Gen Z Entrepreneurs: A New Wave of Small Business Owners Driving Innovation and Change

In the latest Amex Trendex: Small Business Edition report, American Express sheds light on the evolving landscape of small business ownership, with a particular focus on the impact of Generation Z. This group, often known for their digital fluency and innovative thinking, is making waves in the world of entrepreneurship. While traditional challenges like pricing and cash flow forecasting still weigh on the minds of many small business owners, the optimism and determination of Gen Z entrepreneurs are reshaping the future of small businesses in America.

Gen Z entrepreneurs are diving into the business world earlier than their predecessors. According to the survey, 20% of Gen Z and Millennial small business owners started their businesses while still students or unemployed, a stark contrast to just 3% of Gen X and Baby Boomers. For these young entrepreneurs, starting a business right out of school feels like a natural step, largely due to their comfort with technology and digital tools. With the rise of online resources and social media, Gen Z has an unprecedented ability to learn about entrepreneurship and launch a business without the need for traditional job experience.

Their entrepreneurial journeys are shaped by their seamless integration with technology. More than half of Gen Z business owners (56%) say they learned about entrepreneurship through online platforms and social media, far more than Gen X and Baby Boomers, who primarily gained this knowledge through personal connections. This reliance on technology goes beyond just learning about business—it’s a tool they use every day. A third of Gen Z entrepreneurs credit technology solutions as the key factor in helping them navigate the challenges of the past few years, far surpassing the 18% of older generations who cite technology as a contributing factor.

Despite the benefits of technology, Gen Z entrepreneurs aren’t without their doubts. Many in this generation are more skeptical about the path to success compared to older entrepreneurs. For instance, 21% of Gen Z believes you need to be wealthy to start a business, nearly twice the number of Gen Xers and Boomers who think the same. They are also more likely to believe that entrepreneurs are born, not made, with 33% of Gen Z holding this view compared to just 22% of older generations. These concerns reflect the uncertainty that comes with the entrepreneurial journey, especially in a world where financial resources and independence are often seen as prerequisites for success.

At the same time, Gen Z business owners remain driven by their passion and desire for flexibility. A large majority (84%) of Gen Z entrepreneurs started their businesses because of a personal passion, and 65% were motivated by a need within their community. Their businesses aren’t just about making money—they are about creating something that reflects their values and provides a meaningful service or product. Additionally, 44% of Gen Z entrepreneurs wanted more flexible work options, which has been a key reason behind their decision to start their own businesses. Flexibility is not only about controlling their schedules but also about creating a work environment that allows them to live life on their terms.

Looking ahead, Gen Z entrepreneurs aren’t just thinking about the short-term. Six in ten (60%) of them expect their businesses to last more than five years, signaling a strong commitment to long-term success. This aligns with the broader trend seen across small business owners, who view their companies as more than just a job, but as a lifelong venture that they are dedicated to growing and maintaining.

With their unique blend of passion, digital savvy, and a willingness to tackle challenges head-on, Gen Z entrepreneurs are shaping the future of small businesses in the U.S. They are reimagining what it means to be a business owner, embracing technology to streamline operations, and prioritizing flexibility and purpose over traditional career paths. As this generation continues to innovate and push boundaries, it’s clear that Gen Z is not just starting businesses—they are building the future of American entrepreneurship.