They are collaborative, creative, and -- above all -- confident. And all of them were born after October 31, 1978.
Millennials -- a.k.a. Generation Y, a.k.a. echo boomers -- are widely characterized as spoiled, impatient, and narcissistic. Their childhood bedrooms overflow with trophies earned just for showing up. Raised on a diet of adoration and encouragement, they enter adulthood rosy with entitlement. As they swarm into the workplace, their hair perpetually mussed from the wind stirred up by helicopter parents hovering nearby, companies worry how to accommodate their outsize expectations. Merrill Lynch (NYSE:MER) sponsors a Parents Day for summer analysts, so Mom and Dad can ensure their offspring are well cared for by their new work families.
As a CEO, you may wonder how to absorb such difficult young people into your company. But here's a better question: How do you compete with them? Because they are starting some fascinating companies.
Dismissing the latest crop of twentysomethings as navel-gazing screen-a-holics is a mistake. This generation, at nearly 80 million strong, is poised to be the largest, the most educated, and the most diverse in American history. That gives its members special insight into the largest, the most educated, and the most diverse market in history. They are also fearless about technology. The kids of the '80s grew up with computers; the kids of the '90s can't recall (and shrink from imagining) life before the Internet. And they are idealistic and optimistic -- traits that influence their perceptions of business. Steve Jobs and Mark Zuckerberg are their heroes. And when they think of corporate America, they think of Office Space and maybe Enron. Were these guys born to be entrepreneurs or what?
As for being spoiled and narcissistic: I have yet to meet an entrepreneur of any age who isn't supremely confident, easily distracted by new ideas, and proud of being unemployable by ordinary companies that insist on coloring inside the lines. Entrepreneurs believe they can do anything. That belief is no less powerful for having been hammered in by their parents.
But, yes, Millennial entrepreneurs are a breed apart from those who came before. The ways in which they start companies -- and the companies they start -- reflect those distinctions.
The most significant differences arise from growing up wired. Say what you will about Facebook and MySpace; those who frequent them accept communal action -- including communal idea generation -- as the norm. Millennials are, in general, far more open and collaborative than their older counterparts. The iconic image of the lone-wolf entrepreneur holds little romance for them. Instead, they start businesses with partners -- in some cases with entire teams. Etsy, a Brooklyn, New York, website, is a virtual crafts fair at which artisans market handmade walnut coffee tables and lamps made out of vintage glass coffeepots. Co-founder Rob Kalin, an aspiring classics professor, came up with the idea in 2005 and partnered with two techies whom he met in college to launch it.
Millennials also like to build elements of community into their businesses. Matt Mullenweg's wildly successful software company, Automattic, which handles blogs for CNN and The New York Times, began as an open-source project to create better blogging software. Then a teen with no experience in software development, Mullenweg recruited volunteer coders who built, tested, and refined what has become WordPress -- one of the most popular blogging platforms -- all for no pay. Anyone can contribute to the code (so far, hundreds of people have done so), and anyone can download the software for free. "We're democratizing publishing," says Mullenweg.
And, yes, Millennial entrepreneurs are often impatient. (Inc. was even scooped by Bobby Kim of The Hundreds, who blogged about this article and who would be mentioned in it about six weeks before it hit newsstands.) But why shouldn't they move fast? Many start either Web-based or service companies whose barriers to entry can be quite low. And their customers -- particularly those customers who share the founders' demographic -- don't blink at beta. In fact, many Gen-Y entrepreneurs, infused with the aforementioned communal spirit, rely on feedback from early users to improve their offerings. Rather than sweat over business plans, they throw out something rough, then tweak and experiment. Xobni, co-founded by Adam Smith and Matt Brezina, hopes to transform Microsoft (NASDAQ:MSFT) Outlook inboxes into social networking tools. Early on, the founders routed users through a welcome page that humbly noted the product wasn't perfect and asked for feedback. It's company building as class science project.
Millennials are the most globally minded generation since the one that invented Earth Day. Making the world a better place is sometimes an element in their mission statements, sometimes their founding principle. Meraki, for example, which is backed by Google, builds mesh Wi-Fi networks that provide free or low-cost Internet service to poor communities. MIT student Sanjit Biswas tested the model in a low-income housing development in San Francisco; Meraki is now expanding into India, Africa, and Latin America.
The Millennials may resemble their '60s counterparts in idealism. But unlike counterculturalists, they do trust people over 30. Accustomed to the nurturing and guidance of their parents, Gen-Y entrepreneurs are receptive to the advice of older, successful company founders who were minted in droves during the '80s and '90s.
Brendan Ciecko, founder of Web design firm Ten Minute Media, has three mentors, all more than a decade older than he is. One helps Ciecko think about the business of technology. Another one advises him on intellectual property issues. A third is his social responsibility guru. "It was really surprising to me that people like this would be willing to take time out from their own businesses to talk to me once or twice a month," says Ciecko. Smacks of entitlement, doesn't he?
So Millennials get by with a little help from their friends, their parents, and their mentors. But they also draw on an unprecedented formal support system that grew up, like them, in an era of fascination with entrepreneurship. This infrastructure now serves a demographic that is intellectually prepared and temperamentally inclined to exploit it.
Much of that support system, not surprisingly, is university-based. Millennials start companies in dorm rooms while studying the subject of starting companies in classrooms. Approximately 2,100 colleges and universities offer at least one class in entrepreneurship, according to a 2006 study by the Ewing Marion Kauffman Foundation, and the discipline has sprouted more than 400 endowed chairs. Many schools also sponsor business plan competitions. Nate Alder, a student at Brigham Young University, has won first or second place in 11 competitions over the past year for his company, Klymit, which has developed a way to insulate outerwear and outdoor gear using argon. Alder racked up $200,000 in prize money, potential strategic partnerships, and recognition in the national business press before he even had a product to sell. (See: Gen Y, impatience of.)
