Entrepreneurs have always held a special place in the business world. They’re the lone wolves of the industry—the creative, independent, driven stars of startups. When someone mentions the word “entrepreneur,” it inspires feelings of fear, risk, and excitement. Millions of people dream of owning their own successful businesses, but many don’t know what it is that makes entrepreneurs the way they are. New research gives us an insider’s look into the entrepreneurial mind, shedding light on the mystery of what makes successful business owners.
The Heart of an Entrepreneur
Disclaimer: there’s no perfect formula for entrepreneurship. Each person is different from the next and brings a unique set of psychological characteristics to the table. Successful business owners range from the strong, resilient type (think Oprah Winfrey) to the weird and introverted type (e.g., Mark Zuckerberg). What makes you a successful entrepreneur isn’t necessarily the traits you’re born with but what you do with the traits you have. Passion, gumption, and a heart for the industry are what make true entrepreneurs. That being said, there are a few typical characteristics most entrepreneurs do have in common.
Propensity to Take Risks
Serial entrepreneurs repeatedly take risks in the professional world. Starting a business is a leap of faith that consumers will respond well to your idea and make you a success story. Starting one business seems difficult enough, yet many entrepreneurs do it over and over again. What drives entrepreneurs to continue starting new businesses once they’ve failed or succeeded with others is their desire to invest in risky ventures. The important thing to remember is that entrepreneurs take calculated risks that will move their businesses forward, not careless risks just for the sake of doing something dangerous.
Entrepreneurs rarely make impulsive or spur-of-the-moment decisions. What looks like an extreme decision from the outside is typically a carefully planned and calculated business move. The greater the risk, the bigger the returns. Entrepreneurs understand this balance and know where to invest their money for the greatest likelihood of a profit. Entrepreneurs likely don’t see themselves as high risk takers—instead, they see themselves as people with a positive outlook for the future. Which leads us to trait number two…
Positivity and Confidence
What drives entrepreneurs to continue even after a startup has failed? Their relentless positivity. If you’ve ever spoken with an entrepreneur, odds are you noticed how upbeat, positive, and confident he or she seemed. This isn’t a façade—research shows that entrepreneurs typically have more positive personalities than other people. It’s difficult to tell if positivity drives success or if it’s the other way around, but one thing is for sure: entrepreneurs don’t let negative thinking get them down.
If you aren’t confident in yourself or your idea, you can’t expect others to be. A positive attitude translates into self-confidence and provides the calm, cool, and collected aura entrepreneurs often exude. A high level of confidence enables entrepreneurs to get the job done even under less-than-desirable or stressful conditions. Where others see an impossible challenge, entrepreneurs see an opportunity for big rewards. Positivity and confidence are the cornerstones of the entrepreneurial state of mind.
Need for Achievement
The driving force behind every entrepreneur’s actions it the need for achievement. A thirst for success and meeting goals inspires entrepreneurs to start their own businesses—a mega-task that’s only possible with determination. The most successful business owners didn’t have victory handed to them on a silver platter. They work hard for success, striving for feelings of personal accomplishment more than for profit. Entrepreneurs only involve themselves in businesses when there’s a high chance of growth and success because these investments speak to their own inner needs for achievement.
The need for achievement is what pushes entrepreneurs to set goals and take actions to meet them. Often, this need stems from a place of lifelong aspiration—to make a difference in the world, pursue a passion, or fill a gap in a niche. Entrepreneurs constantly look for new opportunities in their industries, generating fresh ideas and turning them into solid business plans. The desire to be successful goes a long way toward building an enterprise.
Internal Locus of Control
The common characteristic that refers to an individual’s perception of the reasons for events in life is known as the internal locus of control. In an entrepreneurial regard, the locus of control represents the belief that the entrepreneur’s own actions control the success of his or her business. Entrepreneurs don’t hold much stock in luck or fate. Instead, they firmly believe their success is the direct result of their own hard work.
The internal locus of control increases an entrepreneur’s comfort and confidence in making important business decisions. Instead of blaming outside forces for a success or failure, entrepreneurs blame their own actions. While this character trait tends to drive decision-making and company growth, it can also lead to a sense of personal failure if things don’t go as planned—even if there’s a good reason for the problem.
Tolerance for Uncertainty
In the world of startups, nothing is for sure. Entrepreneurs have no way to know how much of a success or failure an idea will be until their companies launch and either tank or go viral. This level of uncertainty about the future discourages many people from ever trying to become entrepreneurs. If you’re a fan of operating within the known boundaries of a well-established business, entrepreneurship may not be in your future.
Entrepreneurs embrace the ambiguity and uncertainty of starting one’s own business, using the exhilaration of risk to fuel innovation and creative problem solving. There’s often incomplete information in the world of entrepreneurship. Markets, competitors, cash-flow…these areas of business are cloudy. Entrepreneurs are comfortable making decisions without seeing the full picture. In fact, they prefer to conduct business this way—with a flair for the unknown and the challenging.
Become an Entrepreneur
Every successful business owner wasn’t necessarily born to be an entrepreneur. If you’re one of many people who don’t feel like they have these natural psychological characteristics, don’t let this stop you from starting your own business. Anyone can be an entrepreneur with the right mindset. Now that you know the main psychological traits of most magnates, you can emulate their behaviors and become one.
You likely have more in common with entrepreneurs than you think. If you have the urge to make a change in your work life or if you’ve always dreamed of bringing a service or product to life with your own unique spin, you’ve already taken the first step. Quitting your job and starting a company is a risk you should only take with the proper education and market knowledge. A person may have all the psychological traits of a mogul and may still fail. It’s up to you to have the determination and attitude to get up and try again. The only person who can stop you from becoming an entrepreneur is you.