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The new economy's new face
by Mark Evans - Thursday, April 6, 2000

It wasn't that long ago that children would start a business by setting up a stand outside their house and selling watery lemonade for 10 cents a cup.

These days that same child would be just as likely to build a Web site and start a business selling lemonade supplies to customers around the world.

The Internet's emergence as a global business force has not only eliminated borders, but has levelled the playing field for companies and individuals. With a Web site and some entrepreneurial flair, a one-man operation can be made to look like a world-class company.

Among the most enthusiastic beneficiaries of the Internet's anonymous nature are entrepreneurs so young they can't even vote: the teen-trepreneurs. Armed with good ideas and an abundance of youthful energy, they are starting on-line businesses and rewriting the rules about how old you have to be to become an entrepreneur.

"To be a veteran in the banking industry, you'd have to be 40 or 50 years old, and to be a pioneer you would have to be 500 years old. To be a pioneer in the Internet, you can be any age," says 21-year-old Albert Lai, who co-founded Mydesktop.com with teenagers Michael Hayman and Michael Furdyk.

On the Internet, education, work experience and a network of contacts -- the pillars of the Old Economy -- are losing their importance. In the New Economy, the important ingredients for success are an abundance of enthusiasm, strong ideas and a willingness to sacrifice every other part of your life to make a business succeed -- a feasible option for teenagers without a spouse, children or mortgage.

It has come to the point where stories about twentysomething entrepreneurs have become passé. If Marc Andreessen had started Netscape Communications Corp. now, it is unlikely that he would have been hailed an Internet "wunderkind." He was 23 when he co-founded the business in 1994.

Increasingly, the new on-line entrepreneurs are barely old enough to drive. But that has not stopped them from taking their talents onto the information highway. Many have used the Internet for a good part of their lives and have a better grasp of where the Internet is going than well-seasoned executives.

In Canada, the teen-trepreneur crowd includes Web site designer Keith Peiris, Michael Furdyk, who co-founded Mydesktop.com, Emerson Segura, who started TargetNet Inc. at 17, and Brad Mills, a Web veteran at the ripe old age of 19.

Mr. Mills, along with 21-year-old Fabrizio Pilato, last year founded TwoMobile.com Inc., a dot-com upstart that reviews wireless products (http://www.twomobile.com). He says teenagers are getting more respect as teen-trepreneur success stories on the Internet become more common.

"People are interested and willing to help because it's different," he says. "I created a business where we can play with toys and go on trips. Hopefully, one day it can spawn other things."

Risk is the key consideration when it comes to dealing with teenage entrepreneurs. Clients risk the chance that teen-led businesses can't deliver what they promise, while investors risk backing an entrepreneur that may not have enough experience to turn a good idea into a good business.

John McMahon, chairman of Internet incubator EcomPark Inc., says dealing with young entrepreneurs is extremely risky, and that tends to overshadow the success stories of twenty-somethings like Mr. Andreessen, of Netscape, and Jerry Yang, who co-founded Yahoo Inc. while a university student.

"There are pockets of brilliance out there and success stories but there are too many other opportunities that have all the right elements: a seasoned business leader, great technology and a huge market space," he says. "It's a matter of risk and a matter of your business model, and our business model doesn't lend itself well to sponsoring 19-year-old entrepreneurs."

While teen-trepreneurs may not be Toronto-based EcomPark's cup of tea, there are a growing number of investment firms willing to nurture young people and their ideas.

At the forefront is NRG Factory, which has a lofty vision of becoming "the world's most successful Internet business incubator by drawing from a growing community of techno-savvy youth."

It is a rather unorthodox approach, but Matthew Saunders, chief wealth architect, president and co-chief executive officer of Toronto-based NRG Group, says there is no reason why vibrant companies can't be created with young people at the helm.

"You have to have a combination of young minds who have a vision for how a business will develop, and experienced minds who know how a business is operated, and meld them together," he says.

NRG's incubation formula involves strong doses of mentoring, teaching and administrative support. This lets young entrepreneurs focus on their ideas -- without having to worry about the nuts and bolts of running a business.

"It's just a matter of giving them the freedom to be creative and letting them focus on what they are good at," he says. (NRG's portfolio includes TwoMobile.com.)

To become confident in a young entrepreneur's ability to build an Internet business means ignoring some of the traditional tools investors use to measure credibility, such as a track record and grey hair.

"If someone has created two or three Internet businesses, that's fantastic, but there aren't that many people who have," Mr. Saunders says. "This is a brand new space."

Twelve-year-old Keith Peiris epitomizes the power of the Internet and how it gives young people access to a large, receptive audience.

In the past nine months, the London, Ont., elementary school pupil has started a Web site design business and already has ambitious plans to expand into other computer businesses.

With computer skills honed since he started playing with PCs at the tender age of three, Keith has developed a knack for building Web sites -- displaying the same natural affinity with a mouse that many Baby Boomers have with the remote control for their TV.

Keith's status as a teen-trepreneur and Web celebrity was sparked last year when his application to attend a conference run by software maker Macromedia Inc. was rejected because he was too young.

Keith and his father were invited to the conference as VIP guests, after he sent an e-mail, including two of his Web site designs, to Macromedia's CEO, Canadian ex-pat Robert Burgess.

Macromedia then highlighted one of Keith's Web sites in its on-line gallery, and business inquiries started to materialize. Suddenly, he became an entrepreneur.

The precocious preteen, who refers to himself as "we," is typical of the young entrepreneur: confident to the point of being cocky, talented, and optimistic that success can be achieved with hard work and innovative ideas.

As far as he is concerned, his age is irrelevant.

"All my clients, including Interep, did not look at my age, color or race," says Keith, who is of Sri Lankan descent. "They looked at my skill and ability. We've had some potential customers, who, once they knew my age did not reply, but those are mainly people who are not willing to take risks."

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