How Science Defines the Ideal Attitude for an Entrepreneur

There’s a popular notion that entrepreneurs possess innate qualities rather than acquiring them through learning. However, we disagree with this belief. Entrepreneurship is a skill that anyone can acquire. Nonetheless, certain foundational abilities and a suitable mindset are necessary prerequisites.

Interestingly, research conducted by the University of Oklahoma in 2016 suggests that optimism plays a significant role in an entrepreneur’s success. Particularly in challenging economic times, entrepreneurs tend to rely more on optimism and seek advice from fellow entrepreneurs rather than solely relying on market data when making business decisions. 

Surprisingly, these instinctive decisions based on gut feelings have proven effective in as many as 90% of cases.

With dedicated effort, it is possible to cultivate an entrepreneurial mindset and acquire the necessary foundational skills before embarking on the journey of starting your own business.

Scientific research has identified the key attributes required to foster an ideal entrepreneurial mindset.

Develop the right behaviors

Harvard Business School conducted a study that analyzed the behaviors exhibited by entrepreneurs and compared them to those of individuals who were not involved in entrepreneurship.

In their research, Harvard Business School identified 11 essential skills and behaviors that apply to entrepreneurs and employees. The study assessed the performance of each group in these areas and found that entrepreneurs excelled in several aspects. However, there was no notable distinction between entrepreneurs and employees regarding team motivation, decision-making, collaboration, operational management, or sales proficiency.

The research findings indicate that the primary distinction between entrepreneurs and employees lies in their attitudes rather than their hard skills.

Entrepreneurship thrives within a realm of unpredictability. One must forge their own path, secure funding for their product, and navigate financial challenges when clients delay or fail to make payments.

This venture is filled with risks and surprises, which entrepreneurs view as thrilling rather than daunting.

If the idea of such a journey is not as enjoyable to you, then entrepreneurship may not be the right path.

Harvard’s study provides evidence that anyone can become an entrepreneur, emphasizing the importance of adopting entrepreneurial behaviors to embark on this path successfully.

Learn how to be resilient

Resilience, a vital characteristic of thriving entrepreneurs, refers to the ability to adapt and cope effectively with challenges and pressures encountered in both personal and professional realms.

It entails overcoming discouragement and persevering through difficult circumstances, which are abundant in the entrepreneurial journey.

Scientists often explore resilience to understand why certain individuals bounce back from adversity and trauma while others struggle to do so.

A comprehensive study conducted over a span of thirty-two years, initially published in 1989 but still applicable today, revealed that a fundamental aspect of resilience lies in the belief of having personal control over one’s circumstances.

Various approaches can be adopted to cultivate resilience, but self-awareness emerges as a vital factor in the process.

Avoid settling for what life presents to you and instead actively shape your own destiny!

Moreover, research has demonstrated that resilience levels are not fixed; they can fluctuate over time.

Even individuals with high resilience can experience a decline in their resilience when confronted with a series of adverse events. However, the crucial factor lies in how you perceive and interpret these events.

It is essential to view every experience, whether positive or negative, as an opportunity for learning and personal growth.

Your mindset and approach to the world play a significant role in determining your level of success.

Thomas Edison embodies a notable example of entrepreneurial resilience. Despite facing more than 10,000 failures, he persevered and ultimately invented the light bulb. His response reflected his unwavering determination in the face of ridicule: “I haven’t failed. I’ve just found 10,000 ways that won’t work.”

A contemporary illustration of resilience can be seen in the remarkable journey of Oprah Winfrey. Despite facing significant adversity, she emerged triumphant and achieved great success.

Challenging circumstances marked Oprah’s early life. Born to teenage parents, she was primarily raised by her grandmother and later moved to a crime-ridden, impoverished neighborhood in Milwaukee to live with her mother.

Although Oprah displayed intelligence as a student, the pervasive violence surrounding her took a toll on her well-being. However, she attributes her father’s insistence on diligent studying and receiving a scholarship to university as life-saving moments that set her on the path to success.

Nevertheless, her unwavering resilience and inner strength played a pivotal role in shaping her into the influential figure she is today.

Be optimistic

The significance of confidence and optimism in captivating others and pursuing ambitious goals is widely acknowledged.

Interestingly, maintaining a positive outlook in general also enhances one’s entrepreneurial aptitude.

Entrepreneurs, who willingly embrace greater risks by venturing into their own businesses, exhibit higher optimism levels than individuals with salaried employment, encompassing various aspects of life.

Notably, millennial small business owners stand at the forefront of this trend, demonstrating a remarkable 26% higher optimism rate compared to their older counterparts.

Indeed, a study published in the Journal of Corporate Finance unveiled that entrepreneurs who exhibited high levels of optimism were more successful in securing funding at favorable interest rates compared to their less optimistic counterparts.

However, it is crucial to note that excessive optimism can distort one’s perception of reality.

Statistically, the harsh reality is that approximately half of all businesses experience failure within the first five years, and only around one-third survive beyond the ten-year mark.

Entrepreneurs have consistently exhibited higher levels of positivity compared to other groups.

A study conducted in 1988 revealed that a significant 81% of entrepreneurs believed their business had a probability of survival exceeding 70%.

Similarly, a study conducted more than two decades later produced similar findings, with 62% of survey respondents overestimating their projected sales for the first year.

However, this research also sheds light on the potential downsides of excessive optimism.

Researchers discovered that extreme optimism could lead to overconfidence among entrepreneurs, prompting them to launch ill-prepared businesses for the market.

Optimism serves as a reliable indicator of entrepreneurial success. However, it can also lead entrepreneurs to make hasty decisions without adequate consideration.

It is equally important to maintain a sense of realism and promptly recognize when things are not unfolding according to the initial plan. This awareness enables entrepreneurs to take immediate action to address any issues or challenges that arise.

Be a problem solver

The importance of problem-solving skills for entrepreneurs cannot be overstated.

Entrepreneurs are confronted with a wide range of challenges, including product-related issues, financial setbacks, and employee management, among others.

In the initial stages of establishing a business, problem-solving becomes an integral part of every entrepreneurial endeavor.

But what is the most effective way to develop problem-solving abilities?

According to scientific findings, simply learning the theoretical aspects of problem-solving is insufficient; one must also gain practical experience. Gradually accumulating experience over time enhances one’s proficiency as a problem solver.

Furthermore, there are numerous approaches and strategies available to tackle problems effectively.

Certain challenges necessitate extensive effort to overcome, resembling an imminent product launch deadline.

In contrast, some issues cannot be resolved solely through determination and effort. When faced with competitors encroaching on your market share, thinking outside the box and discovering alternative avenues to reach your customers is imperative.

The problem-solving approach employed in scientific methodology is highly applicable in the realm of business.

The scientific method encompasses six fundamental steps:

Purpose/Questions

What is the problem? Define it.

One common challenge entrepreneurs encounter is the inquiry of how to expand their business operations.

Research

Seek insights from fellow entrepreneurs who have successfully tackled the same issue through direct conversations or by exploring online resources.

Engage in communities such as mastermind groups or entrepreneur forums to expand your network of valuable professional connections.

Hypothesis

This is a potential solution you have for the problem. You think it might work but aren’t sure yet.

Experiment

Try out your hypothesis.

A genuine scientific experiment involves the testing of multiple variables in comparison to a control group. In the realm of marketing, this practice is commonly referred to as A/B testing.

The process involves creating multiple versions of a webpage, each to convert users into customers or subscribers.

Each variation features distinct elements, such as design, content, or even different images within the same design.

These versions are then presented to an equal portion of the audience, allowing for a comparative analysis to determine which performs more effectively.

Data/Analysis

Once your experiments have concluded, it is essential to analyze the collected data.

Considering the web page example, it is evident that Variation A outperformed Variation B with a conversion rate twice as high, clearly establishing it as the successful outcome of the experiment.

Conclusion

At this stage, you reach a determination regarding the validity of your initial idea, also known as the hypothesis.

After thoroughly analyzing the data, discarding the underperforming page (Variation B) and utilizing the high-converting page (Variation A) for future purposes is possible.

However, it is important to acknowledge that problem-solving does not always adhere to such a tidy framework, especially in the context of startups.

Given the rapid pace of technological advancements, it is crucial to remain adaptable and swiftly adjust your perspective when necessary.

The scientific method is the basis for all data-driven marketing and business experiments, whether consciously implemented or not.

Allow yourself time to be creative

According to a study conducted by MIT, entrepreneurs demonstrate distinct brain activity compared to other individuals.

The study conclusively demonstrated that entrepreneurs engage both the left and right hemispheres of their brains more frequently when making decisions.

Entrepreneurs effectively utilize their analytical problem-solving skills, associated with the left side of the brain, in conjunction with their imaginative and emotionally-driven thinking, linked to the right side.

To assess the cognitive patterns of entrepreneurial minds, MIT devised an experiment involving a slot machine game with a mix of entrepreneurs and corporate managers as participants.

The task required them to decide whether to persist with the same machine, a choice rooted in logical reasoning or to switch machines, a decision influenced by emotional factors.

Both groups displayed an equal tendency to either remain on the same machine or switch to a different one.

However, when entrepreneurs chose to change machines, the MRI scans revealed that both the left and right sides of their frontal cortex were active during decision-making.

Conversely, the group of corporate managers primarily exhibited activity on the left side alone.

Merely possessing creative abilities is insufficient; one must also provide ample time for creativity to thrive and develop.

In a 2016 study conducted by Harvard Business School, it was discovered that individuals with an entrepreneurial mindset tend to generate innovative solutions when granted free time.

The research paper cites the examples of Microsoft and Facebook, both of which were founded in January when students had no classes and were given time to prepare for final exams.

In a survey encompassing over 6,000 employees, only 44% reported that their companies rewarded and valued creativity.

Surprisingly, approximately 78% of the majority expressed that their companies embraced and valued fresh ideas.

Equally astonishing, around 85% revealed that their companies allocated free or “slack time” for them to explore innovative concepts.

The introduction of additional free time for innovation by many companies can be attributed to the influence of Google’s renowned “20% time.”

Under this policy, employees are free to devote 20% of their working hours to personal passion projects unrelated to their assigned tasks at Google.

The primary objective is to maintain a sense of inspiration and foster a continuous eagerness among employees to acquire new skills in areas that captivate them.

This initiative has proven immensely lucrative for Google.

Remarkably, numerous breakthroughs, including Gmail, AdSense, and Google Transit, originated from employees utilizing their allocated 20% time.

In the first quarter of 2013, AdSense alone accounted for approximately 25% of Google’s total revenue.

In fact, half of all Google products introduced in 2010 stemmed from projects developed 20% time.

As an entrepreneur, it is crucial to allocate time away from the daily operations of your new business and provide your brain with opportunities for creative thinking.

Have you ever experienced those moments of brilliance while taking a shower?

That’s your mind in a relaxed state, working its magic.

A study conducted by Scientific American devised a simple word association problem for participants to solve.

Surprisingly, they discovered that individuals who had a sudden burst of inspiration achieved an impressive success rate of 94%.

In contrast, those who meticulously approached the problem using logical reasoning from beginning to end only achieved a success rate of 78%.

To delve deeper into the phenomenon, scientists utilized EEG and MRI scans to investigate brain activity.

In individuals who experienced a sudden flash of insight, often known as a “shower thought,” researchers observed a temporary shutdown of the occipital cortex, which is responsible for visualization.

During the temporary shutdown of the occipital cortex, the brain was allowed to pause and engage in subconscious deliberation over the problem.

Isn’t it fascinating?

On the other hand, individuals who methodically processed the problem did so within their conscious minds.

Gaps in reasoning often accompany such analytical thinking as the brain strives to comprehend and make sense of the problem, ultimately resulting in lower success rates.

Be extroverted and take risks

Despite the existence of numerous successful introverted entrepreneurs, scientific research has uncovered a correlation between personality types and entrepreneurship.

A study revealed that individuals with specific Myers-Briggs personality traits are more likely to pursue entrepreneurial endeavors.

The Myers-Briggs personality test evaluates individuals based on four areas of measurement, resulting in 16 possible four-letter personality outcomes:

The World You Live In

This measures if you’re Extroverted (E) or Introverted (I).

Essentially, it examines whether you thrive on the energy and vibrancy of social interactions or find solace and fulfillment within the confines of your thoughts and introspection.

Response to Information

When processing information, do you prefer to assess it as presented, referred to as Sensing (S)? Or do you possess an inclination to perceive beyond the surface and recognize nuances, often referred to as Intuition (N)?

Decision Making

As the age-old saying suggests, there are individuals who prioritize following their heart rather than their mind.

In the context of the Myers-Briggs test, this aspect assesses whether you tend to make decisions based on logical reasoning, categorized as Thinking (T), or are more inclined to consider emotions and personal values, classified as Feeling (F).

Structure

When faced with new situations and information, do you tend to make quick and decisive judgments? This inclination is referred to as Judging (J) in the test.

Alternatively, do you lean towards maintaining an open and flexible mindset, known as Perceiving (P)?

The personality type ESTP, often labeled as “The Entrepreneur”, derives its name from the notable levels of perceptiveness exhibited by individuals with this type.

According to a study conducted by the Journal of Psychological Type, 46% of the surveyed entrepreneurs demonstrated a high level of perceptiveness (P).

These perceptive entrepreneurs were characterized by their creativity, adaptability, and proactive approach in driving change within their respective companies.

Additionally, another study revealed that individuals with Extroverted (E) and Thinking (T) personality types were more inclined to pursue entrepreneurship for similar reasons, including their comfort with taking risks.

Taking risks is a fundamental aspect of achieving entrepreneurial success.

As an entrepreneur, it is crucial to assess situations swiftly and take decisive actions.

While setbacks and failures may arise on the path to success, it is through taking calculated risks that the potential for rewarding outcomes emerges.

Conclusion

Becoming a successful entrepreneur demands immense determination and vitality.

It also necessitates developing the ability to confront failures, perceiving them as valuable learning experiences, and swiftly moving forward to conquer the next challenge.

This quality is known as resilience.

Being open to novel ideas, even if they challenge deeply held beliefs, is a vital trait.

Above all, maintaining an optimistic outlook and unwavering self-belief are paramount.

However, it is crucial to strike a balance, ensuring that optimism doesn’t blind one to the signs of impending failure and the need for course correction.

Scientific research has confirmed that entrepreneurs possess a distinct mindset compared to employees, but ultimately, it boils down to the concept of grit.

Grit represents the unwavering perseverance to pursue long-term goals, even without guaranteed success. It encompasses one’s internal motivation and drives to effect change in the world.

We consider grit to be the most crucial attribute for entrepreneurs.

To possess grit, one must exhibit resilience, optimism, problem-solving abilities, and creative self-marketing skills.

With an unwavering focus on success and a determined mindset, there are no limits to what one can achieve.