Magazine article Management Today


Magazine article Management Today


Article excerpt

So far, the young have led the stampede into dot.coms. But there are no age barriers to entry -- in the new economy you're as old as you think. The Y factor is as much a state of mind, reflecting an ability to learn and adapt, as a consequence of your date of birth.

It's the stuff of fear and loathing, prompting envy on a generational scale. The phenomenon of young millionaires has turned the world upside-down. In the new economy, you don't need to serve an apprenticeship. You just do it. The speed of change is disconcerting, but it's also exhilarating.

Prospects in 'legacy' firms may have taken a nosedive, but breath-taking horizons are opening up. All hinges on whether you have the Y factor. What is the Y factor? Clearly, young people have it in shedloads. Y is for youth -- and all the qualities that come with it. Stamina, an open-mindedness about the way the world works. A willingness to take risks, a readiness to break rules.

As so often, California has been the pathfinder. Jerry Yang, cofounder of Yahoo, was a billionaire in his twenties. Barry Glassner, a sociology professor at the University of Southern California, has witnessed the power of peer-group pressure within a generation. 'When you see people your own age become millionaires, this creates a gold- rush mentality, especially among those with specific IT skills or with business aspirations.'

The stampede of young people into the e-conomy is global. In Japan, young e-trepreneurs like 34-year-old Hiroshi Mikitani are creating the green buds of a new economy amid the ruins of the old economy. Mikitani has set up Rakuten, an e-shopping and auction service, to undercut Japan's notoriously inefficient distribution and retailing sector. In India, companies such as Infosys Technologies are on a roll as they take advantage of the country's abundant supply of young science graduates.

Today's 20 and early 30-somethings may be piling into the e-conomy, but they have advantages other than youth. The Y factor comes with being a member of the Y generation. In Japan, as in many other countries, the mid-1960s are seen as a watershed, with the generation born after that time breaking with the tradition of lifelong corporate attachment. New technology is under the skin of today's younger generation.

The Y factor is also about business confidence and the opportunities that come when the economy is booming. Professor David Storey, a specialist in small businesses at the Warwick Business School, has analysed the age of people starting up new enterprises over the past decade or so. He highlights the huge contrast between the boom year of 1988, when young people predominated, and the slump year of 1991, when their share in start-ups plummeted. 'In every boom, young people are disproportionately significant as a source of start-ups. What makes the difference this time is the sheer public profile of the dot.commers, it's this that's raised public awareness about young entrepreneurs.'

That profile comes from the huge fortunes that the young entrepreneurs are amassing, making today's boom conditions different from those of the late 1980s. For cheerleaders of the new economy like Julie Meyer, this reflects the revolutionary nature of the internet. She claims young people have been quick to grasp that 'the fundamental rules of the game are changing, there's an opportunity to get in at the ground floor by hustling and moving fast. It's getting really Darwinian out there.'

Venture capitalist Tom Teichmann of New Media Investors also thinks that this is a unique period when old corporate structures are cracking up and the old rules no longer hold sway. …

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