A study uncovers the DNA of the entrepreneur.
Entrepreneurs are the lifeblood of the global market; their drive to create and grow new companies is what makes the system work. But not everyone is running out and starting new businesses all the time—it takes a certain kind of person to turn an idea into a business. You might think you should start a business because you have a great idea, but will you truly be able to make your business succeed?
Just what, exactly, are the precise traits and behaviors that characterize entrepreneurial leaders? That’s the question Ernst & Young set out to answer in its 2011 survey “Nature or Nurture? Decoding the DNA of the Entrepreneur.” Ernst & Young surveyed 685 entrepreneurs and conducted in-depth interviews with winners of the firm’s Entrepreneur of the Year award, and found that entrepreneurs share certain distinct personality traits. The report lays out these characteristics as a DNA model.
The Core Mindset
At the core of the entrepreneurial model are two opposing attitudes: an opportunistic mindset and an acceptance of risk and potential failure. Where most people see disruptions, entrepreneurs see opportunities. Their willingness to take on risk and possibly fail is what allows them to grab these opportunities.
Holding this core mindset together is what Professor Manfred F. R. Kets de Vries, founder of INSEAD’s Global Leadership Centre, calls an “internal locus of control”: the belief that events are a direct result of an individual’s actions (as opposed to an “external locus of control,” where events are seen as the result of outside circumstances). This can-do attitude allows entrepreneurs to keep trying over and over until they succeed.
The Six Behaviors
The survey identifies six behaviors that surround entrepreneurs’ core mindset*:
1) Drive, tenacity, persistence
You must continue to try, even in the face of resistance.
2) Be the architect of your own vision: passionate and focused
You must have a clear vision in order to attract employees and investors.
3) Build an ecosystem of finance, people and know-how
You must create the right environment to pull together investors and build fruitful partnerships so that the business grow and thrive.
4) Seek out niches and market gaps
You must identify unmet needs and fill them quickly.
5) Live what you believe: build success, culture and values
You must hold an unwavering set of values and seek out others who share these values.
6) Nonconformist and a team player
You must play by their own rules, but you can’t do it alone: your success depends on working with others.
*All numbered terms taken directly from the E&Y report. The explanations are mine.
The Other Attributes
Finally, the outermost ring of entrepreneurs’ DNA is formed by the attributes that lead them to bravely face the inevitable challenges ahead and create their own luck: resilience, teamwork, innovation, passion, leadership, integrity, quality, customer focus, flexibility, and vision.
These traits can be learned
You may be looking at this model and thinking, I don’t have all of those characteristics. Am I not meant to be an entrepreneur? Not to worry; not everyone who succeeds is strong on all of these traits, and the traits are not inherent.
While it may seem entrepreneurs were just born different, the Ernst & Young report says these characteristics are formed through the entrepreneurs’ surrounding culture, environment and experience. They conclude, “Put simply, nurture is more important than nature in shaping the entrepreneurial mindset.”
This DNA model is a simple way to identify where your entrepreneurial strengths and weaknesses are. Maybe you’re very driven, but you don’t know how to attract investors. Maybe you’ve found a market gap, but you’re having trouble explaining your vision to others. Maybe you’re value-driven, but you’re uncomfortable making up the rules as you go. Determine the areas that are most challenging for you, and then focus on developing those traits.
In future posts, I’ll go into detail about the six behaviors surrounding the core mindset. I’ll offer real-life examples of these behaviors in action and suggest ways to practice these behaviors in your own life. Stay tuned.