The Entrepreneur Gene

In order to find out if there actually is a physiological entrepreneur gene, or if it is simply a clever expression to categorize the people who have a knack for succeeding in business, we have to navigate through a very large amount of research, books, essays, blogs and interviews.

To make things even more interesting, this subject sparks up a debate which has always been very hot: the controversial «Nature vs. Nurture» idea. Generally, there are firm believers of three different theories; 100% Nature, 100% Nurture, and 50% of both Nature and Nurture. But in this case, who’s right; some, all, or maybe none!

Follow me on the exploratory path of this question, which will eventually have a great impact on every aspect of the business world, especially for the financial decision-makers who must be very efficient at recognizing the patterns underlying their decisions about which entrepreneurs to finance.

Ideologies are definitively the fuel of discussions … but in the end, money talks.

First, let’s find out what actions people take when they decide to launch a business. After a lifetime of being an entrepreneur and evolving in the business world, I have found that we do a lot of the same things. Here are the most common (and helpful) ones:

• Be comfortable taking risks
• Be ready to make a lot of sacrifices
• Dedicate yourself 110% to your business
• Push through and avoid all other distractions
• Set realistic goals
• Cultivate a strong network before leaving your work or selling your current business
• Choose something you are passionate about
• Prepare a business plan while you are still working or operating your current business
• Don’t have a Plan B, since it is the best excuse to quit before succeeding
• Find at least one important thing that sets out apart from your competitors
• Learn to sell (products, services, concepts, ideas, or yourself)
• Find inside and/or outside partners
• Never hesitate to ask for help
• Find a mentor
• Accept to have your ideas challenged by trustworthy, competent and experienced people
• Start out simple, without office space and employees
• Be very patient and expect at least a year before the first results appear
• Make sure you have the necessary amount of money aside to last until the business is planned to start being profitable

Second, let’s examine the common personality traits found in most successful entrepreneurs. According to the blended studies on this subject, they are as follows:

• Ability to recognize opportunities
• Adaptable
• Believes in one’s ability to succeed
• Confident
• Creative
• Determined
• Driven
• Energetic
• Evaluates endless possibilities
• Extroverted
• Hard-working
• High EQ (Emotional Quotient)
• High tolerance for uncertainty
• Independent
• Insightful
• Intuitive
• Magnetic personality
• No fear of failure
• Open to new ideas
• Optimistic
• Quickly learns from their mistakes
• Resilient
• Seeks new experiences
• Self-sufficient
• Strong leader
• Surrounds one’s self with like-minded people
• Thrives on challenges
• Tolerant to risk

«I can’t answer the nature/nurture question. But if a person’s background and intuition don’t make her/him comfortable with risk, resilient in the face of ridiculously challenging circumstances, unreasonably optimistic about the future, and instinctively inclined to put two feet on the ground happily every morning, they aren’t likely to be counted in the successful entrepreneur column.»
– Trish Karter, president and founder of Dancing Deer Bakery in Boston

Third, we find out the results of thousands of studies on the entrepreneur gene conducted on identical and fraternal twins, compiled by Scott Shane, a behavioral economist and professor of entrepreneurial studies at Case Western Reserve University, in collaboration with a team at King’s College in London, led by Tim Spector, head of the department of twin research and genetic epidemiology:

• A person’s ability to recognize new opportunities is 45% inherited
• A lust for novel experiences is 50% to 60% inherited
• Openness to new challenges is 45% to 61% inherited
• Extroversion is up to 66% inherited
• Entrepreneurship, with all its causes lumped in, is between 30% and 40% inherited
• Thousands of genes could be involved
• People with low levels of the “feel good” chemical dopamine in their brains are more likely to seek new or novel activities, such as starting a business
• One mutated gene involved in handling dopamine makes people more likely to take risks
• Ten to 15 years from now, genetically advantaged entrepreneurs might be identified through DNA testing or psychological surveys
• Drugs used to manipulate dopamine levels might be used to enhance entrepreneurship

«Almost everything is genetic. But everything is environmental, too. Take your favorite entrepreneur and put him in a bad environment, and he won’t do much. Think of entrepreneurship as we do height, which is determined by a lot of genes and environment, particularly diet.»
– George Church, Harvard professor and pioneer in developing DNA-sequencing technology to read genetic codes.

Fourth, we look into the background factor of this issue:

• 54% of entrepreneurs were the first in their immediate family
• 39% had an entrepreneurial father
• 7% had an entrepreneurial mother
• 7% had both entrepreneurial parents
• Start-ups by university graduates have 5-6 times more sales and employees than start-ups by high school graduates
• Of the 1,210 Forbes billionaires worldwide, 830 made their cash from scratch, including Oprah and Bill Gates

«I believe that we are all born with the ability to be an entrepreneur, but we have to unlearn the risk-averse behavior that became part of our culture in the developed world over the past 500 years. As information and communication technologies tear down these barriers, we will see a full circle as billions of people will be empowered to express their entrepreneurial genes.»
– Frank Moss, director of the Media Lab at the Massachusetts Institute of Technology (M.I.T.) and former CEO of Tivoli Systems as well as co-founder of Stellar Computer and Infinity Pharmaceuticals

In conclusion, I mostly agree with Mr. Moss. I believe there is definitively an important genetic component to being a successful entrepreneur, but the environment in which a person evolves makes a huge difference. For some it is the family, others the friends and finally education, training and experience play the largest role in that area.

I encourage everyone who feels the urge to become an entrepreneur to do everything in their power to make that very exciting dream come true.

I invite you to visit this page of our website to find out if you have what it takes to be an entrepreneur and thrive in the freedom of owning your own business.

For more in depth and detailed information, Phoenix Alliance offers a FREE specialized «How to realistically evaluate someone’s chances of success» seminar to its registered members.

Interesting outside link: « Entrepreneurs: The ‘Business’ Gene »