Are Entrepreneurs Born -- or Made? Research Says 'Born.' But There's a Catch.

Jayson DeMers
GUEST WRITER
Founder and CEO, AudienceBloom
Entrepreneurs, social psychologists and economic theorists have all speculated whether
entrepreneurs are born or made -- in other words, whether you're predisposed to
become an entrepreneur due to your genetic makeup, or whether that disposition
comes from your environment, conditioning or other external influences.

For most entrepreneurial hopefuls, it’s comforting to think that entrepreneurs are made,
that even if you lack the "right" DNA, enough practice, experience and conditioning can
help you be a success.

But step away from that comfort zone, because research seems to indicate the
opposite: Entrepreneurship rates, it turns out, especially rates of entrepreneurship
success, are influenced more by a person’s genes than his or her upbringing and
degree of nurturing. Fortunately for the majority of entrepreneurial hopefuls, however,
there’s a catch.

What the research says

There have been many studies attempting to answer this question, and they've
landed on each side of the argument. In the nature vs. nurture debate (looking at factors
beyond entrepreneurship), the most effective studies have been those done on twins,
because they naturally share DNA, but may have experienced different environments
and upbringings. An important distinction here is that identical twins share 100 percent
of the same genetic information, while fraternal twins share 50 percent.

One study that looked at entrepreneurial tendencies, specifically, was done by Scott

Shane, a professor at Case Western Reserve University. Shane looked at hundreds of
pairs of twins, eventually finding that the identical twins among them had much higher
rates of “shared entrepreneurial tendencies” than their fraternal counterparts or subjects
in the control group.

Further exploration of data, including the research of molecular genetics, has traced

this genetic heritability to four core entrepreneurial traits, each of which increases the
likelihood of becoming an entrepreneur, while also being heritable:

1. The likelihood of starting a business. Genes can influence your probability of

starting a business.

2. The ability to identify new opportunities. Your ability to identify business

opportunities is similarly heritable.
3. The tendency to become self-employed. Related to but distinct from starting a
business, self-employment is also a heritable probability.

4. Extroversion. Though extroversion by itself isn’t enough to motivate

entrepreneurship, extroverts have an easier time making new connections, leading
followers and engaging in a wider community.

A less formal survey of entrepreneurial beliefs found that just 1 percent of entrepreneurs

surveyed believed that higher education played any role in shaping their entrepreneurial
mindset. Conversely, 61 perddcent said their entrepreneurial characteristics had arisen
from their innate drive.

The catch

What’s the catch here? All of these studies and surveys looked at entrepreneurs as a
group; it paid no attention to how successful those entrepreneurs actually were. So, the
takeaway here is that your genes play a role in your likelihood of actually starting a
business, rather than whether that business will actually be successful.

In other words, just because you have a lower genetic likelihood of starting a
business doesn’t mean you can’t start a business, or that the business won’t be
successful. In fact, with significant drive and practice, you might be even more likely to
succeed than someone genetically predisposed to starting a business -- especially if
that person hasn't had as much real-world experience as you.

The role experience plays

Another study, from Stanford Graduate School of Business professor Kathryn

Shaw looked at data from 2.8 million small businesses to determine rates of success
based on previous experience. As you might expect, success rates were dramatically
higher for entrepreneurs who had previous experience running a business.

This may seem like an obvious observation, but it’s important to consider in the
discussion on whether entrepreneurs are born or made; it turns out that, regardless of
your tendency to start a business, the real determining factor for success is in how
much experience you get in an entrepreneurial role.

The two distinct questions we can ask

The first is: Are entrepreneurs born or made? This question looks only at a person’s
probability of starting a business; and. according to research, entrepreneurs are more
often born.

The second is: Are successful entrepreneurs born or made? This question ignores the

probability of starting a business, instead favoring the probability of success within a
leadership position of a business. According to research, successful entrepreneurs are
more often made.

What does all of this mean for you, the aspiring entrepreneur? If you want to dig
deeper, you can look to your family members to get a loose, subjective gauge of your
relative chances of starting a business; if entrepreneurship runs in your family, you’re
probably more likely to start a business. If you have a burning desire to be self-
employed, entrepreneurship may be innate.

More importantly, though, regardless of your heritage, your chances of making a

business successful aren’t set in stone. Even the least genetically likely entrepreneurs
can become successful if they spend enough time improving their skills, gaining
experience as entrepreneurs and committing themselves to better ideas and self-
improvement.

Related:  Don’t let research persuade you that you don’t have what it takes -- anyone
can become a successful business owner if he or she really commits to it.