From hustle to bustle: How Gen Z businesses are booming

The overwhelming majority of startups founded by Generation Z entrepreneurs start off as a side hustle. New research suggests this may be as high as 92 per cent of 18-24 year olds, compared to just 65 per cent of older founders.

The research, conducted by independent pollsters Censuswide, explored the motivations and actions of 50 Gen Z founders and compared them with 50 entrepreneurs over the age of 25. It looked at the motivations for new ventures and found a significant shift towards a desire to make a positive impact on the environment and society.

Over two-thirds of Gen Z founders stated that they started their company to make a difference, compared to 54 per cent of over 25s. Unanimously, all of Gen Z founders surveyed said it was important to them that their business had a low impact on the environment. There was also strong motivations to ‘build in public’, publishing key information about their business successes and failures in an open and transparent manner online.

The research was commissioned by Connectd, a platform for managing and growing relationships between startups, investors and advisors.

CEO Roei Samuel suggested that “Gen Z entrepreneurs have “grown up attuned to the gig economy and flexible working, which means they thrive on having more autonomy in employed roles than ever before”.

He added; “They’re also increasingly bringing this agile mindset to their personal entrepreneurial journeys. Our research shows how Gen Z entrepreneurs are uncompromising with their ESG credentials, as they look to underpin successful business growth with strong ethics. This should act as a timely reminder for investors and advisors who are looking to support Gen Z entrepreneurs and share in their future successes.

“This is the generation where the next tech unicorns will come from and the wider startup ecosystem can benefit from understanding their mindset and approach to business. Building your business in public is a relatively new thing, intrinsically linked to the rise of social media. But it’s increasingly being used to open up opportunities for Gen Z founders to take investors and customers on the journey with their business growth.

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“When done right, it can be a great tool to build trust, embed a narrative that an audience can get behind and encourage valuable feedback that the business can learn from. This generation understands how to use key data points intelligently to tell the story of their business to the world and build confidence amongst key stakeholders.”

Fur further evidence of this generation wanting to go it alone, separate research by the metaverse platform Rethinkly, suggests that 28 per cent say they have no voice in the workplace. Researchers found 36 per cent find all workplace tension and confrontation too difficult, and 34 per cent say that the inability to communicate within the workplace has had the largest impact on productivity.

A Guide to the Gen Z Entrepreneur
Rethinkly

SME Publications/ SME XPO 2024