Description
In such a detailed data in regard to nature or nurture decoding the dna of the entrepreneur executive summary.
Nature
or nurture?
Decoding the DNA
of the entrepreneur
Executive summary
1 Nature or nurture? Decoding the DNA of the entrepreneur
Executive summary
Entrepreneurial leaders enjoy a
reputation as freewheeling mavericks
who operate in a world far removed from
corporate life. Yet the overlap between
entrepreneurial leaders and traditional
managers is much larger than is often
assumed. Creative, innovative individuals
may possess copious ideas, but it takes
leadership and business discipline to turn
them into successful ventures.
With entrepreneurship seen as a major
source of economic growth and job
creation, the question remains: what
makes up an entrepreneurial mindset?
This question is echoed in major
corporate boardrooms, with many chief
executives keen to encourage internal
entrepreneurial thinking and innovation
as a way to reinvent their businesses and
stay ahead of the competition.
This report aims to provide some insights
into the minds of today’s most successful
entrepreneurial leaders and discern what
makes them successful. We conclude with
a model that represents both the intrinsic
and extrinsic characteristics of their
mindset and abilities.
The report features perspectives from
a survey of 685 entrepreneurial business
leaders from around the world and is
informed by a series of in-depth interviews
with Ernst & Young Entrepreneur
Of The Year
®
Award winners.
Key fndings of the report
1. Entrepreneurial leaders are made, not born.
The concept of the young, dynamic entrepreneurial leader who starts a venture fresh
out of college is one that persists. But although many entrepreneurial leaders start at
a reasonably young age, the experience they gain through education and time spent in
a more traditional corporate environment is vital to their future success. Indeed, more
than half of respondents describe themselves as “transitioned” entrepreneurs — in other
words, they have previously spent time in traditional employment before setting out
on their own.
2. Entrepreneurship is rarely a one-off decision.
The majority of survey respondents are “serial entrepreneurs” who have launched at
least two companies. Entrepreneurial leaders who embark on more than one venture
gain valuable insight and lessons into how to make a new business successful. As such,
they perform a vital role in the economy and, among them, start a signifcant proportion
of all new ventures.
3. Funding, people and know-how are the biggest barriers to entrepreneurial success.
Among the 6 out of 10 respondents who experienced obstacles in their ventures,
the most common barrier is lack of funding or fnance. This is particularly pertinent
in the current environment, when many entrepreneurs continue to experience
problems with accessing fnance, despite a gradual easing of credit conditions in many
countries. The two other most-cited obstacles are people and expertise. As a result,
entrepreneurial leaders are well-advised to build “ecosystems” — networks of resources —
to address these three areas.
4. Entrepreneurs share common traits.
Entrepreneurs may be made rather than born, but our research has found that
entrepreneurs typically will exhibit a combination of behaviors and attitudes. At the
heart of this model is a strong internal locus of control — a belief that events result
directly from an individual’s own actions or behavior. This is complemented by a
mindset that sees opportunity where others see disruption, along with an acceptance
of calculated risk and a tolerance of failure.
5. Traditional companies can learn from entrepreneurial leaders.
Employee incentives and fostering innovation are good places to start. It is no
coincidence that fast-growing entrepreneurial companies tend to place larger
amounts of share ownership in the hands of employees. And in terms of innovation,
traditional companies have few incentives to disrupt their own business models with
game-changing innovations. But companies that can are richly rewarded.
2 Nature or nurture? Executive summary
Based on our research into the mindset
of today’s entrepreneurial leaders,
Ernst & Young has developed a model of
what comprises an entrepreneurial leader:
• At the nucleus of the model are the
yin and yang characteristics of an
opportunistic mindset combined with
a unique attitude to risk and failure.
• The nucleus is combined with the
idea of “locus of control” — a belief in
control over one’s environment. This
is complemented by the ability to see
opportunities and a willingness to take
risks to seize them.
• Surrounding the core of the model
are six guides to action that
entrepreneurial leaders live every day:
passion, persistence, the ability to
work with a team yet follow their own
instincts, the creation of a “success
culture,” an eye for niches and market
gaps, and a focus on building a fnancial
ecosystem to support the venture.
• Finally, the outer ring of the model
draws on previous research of the
attributes identifed as those held by
leaders of exceptional enterprises —
uncovered as part of Ernst & Young’s
Exceptional Enterprise model.
1
The core of the entrepreneur is ultimately
about a way of viewing the world
and the ability to act on those views.
Entrepreneurial leaders are personally
characterized by a strong locus of control,
an opportunistic outlook and a willingness
to take risks (and potentially fail). These
traits are at the core of the model. The
model should be viewed as “and, and”
not “either, or” as it is the combination
of all four layers that sets entrepreneurial
leaders apart from their peers.
Profle of 685 entrepreneurial leaders surveyed:
• More than 30 countries and 25 sectors represented
• Majority of companies have revenues ranging from US$10m to over US$20b
• 58% of the respondees achieved strong revenue growth of more than 20%
in the last year
The DNA of the entrepreneur model
1 Why are some companies luckier than others, Ernst & Young, 2008
Assurance | Tax | Transactions | Advisory
Ernst & Young
About Ernst & Young
Ernst & Young is a global leader in assurance,
tax, transaction and advisory services.
Worldwide, our 141,000 people are united
by our shared values and an unwavering
commitment to quality. We make a difference
by helping our people, our clients and our wider
communities achieve their potential.
Ernst & Young refers to the global organization
of member firms of Ernst & Young Global
Limited, each of which is a separate legal entity.
Ernst & Young Global Limited, a UK company
limited by guarantee, does not provide services
to clients. For more information about our
organization, please visit www.ey.com
About Ernst & Young’s Strategic
Growth Markets Network
Ernst & Young’s worldwide Strategic Growth
Markets Network is dedicated to serving the
changing needs of rapid-growth companies. For
more than 30 years, we’ve helped many of the
world’s most dynamic and ambitious companies
grow into market leaders. Whether working with
international mid-cap companies or early stage
venture-backed businesses, our professionals
draw upon their extensive experience, insight
and global resources to help your business
achieve its potential. It’s how Ernst & Young
makes a difference.
© 2011 EYGM Limited.
All Rights Reserved.
EYG no. CY0170
This publication contains information in summary form and is
therefore intended for general guidance only. It is not intended
to be a substitute for detailed research or the exercise of
professional judgment. Neither EYGM Limited nor any other
member of the global Ernst & Young organization can accept
any responsibility for loss occasioned to any person acting
or refraining from action as a result of any material in this
publication. On any specific matter, reference should be made
to the appropriate advisor.
doc_177571652.pdf
In such a detailed data in regard to nature or nurture decoding the dna of the entrepreneur executive summary.
Nature
or nurture?
Decoding the DNA
of the entrepreneur
Executive summary
1 Nature or nurture? Decoding the DNA of the entrepreneur
Executive summary
Entrepreneurial leaders enjoy a
reputation as freewheeling mavericks
who operate in a world far removed from
corporate life. Yet the overlap between
entrepreneurial leaders and traditional
managers is much larger than is often
assumed. Creative, innovative individuals
may possess copious ideas, but it takes
leadership and business discipline to turn
them into successful ventures.
With entrepreneurship seen as a major
source of economic growth and job
creation, the question remains: what
makes up an entrepreneurial mindset?
This question is echoed in major
corporate boardrooms, with many chief
executives keen to encourage internal
entrepreneurial thinking and innovation
as a way to reinvent their businesses and
stay ahead of the competition.
This report aims to provide some insights
into the minds of today’s most successful
entrepreneurial leaders and discern what
makes them successful. We conclude with
a model that represents both the intrinsic
and extrinsic characteristics of their
mindset and abilities.
The report features perspectives from
a survey of 685 entrepreneurial business
leaders from around the world and is
informed by a series of in-depth interviews
with Ernst & Young Entrepreneur
Of The Year
®
Award winners.
Key fndings of the report
1. Entrepreneurial leaders are made, not born.
The concept of the young, dynamic entrepreneurial leader who starts a venture fresh
out of college is one that persists. But although many entrepreneurial leaders start at
a reasonably young age, the experience they gain through education and time spent in
a more traditional corporate environment is vital to their future success. Indeed, more
than half of respondents describe themselves as “transitioned” entrepreneurs — in other
words, they have previously spent time in traditional employment before setting out
on their own.
2. Entrepreneurship is rarely a one-off decision.
The majority of survey respondents are “serial entrepreneurs” who have launched at
least two companies. Entrepreneurial leaders who embark on more than one venture
gain valuable insight and lessons into how to make a new business successful. As such,
they perform a vital role in the economy and, among them, start a signifcant proportion
of all new ventures.
3. Funding, people and know-how are the biggest barriers to entrepreneurial success.
Among the 6 out of 10 respondents who experienced obstacles in their ventures,
the most common barrier is lack of funding or fnance. This is particularly pertinent
in the current environment, when many entrepreneurs continue to experience
problems with accessing fnance, despite a gradual easing of credit conditions in many
countries. The two other most-cited obstacles are people and expertise. As a result,
entrepreneurial leaders are well-advised to build “ecosystems” — networks of resources —
to address these three areas.
4. Entrepreneurs share common traits.
Entrepreneurs may be made rather than born, but our research has found that
entrepreneurs typically will exhibit a combination of behaviors and attitudes. At the
heart of this model is a strong internal locus of control — a belief that events result
directly from an individual’s own actions or behavior. This is complemented by a
mindset that sees opportunity where others see disruption, along with an acceptance
of calculated risk and a tolerance of failure.
5. Traditional companies can learn from entrepreneurial leaders.
Employee incentives and fostering innovation are good places to start. It is no
coincidence that fast-growing entrepreneurial companies tend to place larger
amounts of share ownership in the hands of employees. And in terms of innovation,
traditional companies have few incentives to disrupt their own business models with
game-changing innovations. But companies that can are richly rewarded.
2 Nature or nurture? Executive summary
Based on our research into the mindset
of today’s entrepreneurial leaders,
Ernst & Young has developed a model of
what comprises an entrepreneurial leader:
• At the nucleus of the model are the
yin and yang characteristics of an
opportunistic mindset combined with
a unique attitude to risk and failure.
• The nucleus is combined with the
idea of “locus of control” — a belief in
control over one’s environment. This
is complemented by the ability to see
opportunities and a willingness to take
risks to seize them.
• Surrounding the core of the model
are six guides to action that
entrepreneurial leaders live every day:
passion, persistence, the ability to
work with a team yet follow their own
instincts, the creation of a “success
culture,” an eye for niches and market
gaps, and a focus on building a fnancial
ecosystem to support the venture.
• Finally, the outer ring of the model
draws on previous research of the
attributes identifed as those held by
leaders of exceptional enterprises —
uncovered as part of Ernst & Young’s
Exceptional Enterprise model.
1
The core of the entrepreneur is ultimately
about a way of viewing the world
and the ability to act on those views.
Entrepreneurial leaders are personally
characterized by a strong locus of control,
an opportunistic outlook and a willingness
to take risks (and potentially fail). These
traits are at the core of the model. The
model should be viewed as “and, and”
not “either, or” as it is the combination
of all four layers that sets entrepreneurial
leaders apart from their peers.
Profle of 685 entrepreneurial leaders surveyed:
• More than 30 countries and 25 sectors represented
• Majority of companies have revenues ranging from US$10m to over US$20b
• 58% of the respondees achieved strong revenue growth of more than 20%
in the last year
The DNA of the entrepreneur model
1 Why are some companies luckier than others, Ernst & Young, 2008
Assurance | Tax | Transactions | Advisory
Ernst & Young
About Ernst & Young
Ernst & Young is a global leader in assurance,
tax, transaction and advisory services.
Worldwide, our 141,000 people are united
by our shared values and an unwavering
commitment to quality. We make a difference
by helping our people, our clients and our wider
communities achieve their potential.
Ernst & Young refers to the global organization
of member firms of Ernst & Young Global
Limited, each of which is a separate legal entity.
Ernst & Young Global Limited, a UK company
limited by guarantee, does not provide services
to clients. For more information about our
organization, please visit www.ey.com
About Ernst & Young’s Strategic
Growth Markets Network
Ernst & Young’s worldwide Strategic Growth
Markets Network is dedicated to serving the
changing needs of rapid-growth companies. For
more than 30 years, we’ve helped many of the
world’s most dynamic and ambitious companies
grow into market leaders. Whether working with
international mid-cap companies or early stage
venture-backed businesses, our professionals
draw upon their extensive experience, insight
and global resources to help your business
achieve its potential. It’s how Ernst & Young
makes a difference.
© 2011 EYGM Limited.
All Rights Reserved.
EYG no. CY0170
This publication contains information in summary form and is
therefore intended for general guidance only. It is not intended
to be a substitute for detailed research or the exercise of
professional judgment. Neither EYGM Limited nor any other
member of the global Ernst & Young organization can accept
any responsibility for loss occasioned to any person acting
or refraining from action as a result of any material in this
publication. On any specific matter, reference should be made
to the appropriate advisor.
doc_177571652.pdf