To profile demographic features of entrepreneurs from around the globe
To identify and discuss the most commonly cited characteristics found in successful entrepreneurs
To examine entrepreneurial psychology
To discuss the ‘dark side’ of entrepreneurship
To identify and describe the different types of risk entrepreneurs face
To identify the major causes of stress for these individuals and the ways they can handle stress
To discuss important aspects with respect to an entrepreneurial career
The entrepreneurial mind-set: Cognition and career
1. Entrepreneurs like zeroing
in on a target
• You identify other people’s needs
• Build a product that meets those needs
• Repeat until you get it right.
• You are intensely committed
• Determined perseverance
• Optimistic
• Burning with competitive desire
4. Objectives
1. To profile demographic features of entrepreneurs from around the globe
2. To identify and discuss the most commonly cited characteristics found in
successful entrepreneurs
3. To examine entrepreneurial psychology
4. To discuss the ‘dark side’ of entrepreneurship
5. To identify and describe the different types of risk entrepreneurs face
6. To identify the major causes of stress for these individuals and the ways
they can handle stress
7. To discuss important aspects with respect to an entrepreneurial career
5. But first
What kind of person in their right mind
would possibly take on the stress and
effort of starting a new business, not
being certain of its success, risking their
own money, threatening their sanity, and
even endangering their marriage or
family life!!!?
?
6. The entrepreneurial mind,
behaviour and career
•What ae the most common
characteristics associated with successful entrepreneurs?
•What is the ‘dark side’ of entrepreneurship?
•What are the capabilities that shape the entrepreneur’s career?
•Examining the entrepreneurial mind provides an interesting look
at the entrepreneurial potential within every individual.
•We believe that every person can become the sole proprietor of
their own destiny at some point in their lives and carve out a
career in entrepreneurship.
7. Top two reasons
for becoming an entrepreneur
• Opportunity-driven entrepreneurs
– Achievement, opportunity and money
– Strong desire to be independent
– bored with the same work every day
– Want to be their own bosses
• Necessity-driven entrepreneurs
– Coming out of some kind of adversity
– Made redundant
– Lost pension in GFC
– No better choice than to become an entrepreneur
8. Men and women involved
in early stage ventures
• Which regions have the largest
disproportional representation
between men and women
entrepreneurs?
• Does that surprise you?
• In our region, best performer is
Indonesia with 26 percent and 25
percent for men and women
respectively
• Worst performer is Japan with 5
percent and 3 percent for men and
women respectively.
?
9. Ages of
entrepreneurship
• Which has the
highest youth
rate?
• Highest rate of
seniorpreneurshi
p?
• Greatest drop-off
rate?
• Which age
group has
highest
proportion?
?
10. Entrepreneurs like zeroing
in on a target
• You identify other people’s needs
• Build a product that meets those needs
• Repeat until you get it right.
• You are intensely committed
• Determined perseverance
• Optimistic
• Burning with competitive desire
11. Who are entrepreneurs?
‘A person who habitually
creates and innovates to
build something of
recognised value around
perceived opportunities.’
Bolton & Thompson
12. Entrepreneurs actually think differently.
• How do entrepreneurs really perceive,
recognise, conceive, judge, sense,
reason, remember and imagine?
• Entrepreneurs use simplifying mental
models to piece together previously
unconnected information that helps them
to identify and invent new products or
services, and to assemble the necessary
resources to start and grow businesses.
13. Rowing to your private island
• Entrepreneur is a real individual with passions,
experiences and knowledge living in a particular
culture and time period.
• ‘Entrepreneurs live in a sea of dreams. Their
destinations are private islands – places to
build, create and transform their particular
dreams into reality. Being an entrepreneur entails
envisioning your island and even more
important, it means getting in the boat and
rowing to your island’.
– Shefsky, L. E. (1994). Entrepreneurs are made not
born. New York: McGraw-Hill
14. Characteristics attributed
to entrepreneurs
• Psychologists
have put
together a set
of profile
dimensions that
characterise
entrepreneurs.
Determination, perseverance
Drive to achieve
Opportunity orientation
Persistent problem solving
Seeking feedback
Internal locus of control
Tolerance for ambiguity
Calculated risk taking
Tolerance for failure
High energy level
Creativity and innovativeness
Vision
Passion
Team-building
15. The dark side of entrepreneurship
• Do entrepreneurs suffer more from
mental disorders?
• Does it take a little bit of madness to
start a business?
• Can a business can drive one a little
bit mad?
?
16. • Criminal entrepreneurs
– Dishonest entrepreneurs.
– Opportunists who either adopt a flawed
strategy or fail to deliver
– Empire-builders who grow too quickly and
lose control
– Entrepreneurs who make mistakes, or whose
business fails, but who determinedly make a
comeback
– Entrepreneurs who attract controversy
The dark side of entrepreneurship
Marlon Brando
in the Godfather
17. Entrepreneurial risks
Financial risk – exposure to bankruptcy
Career risk – Can’t go back to old job
Family and social risk – missing out
Psychic risk – psychological impact of failure
18. What were your best failures
• Can you tell us one failure that you
learned from?
• Accept your failures and do not be
devastated by them.
• VCs in Silicon Valley ask “Have you
failed yet?”
• (You have to answer yes to get funding.)
• What did you learn from them?
?
19. Entrepreneurs and stress
• ‘Type A’ behaviour
– Impatient, demanding and overstrung
– Chronic and severe sense of time
urgency
– Constant deadlines in multiple projects
– Neglect other aspects of life
– Take on excessive responsibility
• Linked to coronary heart disease
20. The social entrepreneur
How would the mind-set of the social
entrepreneur differ from a business
entrepreneur?
?
21. Entrepreneurial ego
• Overbearing need for control
– Entrepreneurs are driven by a strong need to
control both their venture and their destiny.
Preoccupation with controlling everything.
• Sense of distrust
– To remain alert to competition, entrepreneurs
are continually distrustfully scanning the
environment.
• Overriding desire for success
– Entrepreneurs believe they are living on the
edge of existence, strong desire to succeed
in spite of the odds.
• Unrealistic optimism
– The ceaseless optimism that emanates from
entrepreneurs (even through the bleak times)
22. Your entrepreneurial career
• Involves creating ventures
• You don’t just produce a venture;
it comes out of you with pain and
excitement
• You don’t somehow pre-exist as
an entrepreneur; you emerge . . .
• Venture creation is a lived
experience that, as it unfolds,
forms you
• You heaps of need self-efficacy.
24. Key concepts
1. How would you describe the mind-
set of the entrepreneur?
2. What aspects of an entrepreneur’s
mind-set might affect their
relationships with other people?
?
To profile demographic features of entrepreneurs from around the globe
To identify and discuss the most commonly cited characteristics found in successful entrepreneurs
To examine entrepreneurial psychology
To discuss the ‘dark side’ of entrepreneurship
To identify and describe the different types of risk entrepreneurs face
To identify the major causes of stress for these individuals and the ways they can handle stress
To discuss important aspects with respect to an entrepreneurial career
Bullseye. Work found at http://pixabay.com/p-155726 CC0 Public Domain
5
Define: entrepreneurial mind -- Describes the mind of an entrepreneur and the way they think about, make decisions and view the world and its opportunities for new ventures.
Let’s take more personal look at entrepreneurs.
What ae the most common characteristics associated with successful entrepreneurs as well as elements associated with the ‘dark side’ of entrepreneurship?
What are the capabilities that shape the entrepreneur’s career?
Examining the entrepreneurial mind provides an interesting look at the entrepreneurial potential within every individual.
We believe that every person can become the sole proprietor of their own destiny at some point in their lives and carve out a career in entrepreneurship.
There are two top motivations to become and entrepreneur.
Opportunity-driven entrepreneurs. Most entrepreneurs have a strong desire to be independent. Want to be their own bosses and wealth may be part of the motivation. Entrepreneurs believe it is better to invest in themselves. Job satisfaction, achievement, opportunity and money are often thought to be primary motivations for people to launch their own venture.
Necessity-driven entrepreneurs have no better choice than to become an entrepreneur. Their decision to start a business comes out of some kind of adversity. Maybe one person in a two-person family is transferred and the other becomes the ‘trailing spouse’. Their job is made redundant. Needs are not being met.
We often see the most entrepreneurial people to be youth, Indigenous people or immigrants; for example, female Indian immigrants in London, Chinese in Singapore, gays in Sydney or San Francisco, Palestinian in the Arab Gulf or even enterprising religious minorities, such as Sikhs in Australia.
Opportunity entrepreneur: Work found at http://pixabay.com/p-696962. Cropped. CC0 Public Domain
Necessity entrepreneur: Work found at http://en.wikipedia.org/wiki/Sales#/media/File:Salesman_-beach_-_bikini-_sun-27Dec2008.jpg This image, which was originally posted to Flickr.com, was uploaded to Commons using Flickr upload bot on 19:33, 8 January 2009 (UTC) by Snowmanradio (talk). On that date it was licensed under Attribution 2.0 Generic
Figure 2.1 shows the proportional representation of men and women involved in early stage ventures across regions. The proportion of women entrepreneurs is only 6 percent of women in the Middle East, North Africa and the European Union and as high as 26 percent in Sub-Saharan Africa.
The variation among men on the other hand is as low as 11 percent in the European Union and as high as 27 percent in Sub-Saharan Africa.
In the Asia-Pacific and South Asia women participation rates are 11 percent and for men, 14 percent.
Within the Asia–Pacific region, the highest participation rates were in Indonesia with 26 percent and 25 percent for men and women respectively while the lowest was recorded in Japan with 5 percent and 3 percent for men and women respectively.
Australia was not accounted for in the 2013 survey although in 2011, Australia’s TEA Index was 10.5 percent .
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One of the hottest topics in the research literature is entrepreneurial cognition: entrepreneurs actually think differently from other people.
Cognition refers to mental processes, including attention, remembering, producing and understanding language, solving problems and making decisions. It means the ability to process information, apply knowledge and change preferences.
It’s about situation-based mental models (cognitions) that optimise personal effectiveness.
Entrepreneurial cognition as the knowledge structures that people use to make assessments, judgements, or decisions involving opportunity evaluation, venture creation, and growth.
Entrepreneurs use simplifying mental models to piece together previously unconnected information that helps them to identify and invent new products or services, and to assemble the necessary resources to start and grow businesses.
13
DETERMINATION AND PERSEVERANCE: Total dedication to success and focus on advantage can overcome obstacles and setbacks. Sheer determination and a stubborn, unwavering commitment to succeed often wins out against odds that many people would consider insurmountable.
DRIVE TO ACHIEVE: Entrepreneurs are self-starters who appear to others to be internally driven by a strong desire to compete, to excel against self-imposed standards and to pursue and attain challenging goals.
OPPORTUNITY ORIENTATION: Focus on opportunity rather than on resources, structure or strategy. Opportunity orientation is the constant awareness of the opportunities that exist in everyday life.
PERSISTENT PROBLEM SOLVING: Entrepreneurs are not intimidated by difficult situations. In fact, their self-confidence and general optimism seem to translate into a view that the impossible just takes a little longer.
SEEKING FEEDBACK: Effective entrepreneurs desire to know how well they are doing and how they might improve their performance.
INTERNAL LOCUS OF CONTROL: Successful entrepreneurs believe in themselves. They do not believe the success or failure of their venture will be governed by fate, luck or similar forces.
TOLERANCE FOR AMBIGUITY: Entrepreneurs thrive on the fluidity and excitement of such an ambiguous existence and generally have a high tolerance for ambiguity.
CALCULATED RISK TAKING: Successful entrepreneurs are not gamblers – if they decide to participate in a venture, they do so in a very calculated, carefully thought-out manner. Get the odds in their favour.
TOLERANCE FOR FAILURE: Entrepreneurs use failure as a learning experience and generally have a high tolerance for failure.
HIGH ENERGY LEVEL: Many entrepreneurs fine-tune their energy levels by carefully monitoring what they eat and drink, establishing exercise routines and knowing when to get away for relaxation.
CREATIVITY AND INNOVATIVENESS: Creativity was once regarded as an exclusively inherited trait. It is less a genetic trait than a cultural characteristic – one that can be learned.
VISION: Entrepreneurs know where they want to go. They have a vision or concept of what their business can be.
PASSION: Entrepreneurial passion is a fundamental emotional experience for entrepreneurs.
TEAM-BUILDING: The desire for recognition and autonomy does not preclude the entrepreneur’s desire to build a strong entrepreneurial team.
Personality testing: Work found at http://en.wikipedia.org/wiki/Oxford_Capacity_Analysis#/media/File:Free_personality_testing.jpg CC BY-SA 2.0 Creator: Thomas Hawk from San Francisco, USA
3/6/2017
Bolton and Thompson even have an entire chapter entitled ‘Entrepreneurs in the shadows’. They examine:
opportunist entrepreneurs who either adopt a flawed strategy or fail to deliver
inventors who become failed entrepreneurs as they lack key project championing capabilities
empire-builders who grow too quickly and lose control – sometimes involving a creative cover-up strategy
entrepreneurs who make mistakes, or whose business fails, but who determinedly make a comeback
entrepreneurs who attract controversy
dishonest entrepreneurs.
Godfather: Work found at https://c4.staticflickr.com/8/7226/7046992619_a4bc86cd67_b.jpg Rotated. Attribution 2.0 International (CC BY 2.0).
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Chronic and severe sense of time urgency. For instance, type A people become particularly frustrated in traffic jams.
Constant involvement in multiple projects subject to deadlines. Type A people take delight in the feeling of being swamped with work.
Neglect of all aspects of life except work. These workaholics live to work rather than work to live.
A tendency to take on excessive responsibility. Often combined with the feeling that ‘only I am capable of taking care of this matter’.
Explosiveness of speech and a tendency to speak faster than most people. Type A people are prone to ranting and swearing when upset.
Stress: Work found at https://www.flickr.com/photos/sundazed/2245308099 Creator: Katy Warner. Attribution 2.0 International (CC BY-SA 2.0
3/6/2017
Negative effects of having an ego, especially in countries that value modesty and circumspection, may hold destructive implications for entrepreneurs.
Overbearing need for control: Entrepreneurs are driven by a strong need to control both their venture and their destiny. This internal focus of control spills over into a preoccupation with controlling everything.
Sense of distrust: To remain alert to competition, entrepreneurs are continually distrustfully scanning the environment. Overriding desire for success: Entrepreneurs believe they are living on the edge of existence, constantly stirring within them is a strong desire to succeed in spite of the odds.
Unrealistic optimism: The ceaseless optimism that emanates from entrepreneurs (even through the bleak times) is a key factor in the drive towards success.
I am right: Work found at http://pixabay.com/en/i-self-esteem-self-liberation-741509/ CC0 Public Domain
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Table 2.1 helps clarify the nature of entrepreneurial capabilities as they vary across the different stages of entrepreneurial activity.
In the table, the stages of the business – nascent (preparing for business start-up), survival (hanging on) and growth (powering ahead) – can be compared with the entrepreneurial characteristics that are needed for success.
Higher education and experience (e.g. previous industry and management roles) help through all three stages.
Planning is a strong influencer during the growth stage but does not play a significant part during nascent and survival stages of a venture.
Risk propensity and opportunity propensity are apparent characteristics during the nascent stage.
Self-efficacy and entrepreneurial passion are more evident and noteworthy capabilities for the survival stage.
3/6/2017
This is linked to the self-assessment tool http://www.bdc.ca/EN/articles-tools/entrepreneur-toolkit/business-assessments/Pages/self-assessment-test-your-entrepreneurial-potential.aspx