Ask any child what they want to be when they grow up and they’ll likely say a fireman, a nurse, a doctor or an astronaut. Becoming an entrepreneur and starting their own business is not usually top of mind for children. Yet, it’s been estimated that, in five years’ time, more than 40% of the American workforce will be freelancers, part-timers or otherwise self-employed. South Africa will likely follow suit.
With the evolving workplace, financial and entrepreneurial knowledge is becoming as important as knowing how to read and write. Early exposure to these skills is essential. The more you integrate finances and money into your children’s everyday lives, the more comfortable they’ll be with personal finance as adults.
Yet, research conducted by the Sage Foundation and Livingfacts found that early exposure to entrepreneurship opportunities are limited for women, with only 15% of respondents saying they discussed business with family and friends when they were young, and only 19% saying they discussed money matters with their families as children. Discussions about business and finance at an early age were higher for those who currently own a business.
Traditionally, it’s the sons who are entrusted with the family business and taught how to be leaders. Yet, while it’s especially important that we equip girls with the knowledge, skills and confidence to become entrepreneurs, we need to start thinking about how to instil the entrepreneurial mindset in all children, regardless of gender or age.
Here’s how you can start teaching your children about entrepreneurship, to better prepare them for the future.
• Make it fun. Nothing will put a child to sleep faster than talk about debt and interest. But if you turn it into a game, your child will find it hard to resist. Dust off the Monopoly or set up a make-believe shop and teach children the value of money through play.
• Teach the basics. If your children love puppies (and what child doesn’t), they could start a dog-walking business in the neighbourhood. A business idea is the first step. Next, they’ll need a name for their business, a target market, guidance around how to price their services and advice about how to reinvest money from sales into growing their business.
• Spot opportunities. A dirty dog is an opportunity to provide a dog-grooming service. If your child has more dogs than she can handle, she can recruit her friends and pay them a portion of the fee. Just like that, she has scaled her business, created jobs for others and provided additional value to her customers. At home, provide opportunities for her to help beyond her usual chores to earn extra money.
• Make savings visual. Get three jars and label them ‘save’, ‘spend’ and ‘share’. The money that goes into the save jar teaches your child patience and consistency as he saves up for that toy he’s had his eye on. Teach him to save at least 10% of his earnings and pocket money. Split the rest between spend and share, which he can use to buy dog shampoo and to donate to the local SPCA. This is essentially his first budget that shows him how much he has and how much he still needs.
•Don’t sugar-coat it. Sleepless nights, sacrifice, failure and hard work are badges of honour for every entrepreneur. Teach your child that running a business is not always easy and they’ll have to do things they don’t want to – like pick up poop. They’ll have weeks where no one needs their dogs walked and they might feel like they’ve failed. Teach them to try again tomorrow – resiliency is a cornerstone of entrepreneurial success.
• Think beyond money. Teach your child the softer skills of entrepreneurship. We’ve mentioned resilience but entrepreneurs are also creative, industrious, curious, confident and optimistic. Encourage them to try new things, let them make their own decisions and learn from them, while also respecting the decisions of others. Teach them effective face-to-face communication and get them to send you emails with full sentences and no text speak.
• Embrace Entrepreneur Day. Far removed from the bake sales of old, the entrepreneurship days held by schools today teach children a lot more than just selling treats to make money. Children are encouraged to build their businesses around their passions and talents. They’re taught about target markets, product improvement and how to overcome setbacks through problem-solving. Help your child to develop her business plan and to understand the needs of her target market to ensure her next Entrepreneurship Day is a successful one. Sage recently partnered with the Young Entrepreneurs’ Foundation to host a type of entrepreneur day, where we taught financial literacy to children from Iphuteng Primary School, in Alexandra. The children used that knowledge to host a market day and sold homemade products to Sage staff, earning an impressive R4,000, which shows that, once children understand financial literacy, they can develop their ideas into products and services that people want to spend their money on.
• Teach them to give back. We’re not only teaching our children to be decent human beings but also to do something significant. Your child could walk shelter dogs for free and in the process, learn humility and the joy of helping those less fortunate.
Entrepreneurs are key to a nation’s economic development. They’re the innovators, the risk takers and, most importantly for South Africa, the stimulators of economic activity, skills development and new jobs.
I can’t imagine a more significant role for our children.
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