Lessons from Global Entrepreneurship Week: What makes a successful entrepreneur

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Courtney Keating/iStock
Rachael Power
Small Business Editor
Sift Media
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Every year for the last six years, Amway Global Entrepreneurship Report (AGER) rounds up the sentiments from around the globe on entrepreneurship.

This year, it surveyed around 50,000 people from 44 countries, gaining an insight into how entrepreneurs feel about starting a business, what they’re most afraid of and it also examines why males are more optimistic about starting a business than women.

It also, for the first time, examines entrepreneurial spirit in three dimensions including desirability, feasibility, and stability against social pressure derived from psychologist Icek Ajzen’s Theory of Planned Behavior.

This found countries with a higher “entrepreneurial spirit” were more positive about entrepreneurship and its potential and rates of self employment. Great Britain was seen as the fourth most entrepreneurship-friendly country and had a ‘spirit’ score of 48.

Around the same time, cloud accounting firm Xero commissioned a report into 2,000 US and UK businesses, to discover what sets entrepreneurs who fail apart from those who succeed.

While it’s reassuring to know that globally, most feel positive about being an entrepreneur, 70% are still saying the fear of failure would put them off starting up.

BusinessZone took a look at both reports and what you need to bear in mind if you’re afraid of failure.

Positivity = success

According to the report the fear of failure was a “significant hurdle” and men and women, particularly in a younger age group, fared equally here.

But around 75% of respondents held positive attitudes toward entrepreneurship. In 2015, 81% of those under 35 were the most optimistic.

Business psychologist and positive psychologist Viv Thackray-Dutton said from a psychology perspective, this positivity really stood out to her as being a factor in what makes a successful entrepreneur.

“Those with a positive view of entrepreneurship are more likely to have developed the skills and habits to be resilient when things don't go to plan, so they know that whatever setbacks come their way, they will be able to weather the storm and bounce back from adversity.

“Some psychologists argue that resilience is a better predictor of success than IQ. Resilient people are more likely to be able to dispute negative thinking around fear of failure and also to think of occasions in the past when they were uncertain of success but triumphed due to persistence and relate such experience to future projects, such as starting a business,” she told BusinessZone.

And those who have a more positive approach are more likely to be growth-focused, Thackray-Dutton added.

“Those with a growth mindset view failure as a learning opportunity, that's not to say that they don't feel the same emotions that others do when failure occurs, but they are able to look ahead and think about what they will do differently next time.

“For people with a growth mindset, failure is not all defining. Individuals with a growth mindset possess a positive approach to life and are open to learning new things and so take on new challenges wholeheartedly, which makes them ideal candidates for starting their own businesses.”

The male - female divide remains

Earlier in the year, the Department for Business, Innovation and Skills commissioned a report into the sociology of enterprise. It found that for a variety of reasons, female startup owners were less likely to want to grow their business.

Among the numerous reports carried out into female entrepreneurship this year, the Irish government wrote about the barriers to women going into business in the Republic, including the male-oriented tax system and lack of young girls taking up technical subjects at secondary school and university level.

According to the AGER, 43% of the 50,000 people surveyed said they could imagine starting a business. Of this number, men (47%) were more willing than women (38%). University degree holders and those under 35 years (each 51%) showed the most potential.

Those with a growth mindset view failure as a learning opportunity

In addition, their index which measures three dimensions that influence a person’s intention to start a business showed that over half of the average expressed the desire to become an entrepreneur; 47% felt prepared for entrepreneurship, and 49% would not allow their social networks to dissuade them. Men (54) had higher scores than women (47) here too.

While there’s much being done to support female entrepreneurs at a global, EU and UK level, there’s always more we can do to close the gender gap. Check out BusinessZone’s guide to help and support for female entrepreneurs for more information.

Entrepreneurial characteristics

‘What makes an entrepreneur?’ is a question we’re often asked here at BusinessZone.

While we know they come in all shapes and sizes, the AGER says the 50,000 respondents saw entrepreneurs as people who “like to learn things” (84%), “want to enjoy life” (78%) and “like to be in charge and tell others what to do” (75%).

They’re also characterised as people who “look for adventures and like to take risks” (70%) and “like to stand out and impress other people” (68%).

There were a lot of varying reasons why the respondents believed people would start a business. Mostly it was “being my own boss”, followed by self-fulfillment. Those under 35 thought independence was more important than older entrepreneurs did.

Amway added that it found all factors to starting a business were less appealing in countries with greater cultural intolerance for uncertainty. And in countries with higher economic output, respondents rate self-fulfillment as a stronger reason for entrepreneurship.

Other success factors

As 60% of startups close within five years, Xero recently surveyed 2,000 US and UK small business owners, a section of which were failed businesses. They found successful businesses were more aware of alternative finance options, invested more in tech and marketing and valued family time and ‘switching off’ as vital to their success.

They also found:

  • Successful entrepreneurs were mainly those selling services and those selling products fared worse with a 41% failure rate
  • Successful entrepreneurs have mentors - only 14% of failed businesses had a mentor compared to a third of successful businesses
  • Successful entrepreneurs (49%) spent money on marketing campaigns compared to only 20% of failures, and spend more on customer service
  • Around 65% of failed businesses blamed financial issues
  • Over half of successful business respondents had a corporate position before taking the plunge into entrepreneurship.

A few years ago, BusinessZone wrote how failure was something to be embraced, not feared and it looks like it still stands. If you go by Thackray-Dutton’s words and build your resilience, take some tips from Xero’s failed businesses by spending on marketing and customer service as well as keeping a better track of your finances, you can weather the storm and potentially be a success.

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