Is There An ‘Entrepreneurial Personality?’
“This defines entrepreneur and entrepreneurship – the entrepreneur always searches for change, responds to it, and exploits it as an opportunity.” – Peter F. Drucker
Research into identifying the key traits of entrepreneurs goes back to the early 1960’s, when motivation expert David McClelland, in his book The Achieving Society, noted entrepreneurs by highlighting their need for achievement as the differentiating key trait.
Other classic research findings have identified risk-taking propensity, tolerance of ambiguity, proactivity, innovation, and Type A personality as additional traits associated with entrepreneurial tendencies. Type A personality is a cluster of traits including competitiveness, aggressiveness, and need for control.
These early studies also highlighted a key point: the traits associated with a desire to be an entrepreneur might be different from the traits needed to succeed as one. In addition, some experts, such as economist and strategy consultant Danny Miller, argue that the classic entrepreneur traits have a ‘dark side’: narcissism, aggression, and power-seeking.
Does Personality Really Predict Success?
“The true entrepreneur is a doer, not a dreamer.” – Nolan Bushnell
Recent research by Christopher Collins and colleagues at Cornell University has reinforced and extended early investigations. They found that need for achievement is associated with success in business ventures. Other studies have found that conscientiousness is the best predictor of entrepreneurial success, while innovation, commonly thought of as a key trait, was a negative predictor – innovation seemed to reduce the odds of success!
Research by organizational psychologist Tim Vantilborgh might explain this surprising finding. Vantilborgh and his colleagues examined entrepreneurial success in the context of the life cycle of the venture. Proactivity, need for achievement, and risk taking were associated with organizational growth – in employees and revenue – in the later stages of the venture’s life cycle. It seems that having an innovative and driven CEO creates more competitive advantage in a mature organization than a young one.
These findings might also explain the classic entrepreneur profile: the most visible entrepreneurs – Richard Branson, Elon Musk, Steve Jobs – are those whose ventures are already in a mature stage. Does this mean that only entrepreneurs with this profile can succeed? Or are there multiple routes to entrepreneurial success?
The Many Roads To Rome…
“A thousand roads lead men forever to Rome.” – Alain deLille
Also known as, there’s more than one way to skin a pineapple. When we think of an entrepreneur, what do we imagine? Someone driven, motivated, controlling their own destiny? Someone with a fast car, a huge house, and an even bigger offshore bank account? Or someone with a small, family-run business they built to give their kids opportunities they never had?
The reality is that drive, motivation, and controlling your destiny are achievable in many different ways. Whether you want to build a family business so you can spend time doing something you love with people you love, or control a massive international empire, the traits, and the goal, are basically the same. Being highly motivated is only useful if we have a purpose, a channel for that motivation.
The most visible media examples may give a misleading picture of entrepreneurs, who come in many shapes and sizes. Lean startup pioneer Steve Blank identified four kinds of entrepreneurial cultures:
- Small business – the largest overall category;
- Scalable startup enterprise – predominant in Silicon Valley and other innovation clusters;
- Large company – which mainly grow through sustained, incremental innovation; and
- Social – which may be nonprofit or hybrid organizations.
These different entrepreneurial cultures are likely to have different motivational and personality profiles associated with them. Experts agree there’s no one way to be an entrepreneur. In his book ‘Entrepreneurial DNA’, Joe Abrahams identifies four primary types, with different profiles of personalities and skills:
- ‘Builders’ are driven to create highly scalable businesses rapidly, by focusing on infrastructure. They are authoritarian, compelling personalities, drawing customers, investors, and talent to them like magnets.
- ‘Opportunists’ are masters of promotion, marketing, and selling. They are highly attuned to possibilities, and willing to take large risks for large gains.
- ‘Specialists’ leverage their expertise and unique skills to build their ventures, drawing on personal contacts and experience; they are generally more risk averse than other entrepreneurs, and may plateau early.
- ‘Innovators’ begin with an idea they love, and build on it to create a business venture; they are often more invested in growing the idea than the business.
While we can identify each type in large, visible corporations, we can see how these types roughly correspond to Blank’s four cultures: Builders are more likely to be motivated to create scalable startups, Opportunists will find their groove in large companies which survive on marketing and gradual incremental innovation; Specialists are likely to build small, niche businesses; and Innovators are likely to be more driven by low or non-profit, social development projects.
What all the types have in common is motivation: the need to achieve, whether the drive is towards power, income, personal fulfillment, or contribution to society.
Entrepreneurism Is A Path, Not A Profile.
“A ship in the harbor is safe, but that is not what ships are built for.” – John A. Shedd
There is a huge literature on entrepreneurship, written by psychologists, economists, business strategists, and entrepreneurs themselves. The single most consistent aspect emerging from this mass of theory and research is motivation. Whoever you are, whatever your skills, whatever sector or industry you choose, wanting it is what matters. It doesn’t even really matter what ‘it’ is: the single key trait differentiating entrepreneurs is being driven by a goal, an idea, a dream.
Ultimately, while it may come more naturally to some people than others, taking risks, being proactive, and shooting for the moon are choices. Whatever your personality, your vision is what matters: if it means enough to you, you will find one of those many roads to Rome.