Entrepreneurship. It conjures images of twenty-something graduate students hacking code in a Silicon Valley dorm room, fueled by a steady supply of Red Bull and Ramen. Starting a tech company requires youthful vigor, endurance, freedom from obligations like mortgages, imagination, and an intimate understanding of what’s trendy and hip. Right?

To be sure, a number of tech titans started more-or-less this way: Facebook, Google, Microsoft, Yahoo, and Hewlett-Packard, to name a few.

However, a new study published last week by the Ewing Marion Kauffman Foundation – the group devoted to fostering entrepreneurship around the world – suggests that the age distribution among company founders is much broader than we might have imagined.

The study offers several findings:

• Technology company founders born in the U.S. had an average age of 39 when they started their companies.
• Among a sample of companies started in 2004, two-thirds of founders were in the 35-54 age bracket.
• The 55-64 age bracket exhibited the highest rate of entrepreneurial activity from 1996 to 2007, while the 20-34 bracket actually had the lowest rate.

However, these findings don’t come as much of a surprise to us here at Cayenne Consulting. We’ve spoken with thousands of entrepreneurs, and although we don’t ask people their ages, we do witness the experience they bring to a new venture. Those who succeed at generating interest from investors tend to have decades of business and technical experience.

The study’s author argues that the shifting age distribution in the U.S., coupled with a continued decline in job security, will put more middle-aged people in this entrepreneurial sweet-spot. As a result, “we may be about to enter a highly entrepreneurial period.” I hope she is right, because entrepreneurship will clearly play an important role in our return to economic prosperity.

But perhaps the most encouraging insight for those who’ve ever thought “I’m too old to start a company” is simply this: No, you’re not!

We can measure success in many ways. In business, one important measure is the value of the company. That’s because a company’s value is a composite of all of the quantitative and qualitative factors that comprise a company: revenues, expenses, risks, growth prospects, quality of the management team, competitive advantages, strength of the intellectual property, and so forth.

In general, we want to do the things that increase the value of the business, and we want to avoid doing the things that reduce it. The problem is that we often lose sight of the big picture, and get mired in everyday distractions.

One useful technique for keeping your eyes focused on what really matters is Cayenne Consulting’s Venture Value Scorecard™. It’s human nature to prioritize the metrics that get measured, so the simple act of keeping track is often enough to have a significant positive impact.

The Venture Value Scorecard is a one-page summary of your company’s achievements and assets: the factors that contribute to the value of your organization. It should be updated monthly so that you have a regular reminder of where you’re making progress, and where you may have become complacent.

You can structure your Venture Value Scorecard any way you like, but I suggest organizing it into the following sections:

• People: A strong team is obviously central to value creation. Your Venture Value Scorecard should highlight your recent successes in recruiting highly qualified team members to fill the most important gaps in your organizational structure. You can also use this space to keep track of innovators (R&D personnel) and rainmakers (sales & marketing personnel).
• Products: You obviously can’t create value without a viable product (or service) to sell. This section of your Venture Value Scorecard should summarize the important advances you have made recently in research and product development.
• Customers: A company’s only sustainable source of cash is sales, so you need to keep track of your business development efforts. You should inventory your best accounts and prospects, as well as the status of any pending major sales.
• Partnerships: Relationships with larger firms not only confer legitimacy to your business; they can be an important source of intellectual property, distribution channels, and marketing clout. You should document the status of your partnership negotiations so that you can easily gauge progress.
• Competitive Advantages: Your ability to create value depends on your ability to grow and protect your market share. This requires the continuous development of competitive advantages, whether through intellectual property, new innovation, exclusive distribution partnerships, key endorsements, brand building, corporate culture, or other factors. Keep track of what you’re doing to develop and enhance your sustainable competitive advantages.
• Net Income: The five factors listed above all contribute to something that is directly measurable: net income. Part of your Venture Value Scorecard should be devoted to summarizing your income statement. Detail isn’t important; tracking your progress is. Items that paint a big picture include revenue by major product area, cost of goods, and operating expenses by category. If you have a lot of non-cash items such as amortization or depreciation, or if you have unusually long receivables cycles, you should also include adjustments to reconcile net income to cash flow.
• Assets: Your assets add to your venture’s value, so any recent or pending changes in your assets should be recorded in your Venture Value Scorecard. These assets include things like cash (say, from a pending investment), facilities, inventory, and other property.
• Liabilities: Your liabilities detract from your venture’s value. Any recent or expected reductions in your liabilities should also be recorded in your Venture Value Scorecard.
• Risks: Unexpected events can kill a firm (of any size), and can therefore detract from its value. This is an opportunity to demonstrate that you recognize the greatest sources of risk facing your company, and that you’re taking prudent steps to mitigate the greatest hazards. Use your Venture Value Scorecard to summarize your major risk management initiatives.
• Other: Every company is different, so you’ll need to customize the Venture Value Scorecard for your own circumstances. I suggest you try to figure out the 3-5 key metrics that are used to judge the health of companies in your industry, and keep track of these somewhere in your scorecard.

As noted earlier, your Venture Value Scorecard should be updated monthly. Keep an archive of your old scorecards. That way, you can go back and review the progress you’ve made. I think you’ll be pleased by the momentum you maintain by keeping score.

© 2009 Cayenne Consulting LLC. The Venture Value Scorecard™ is a trademark of Cayenne Consulting LLC.

ABC and Mark Burnett Productions are developing a new reality program putting entrepreneurs through the fundraising hoops. There’s still time to make the casting call if you’re interested in applying. Here’s what they have to say:

The producers of the new ABC reality series Shark Tank are on a nationwide search to discover the next successful – and possibly wealthy – entrepreneurs, inventors, businesspersons, dreamers, promoters, creators and innovators. In each episode, budding entrepreneurs are given the unprecedented chance to make their business ideas come true.

If you feel you have a lucrative business idea but just can’t seem to secure the financial backing to get it off the ground, then Shark Tank is just the show for you. Casting is looking for aspiring entrepreneurs who can pitch their breakthrough business concepts, products, properties and services to moguls in hopes of landing investment funds. If selected, five real-life, tough investors could be willing to part with their own hard-earned cash and give you the funding you need to jumpstart your idea. But the investors, also known as Sharks, aren’t just out to invest; they too have a goal — to own a piece of your next big idea.

Your business idea should be top-notch and something the Sharks will really want to sink their teeth into and might even spark a bidding war between them. Who knows – you could be the fortunate entrepreneur who gets the Sharks to reveal the true level of their interest and bid up the price of your investment!

All interested parties should email Lindsay Spaulding at lindsaycasting@gmail.com with the following information: Name, Age, Hometown, Phone, Photo; Are you an: Inventor, Entrepreneur or both?