Are Entrepreneurs Born or Made
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The term entrepreneur is not a recent invention. It was first coined in the eighteenth century by Richard Cantillon, who identified the risk-bearing function of an entrepreneur (Jennings et al. 1994). According to Morrison (1999 p30), entrepreneurs can be regarded as “first among equals in the process of wealth creation”. Moreover, entrepreneurs are presented as economic heroes (Cannon 1991), who “combining the ability to innovate and challenge the established equilibrium of economy and society whilst in the process of recreating it” (Morrison 1999 p28).
There are two schools of thought about what makes an entrepreneur. The first is that anyone can do it if they really want to, provided they put in the effort. The second is that entrepreneurs are born and not made, which means you have to be a certain type of person, and if you are not that type, you are wasting your time. The aim of this essay is to critically analyze the both schools of thought and provide justification for arguments. The born or made debate It is a longstanding debate: are entrepreneurs made or born?
Morrison (1999) states that the early studies of the origins of the entrepreneur, which concentrated almost entirely on emphasizing in-born personalities and motivations, assumed that the entrepreneurial flair was inherent in the individual. Such a trait model of behaviour argues that a trait being a persisting characteristic of the personality which differentiates him or her from others. Woods, referenced by Bolton (2000 p15), suggests that “75 per cent of our personality traits are due to genetic influence and 25 per cent due to environmental influence”.
We have seen too many failed entrepreneurs, who have lost the family home and whose marriage has failed, to believe that educators can make people into entrepreneurs. We are particularly concerned that those who score twenty-five out of hundred should be advised ‘You still have a chance. Go for it’. Furthermore, research at the University of Minnesota on identical twins separated at birth and reared in different environments shows that character traits are shaped by genetics (Bolton 2000).
According to a survey by Northeaster University’s School of Technological Entrepreneurship, 62% of entrepreneurs say they were inspired to start their own companies by their innate drive. Work experience and the success of their peers were cited by only 21% and 16%, respectively, as factors. The DNA of true entrepreneurs propels them to get on the roller coaster ride that comes with launching a venture. They defiantly disregard red flags of caution, the words of naysayers, or any statistics that conclude their business may fail (Black Enterprise 2007).
On the other hand, Chell et al. referenced by Morrison (1999), state that many of the identified entrepreneurial characteristics are the same abilities and skills that could be applied to most successful people, such as Olympic athletes, Premier Division football players, or leading politicians. It just so happens that the individual has chosen the arena of business as a means of self-satisfaction. Thus, it is extremely difficult to explain why the individual chooses to apply a number of the identified traits within an entrepreneurial business context, rather than in some other sphere of life.
This approach does not ignore the genetic influence on personality traits, but advances discussion through linking them to the social context of the individual. Furthermore, it has been suggested that entrepreneurs often shared common features and experiences of social context, which distinguish them from other individuals (Carter and Cachon 1988). Examples of this are relative to, for instance, ethnic minority groups, family businesses, and female self-employed. These are defined as antecedent influences and this thinking contributes to a model of social development of the entrepreneur (Morrison 1999).
Several books on entrepreneurship state that entrepreneurs are ‘made’. Kuratko and Hodegetts (1998) put forward the argument that entrepreneurship is a discipline that can be taught and mastered like any others. Whatever the exact ratios are it is clear that personality is now understood as having an inborn component and an environment component. In so far as the entrepreneur is a function of personality we would conclude that entrepreneurs are both born and made. Burns (2001) bring together the various factors which have been identified as contributory to entrepreneurial behaviour.
He classifies them into four distinct groups, which are now described and illustrated in Figure 1. Figure 1 Influences on owner-managers and entrepreneurs This model proposes that entrepreneurs are, in fact, both born and made. Whilst they do have certain personal character traits that they may be born with, they are also shaped by their history and experience of life. This comprises their antecedent influences and the culture of the society they are brought up in. Some cultures encourage entrepreneurial activity. Others discourage it. What is more, the situations entrepreneurs find themselves in can influence the decision.
According to Bolton (2000), situation triggers are ‘dynamic’ environmental factors, which provide the spark that lights the flame. This can be an introduction to something or somebody, a change of circumstances such as redundancy and so on. All these factors influence the decision, whether to start up a business and whether to grow it. Indeed both antecedent influences and the dominant culture of the society will most likely influence the personal character traits of individuals. Clearly, these three factors are interrelated (Burns 2001).