like them). And she recalls her Catholic school days, when only students who showed natural talent were encouraged to pursue art in their classes.

So, it might come as a surprise to learn what life change Fox opted for in her early 50s.

This long-time former state bureaucrat left her career at the Department of Transportation and partnered with professional musician Hanah Jon Taylor to become an entrepreneur.

Fox and Taylor's collaboration - called the Madison Center for Creative and Cultural Arts - is a Downtown arts warehouse of sorts where artisan exhibits and music classes flourish. It's now almost four years old and Fox hasn't looked back or worried too much about what's ahead.

"This probably is one of the more fulfilling things I've done in my life ... I'm learning new things," she said. "I'm meeting artists; it's kind of a part of my personality I really hadn't cultivated."

Business professionals say more men and women 40 or over are seeking out the excitement of the entrepreneurial life for the first time, instead of readying themselves for retirement.

Greying, but still going

Anita Campbell, editor of the online publication "Small Business Trends," calls it the "graying" of small business.
According to Campbell, a business consultant and writer out of Ohio, recent U.S. government statistics show 31 percent of business owners are 55 or older - more than any other age group.

There are plenty of reasons why trends point to an increase in older adults with newer businesses, Campbell said.

"Exodus from corporate America is one factor," Campbell said. "Either due to downsizings or voluntary departures; no one stays with a company until age 65 anymore. We simply have more careers in a lifetime."

Also, the ease and economics of starting a small business today enable more people to become entrepreneurs, she said.

"Technology and the Internet, in particular, make it possible for small businesses to have access to the same kinds of tools and marketing channels as larger business," Campbell said.

Attitudinal or societal changes and income needs, additionally, play a part in the trend.

"We act and feel younger today at the advanced old age of 55 or 60," she laughed. "Even if we have money to retire, who wants to? It gets pretty boring.

"Our needs for income at the age of 55 may be less than at age 35 when raising children, buying a home," she continued. "So, in a sense, we can afford to start our own business. At the same time, many of us still need an income stream at 55 because we have another 30, maybe even 40 years to live."

The advantage of age

Beth Donley, former WiCell executive director and former counsel for UW's Wisconsin Alumni Research Foundation (WARF), said making the recent transition from public work to private entrepreneurship was a combination of the right timing and the right circumstances.

Donley and UW-Madison stem-cell scientist Gabriela Cezar formed one of the state's up-and-coming stem-cell companies, Stemina Biomarker Discovery, in fall 2006. Donley is now acting CEO of the company, while Cezar serves as chief scientific officer.

Donley said when the two met she realized their creativity matched perfectly. She said she saw the opportunity for the pair to take off with Cezar's ground-breaking research targeting birth defects and cancer. Currently, Donley is running the legal aspects of the business, while Cezar focuses on the study of stem cells and derivative cell types and creating medical diagnostic tests.

At age 43, Donley's focus right now is making sure the company has solid funding to get off on the right foot. And, that looks like it may happen effortlessly thanks to Donley's history in the state and well-developed contacts - a benefit to not being a business beginner.

"I think investors may trust me more," she said. "Most of the excitement comes when they know you and they know your reputation. Most of the people that are interested (in funding) know me and they know Gabriela."

Donley's suggestion is right on target, Campbell said. Baby boomers often have terrific connections due to their length of service in their field and the individuals who may have come across their business paths.

"If you have those connections to begin with, you're going to know who to talk to," Campbell said. "(Age and experience) can even be an advantage in getting bank financing."

Intellectual capital

While Donley's biotech start-up may be dependent upon a good angel investor or two, not all potential entrepreneurs looking to take off in various fields need to worry themselves with this detail.

Many businesses, Campbell said, require very little capital in the beginning.

"It could be like a consulting business where they're using their own intellectual capabilities," she said. "If you're going into retail you may need a certain amount of money to buy stock or inventory. If you're any kind of Internet or software company you probably don't need much investment to get started, but then you may be among the very tiny minority that goes after venture capital."

Neil Lerner and Jack Reiners, both with the UW-Madison Small Business Development Center, said they see people over 40 in their entrepreneurship training "all the time."

"Most people want to start a business in the next year, while a few are getting a head start on preparing for retirement five to 10 years down the road," Lerner, the SBDC's director, said. "Most people are planning on starting a business in relation to their work and expertise. The types of business mirror our local economy."

Just in the past 15 months, Reiners, a business counselor with the center, said he's seen 10 or more clients who are looking to delve into personal coaching businesses, construction consulting, coffee roasting and window treatment retail. And, "almost all are utilizing skills and experience acquired as an employee," he pointed out.

Older entrepreneurs, Reiners said, may need to do things a bit differently than a younger business owner.

He suggested baby boomers focus on their established contacts for help, keep their financial risk and on-the-job training to a minimum, and keep their goals and objectives for the business to a shorter time frame.

As for planning for retirement as an older entrepreneur, Reiners said, "most have established their retirement funding from employee days." He said he advises that preservation of capital is more important than growth or income.

"I suggest using an SEP (Simplified Employment Plan) or Roth IRA," Reiners said.

Campbell, herself, is an older entrepreneur. She said she was in her 40s when she decided to leave Bell & Howell Company (now called ProQuest Company) because she felt she'd gotten to a point where she could afford to start her own business.

She said retirement was something that she always thought about - rolling 401(k)s into a lump sum, and now keeping her money in an IRA in which she continues to invest. Campbell said entrepreneurs should stay aware of potential beneficial tax advantages - like write-offs for health insurance premiums and the unlimited ability to contribute to individual savings plans.

"When you look at those kinds of advantages - like the ability to still add to your retirement, or writing off health insurance premiums against federal income tax ... you may say 'Well, I don't need to make as many dollars as I did in the corporate world,' " she said.

"You gotta do this"

Initially, Fox knew she'd stay active following nearly three decades with the DOT. She figured she may explore some type of work with nonprofits, but a meeting in 2001 with saxophonist and flutist Taylor defined her fate.

The two eventually collaborated in 2003 to create the MCCCA. Now located at 306 W. Dayton Street, Fox said it serves as a dynamic place where the community can come for artistic experiences. The center offers everything from theater classes to salsa and tango dancing to African drumming.

Why fall into an entirely new career in her 50s?

"When I met Hanah I was really swept into his enthusiasm," she admitted. "We work together pretty darn well for totally different personalities. He's a most inspiring person - there's something about him that says, 'you gotta do this.' Sometimes once you start something, you can't let it go."

Taylor, also in his fifties, said he's glad Fox made the decision to come along for the ride. When the two first met and he introduced his ideas to her about the business, everything rang true with her. She may have been a novice to cultivating such a business, but "it was like I was preaching to the choir."

"I think anybody who can be a bureaucrat in the Wisconsin DOT for 30 years deserves a rest, first of all," Taylor said. "And, maybe an opportunity to actualize their ideas that could never manifest from behind a desk."

Amanda Kramer is a freelance writer.
kramer.news@gmail.com

New directions

By Amanda Kramer

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