What to Keep in Mind When Pitching a Millennial Entrepreneur on the Value of Financial Advice
One of the hallmark characteristics of millennials is their entrepreneurial spirit. Millennials grew up idolizing self-employed icons like Mark Zuckerberg and Sarah Blakely, who serve as examples - albeit pie-in-the-sky ones - of what's possible.
But, while 62 percent of millennials claim to have considered starting their own business, the number of self-employed Americans under the age of 30 has actually plummeted 65 percent since 1980. This shift can likely be attributed to the serious financial strain many millennials have experienced due to lost jobs, college debt, and caregiving responsibilities.
This does not appear to dampen their spirit, however. Instead, these so-called millennipreneurs may choose to apply their entrepreneurial fervor to side hustles or intrapreneurial activities within a larger organization. Irrespective of their path, this audience shares a few common traits, such as a tolerance for risk and an appreciation for storytelling. Use this insight to your advantage and consider the following commonalities in your efforts to connect with the next generation of CEOs:
1. They Want to Hire You
Although millennials often turn to Google or social media for advice, one recent survey found that 83 percent of millennials believe that hiring a trustworthy financial advisor is important to their financial confidence. They're also more likely to attend a financial seminar compared to gen x-ers or boomers, so offering a one-day course or forum for millennipreneurs could be a strategic way to meet new clients.
Since they already see the value of your services, you don't need to "sell" to millennials. (In fact, coming on too strong could be a turn-off given that many millennipreneurs are seasoned at selling themselves.) Show potential clients that you understand the challenges they face and what financial guidance they need. For instance, rather than hearing the same old advice about budgeting, this generation reportedly craves more direction on investing.
In addition, many millennipreneurs need both business and personal guidance—79 percent of millennials worry that they won't have enough money to retire and 81 percent of college-educated millennials have at least one source of debt. And while many entrepreneurs blur the lines between their personal lives and their businesses, being able to speak to how to effectively separate their money matters would be a huge value-add. Lay out what your prospective client needs to do in order to focus on running their business or side hustle without compromising long-term financial sustainability.
2. They Are Values-Driven
Most millennials admire, and want to create, companies that change our world for the better. This generation is more giving than any other, with 84% donating to charitable organizations (compared to 72% of boomers and 59% of gen x-ers).
Millennials want to do well and do good. In many cases, their companies incorporate an altruistic aspect. (Think Bombas socks and Adventurist Backpack Co., both of which continually contribute to those less fortunate.)
Be enthusiastic about these motivations and share what inspires you as you embark on building a relationship with them. Explain how you can help make their social mission a priority beyond their business by suggesting investment opportunities that fall in line with their principles. When you are pitching a particular stock or fund to a millennipreneur, focus on a company’s mission statement and the impact they aspire to have on an industry or community, rather than performance alone.
3. They Are Persistent
average age of a successful start-up founder is 40, would-be millennialprenuers aren't worried about failing before they hit it big. In fact, entrepreneurs between ages 20 and 35 have set up twice as many businesses as those over the age of 50 have. (Perhaps this contributes to 55 percent of millennials’ faulty belief that their generation is more entrepreneurial than past ones.)
While this optimism (combined with a values-driven approach) could mean that many millennipreneurs focus on innovation, rather than financial success, their motto remains: try, try again. Because millennipreneurs are willing to take chances, they'll need an advisor who can tow the line between giving honest reality checks on the financial side and encouraging them to keep working toward their goals. Since their risk tolerance is higher, it's important to emphasize the value of starting early (compound interest at its finest) and a diversified portfolio in order to enjoy future financial security.
Of course, each potential client has his or her own ambitions (and blind spots). But, knowing where millennipreneurs are coming from, both in terms of their personal values and their financial situations, can help you more effectively communicate with these prospects and show them how you can meet their unique needs.