The patron saint of innovation

Who? Joseph Schumpeter, of course.

I wonder why he’s not more well-known, more celebrated, among innovators?

Perhaps it’s because he was an economist. But what an economist.

He was born in 1883 in Moravia, now part of the Czech Republic, and moved to Vienna aged ten, where he was to study law. In time he became a professor of economics and government at the University of Czernowitz, later serving as finance minister in Austria and as president of a private bank.

In 1932 he moved to Harvard and the USA. During his time there, his views were regarded as “old-fashioned”, not at all in tune with the dominant Keynesianism of the time.

Fundamentally, Schumpeter believed that capitalism was driven by a continuous process of innovation and by “creative destruction”.

Was Picasso aware of Schumpeter’s work when he said: “Every act of creation is first of all an act of destruction”?

Entrepreneurship and age

Interesting and provocative article by “Schumpeter” in The Economist* turning on its head the idea that entrepreneurs are predominantly the young.

Among the examples he cites of creativity stretching well into “Third Age” are The Rolling Stones, Paul McCartney and Leonard Cohen.

Then, digging into recent research, Schumpeter says that in the USA “twice as many successful founders [of start-ups] are over 50 as under 25, and twice as many over 60 as under 20.”

And he says that research shows that “the highest rate of entrepreneurial activity [is] among people aged 55 to 64 – and the lowest rate among the Google generation of 20 to 34 year-olds.”

So what might we conclude?

1.That experience coupled with creativity is critically important to successful entrepreneurship, and that

2.Maybe it’s more a generational thing more than an age thing. After all, the examples he quotes all come from the 1960s generation that considered creativity to be of the essence. Talkin' 'bout my generation. Schumpeter doesn’t seem to have considered this possibility.

Time will tell!

* http://www.economist.com/node/21548135