Qualities of an Entrepreneur
The entrepreneurial culture comes from the general environment of the regional or national cultural characteristics and the individual attributes of the people involved. According to the Journal of Economic Psychology (2012 cited in Röhl, 2016), there are different level of personal traits that conduct to an entrepreneurship personality.
Desire for Autonomy
For an entrepreneur is more important to pursue self-employment than running some other successful business. Sometimes people with limited alternative to get a job tend also to found a company. Nevertheless, even entrepreneurs who are well-qualified tend to accept being self-employed with the great income insecurity that it has, as well as the higher workload that it requires. Also, it is preferred to have a lower income than being in a conventional employment relationship. This can be explained due to the value that is given to autonomy, which turns higher than the monetary reward. Entrepreneurs try to avoid to get involved into complex hierarchies in organizations and would prefer independence. The decision of turning into a self-employed is divided by the appreciation of the freedom or independence that the entrepreneur will get and also the relief of leaving an uncomfortable organizational structure with supervisors. Plus, the set of personal work goals can increase the entrepreneur’s wellbeing and their desire to turn into a self-employed.
Desire for Profit
The will of generating profit is an important factor to turn into a entrepreneur. In high-growth and innovative industries, one main goal of the entrepreneurs is even to sell their companies, because of their fast achievements as start-ups and get the returns out of the deal
Entrepreneurial Process Stages
There are divided opinions about if entrepreneurs are very tolerant of risk or less risk-averse than employees. What it is mentioned is that successful entrepreneurs are actually highly aware of upcoming risks, so they are well prepared when they came. It is not only about the tolerance to risk, but with the desire of a greater autonomy, entrepreneurs are willing to accept uncertainty in order to found accompany. The risk aversion would be different between people who are desiring to start a company to the ones who just preferred to be self-employed. The mix between the desire of autonomy and profit, plus the professional skills that the entrepreneur might have, could take the individual to see the risks that might come as less important, and that those challenges could be managed. Therefore, entrepreneurs know their own ability of how they can successfully control the risks associated with building a business.
Individuals who belong and are integrated to different social networks and have social connections could also be determined their probability of starting a successful business. As social capital, it is also included the family background and their status. The parents who are in a self-employment position have a positive influence on the entrepreneurs, and it can also explain the role model that they are playing over the individuals. Nevertheless, the social capital goes also on the person’s ability to take advantage of those networks, contacts and role models.
What is Entrepreneurship?
What influences on Entrepreneurs?
The combination of the personal attitudes and characteristics, the social norms, and the personal abilities would have the influence on individuals to prefer to become self-employed. On figure 15, it is illustrated this relation and how the preference for self-employment could lead to a business idea and therefore to take the decision to start a company (Röhl, 2016).
The preference of an individual is affected by its attitudes, the perception of social standards and the self-assessment, and therefore this could lead into the development of a new company to be self-employed. The three factors can have an indirect on indirect influence on the person depending on the situation and environment where the individual it is situated. A positive self-assessment in a start-up environment could encourage directly the individual to start his own business, but in other hand if he is encountered in a society where traditional employment is dominating, then this self-assessment could have an indirect influence towards turning into a self-employed (Röhl, 2016).
Caliendo, Fossen and Kritikos (2012 as cited in Röhl, 2016) define that trust is a key personality trait of entrepreneurs. In the regions where innovation and entrepreneurship are strong, the networks are a key player that is highly dependent on the trust that exists between the stakeholders. The trust-based relationships that are created between the actors of this networks are shaped by how positive or negative reciprocity exists. For example, a negative reciprocity behavior inside the network could have an inhibitory effect on creating a successful venture. People who are constantly searching for a favor payback could lose trust quickly because of the abuse of their relationship in order to get their own business objectives, but at last they only damage themselves. As consequence, a betrayed trust generates a limitation on the business relationship and even decreases the chances of getting new partners. Another key personality trait of entrepreneurs is optimism. This characteristic gives the boost to entrepreneurs to put a lot of work at the beginning and even initiate with a low income, because they expect that their idea eventually has the potential to grow.