Entrepreneurs who have spent their lives building businesses may underestimate the difficulty of quitting cold turkey
F. Scott Fitzgerald once observed, "There are no second acts in American lives," but if he were alive today, he might consider revising the quote. After a lifetime in politics, Al Gore won an Academy Award and has refashioned himself into a business and media mogul, founding an investment firm, an Internet television concern, and advising or sitting on the boards of companies such as Google (GOOG) and Apple (AAPL). Mitt Romney moved in the opposite direction, leveraging success as leader of private equity titan Bain Capital and head of the 2002 Winter Olympics into a successful term as governor of Massachusetts and now a run for the U.S. Presidency. Even former Federal Reserve Chairman Alan Greenspan is getting into the second-act "act," recently announcing that he has signed on as an adviser to Deutsche Bank (DB).
If you haven't yet started to think about your own second act, it's never too early to start. Peter Drucker predicted the average young American at the turn of the century could expect to have about six careers in a lifetime, in part because of the rapid, discontinuous changes reshaping the workplace. While in many countries people's job mobility is severely limited by class, educational background, or other societal factors, people in the U.S. today still enjoy an unprecedented freedom to change careers midstream. A friend of mine who was a massage therapist for more than a decade is today a top computer networking consultant. Another friend, a top person at Morgan Stanley Private Equity (MS), is building universities in Asia.
Even my own career is an example of the highly transitory nature of modern careers: I spent the first decade of my career as a university administrator, the next as a technology CEO, and I'm now a writer and consultant. Every new career I have enjoyed has been built on the experiences of the last and has opened my mind to whole new ways of thinking (BusinessWeek.com, 5/15/07) and exciting new experiences.
Retirement's Dirty Little Secret
As modern medical science allows people to enjoy longer, healthier lives, many are finding that retirement isn't all it's cracked up to be. Many of my own friends have tried retirement, but found that they missed the intellectual stimulation and collegial environment that meaningful work provides. For those who had invested time prior to retirement thinking about a second act, the transition has been reasonably smooth. For those who failed to look up from the grindstone until just before retirement, many have been surprised by just how difficult creating a second act for themselves has been.
The second act conundrum is about to hit small business (BusinessWeek.com, 1/16/07) in a big way. Last year, the first of the Baby Boom generation turned 60. (An American now turns 60 every 11 seconds.) The people who make up this 77-million-strong cohort born between 1946 and 1964 will soon be faced with the decision to stay in their current position, retire, or create a second act. Some of these people have spent their lives building businesses that, in many ways, have become extensions and expressions of who they are. They may greatly underestimate the difficulty they will have in quitting work cold turkey.
These people have knowledge and skills that would make them valuable assets in any number of capacities, including mentoring young entrepreneurs, serving on boards, consulting, or running firms. But to assure a successful second act for themselves, they should start the process early. Here are a few suggestions.
1. Develop an avocation into a vocation. When I was a business-school dean, I started to do a little consulting on weekends. Within a year I was making more money (and having more fun) consulting than I was in my day job, so I quit the university to be a full-time consultant. Then, as a consultant, I began serving on boards—mostly for the experience—and one of those board positions led to my first CEO position.
When I retired from running companies and restarted my consulting business, I started writing this column, which led to a book contract with Random House. In each case, what started as a sideline interest became a major part of my work life.
2. Match the demands of the job to your energy level and work-life desires. The last technology company I ran had more than 2,000 centers in 60 countries. That was great when my wife and I were childless. She enjoyed travel and would often travel with me overseas. But when our first son was born, I no longer wanted to spend half of my life on airplanes. So, my family was a big factor in my decision to start a consulting business. Though I still travel a lot, I limit myself to 90 nights away a year and can usually get home every weekend.
3. Look for "middle lane" opportunities. One of my business-school colleagues coined the term "middle lane" to describe a job that provides adequate challenge and interaction but is not in life's fast lane. From a middle-lane position a person can choose to shift into the fast lane for a few months (or years), then shift into the slow lane for a time, depending on what they want. Running a business is generally requires a fast lane commitment. Serving as an executive in residence for a venture firm, offering operational help to companies owned by private equity firms or consulting typically does not. I have built my consulting firm around the idea of providing a place for "middle-laners" to find meaningful work. There are three distinct tracks for members of my firm—a slow lane, a middle lane, and a fast lane—and partners can shift from one track to another whenever they want.
4. Be clear about your objective. The most important factor in creating a successful second act may be the degree to which you truly understand yourself and your motivation for working. This will be key to finding the right match for you. I tucked away in a file William Safire's inspiring comments on why he retired from The New York Times Op-Ed page in January, 2005. He recalled being told about the need to keep trying something new, and that "when you're through changing, you're through." In his farewell column (NYTimes.com, registration required), he wrote: "Combine those two bits of counsel—never retire, but plan to change your career to keep your synapses snapping—and you can see the path I'm now taking. Readers, too, may want to think about a longevity strategy."