Only about 14 percent of American business owners are estimated to be under the age of 35, and only 2 percent are younger than 25 years old, according to the 2012 Survey of Business Owners.  Women account for about 44 percent of these young entrepreneurs, meaning that—perhaps unsurprisingly—these age groups come closer to gender parity in ownership than any others.  However, although young folks make up an increasing share of the American population, studies demonstrate that their share of all business owners has stayed constant—or even declined.  In other words, there is reason to believe that entrepreneurship is losing popularity among today’s youth.


Hang on.  Haven’t these kids been heralded as “the most entrepreneurial generation”?  With an increasing number of universities offering entrepreneurship majors and programs, today’s college students have access to an ever-expanding network of resources and opportunities to help start their businesses. Plus, with rock-bottom interest rates, we should be seeing millennials starting businesses left and right—but we’re not.  So…what is up?

Well, among plenty of other things, student loan debt.  Literally.  National student loan debt is now estimated at a whopping $1.2 trillion, and the average student outstanding loan per recipient grew from $18,233 in 2007 to $27,689 in 2014.  This kind of financial burden can make it difficult for an individual to get a traditional business loan from a bank.  You can imagine how the need to hold to a student loan repayment schedule might damp down the risk affinity required to get any entrepreneurial effort off the ground.

Fortunately, some great resources exist for recent graduates looking to responsibly manage their loans while also building a business.  For example, the SOFI Entrepreneur Program, developed out of the common understanding that entrepreneurship can be extremely difficult when you already have student loans, caters to entrepreneurs who have a college degree, a fully developed business plan, and student loans.   Students must be full-time founders in an innovative business field, and be actively working with SOFI to refinance their student loans.

And examples of inspiring young entrepreneurs, who tackle challenges with grace and energy, are all around us:  Consider Catherine Morris, founder of Boston Arts and Music Soul Collective, an arts and cultural organization that creates and supports programs and events that promote music, arts and culture to and from communities of color; or Catie Cole, co-founder of FROTH, an application-based drink subscription membership now live in NYC.

Catherine derives a ton of value from things she doesn’t have to pay for, reporting that “Free webinars on business and arts-related subject matters have been most helpful to my personal and professional development.” And Catie reminds us that “It is of course difficult at first to hear anything but support and praise about your project…but in the end, it is because of these people who said “no” and who offered constructive criticism, that we were able to refine our plan, take slight pivots in every which direction —and end up with a company that we are now so proud of.”

Though we hear frequently about the coddling of the American college student, and so-called millennial privilege, today’s young entrepreneurs flout the popular stereotype of wandering and needy quasi-adults looking for affirmation and participation awards.  Let’s do our part to support their innovation and courage by thinking innovatively, ourselves, about how we can make it easier for them to both start a business and manage their student debt—to balance both risk and responsibility.


Author: Annie Rorem is the Senior Research Manager at the National Women’s Business Council.  She has almost finished paying off her student loans.

During the month of May, National Women’s Business Council will be profiling young women entrepreneurs—many of whom are still students.  Visit every Tuesday of the month to learn more about these inspiring women.