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According to Frederick and Kuratko (2010: 39-40), “Entrepreneurs (normally defined as risk takers in new

venture creations) are optimistic, hard-driving, committed individuals who derive great satisfaction from being

independent. Starting a new business requires more than just an idea: it requires a special person who uses

sound judgement and planning along with managed risk taking to ensure the success of their own business”.

Discuss and evaluate the most commonly cited characteristics found in successful entrepreneurs.

Personality traits and characteristics of entrepreneurship

Introduction

At present, continuous economic change, advanced technology and increased competition

provide numerous opportunities for new ventures to develop in the business environment

(Samson & Daft, 2012). The latter comprises entrepreneurship, which is defined as the

process of commencing a novel enterprise through a vision of change and creation; it requires

proper management of resources, as well as identifying and creating new ends and means

unutilised by consumers (Frederick & Kuratko, 2010; Brandstatter, 2011). Hence, a

successful entrepreneur recognises a viable idea and opportunity for a good or service and

carries it out (Samson & Daft, 2012). Although literature emphasizes that an innovative

thought is critical for entrepreneurial success, the mere establishment of an endeavour does

not reflect the complete picture (Frederick & Kuratko, 2010). Previous studies indicate that

entrepreneurs have specific personality traits and characteristics, which are different to those

that traditional managers have (Frederick & Kuratko, 2010; Deamer & Earle, 2004; Bedi,

1997). They seem to be risk-takers, optimistic, and hard-driving; in other words, individuals

who want to maximise their potential beyond expectations (Elenurm & Alas, 2009). This is

corroborated by research showing successful entrepreneurs such as Steve Jobs (Apple), Mark
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Zuckerberg (Facebook), Sergey Brin and Larry Page (Google) and Bill Gates (Microsoft)

who share a particular quality: they are creative thinkers (Focus, 2009). Alternatively,

entrepreneurship occasionally depicts a negative side that includes several risks and stress

(Frederick & Kuratko, 2010). This is due to the pressure exerted in order to attain success.

This paper will critically evaluate the most common cited personality traits and

characteristics found in successful entrepreneurs and discuss reasons for their importance

based on empirical evidence.

Main body

Innovativeness (creativity) and risk-taking

In accordance with the model introduced by Robinson, Stimpson, Huefner and Hunt (1991),

innovativeness (and creativity) is listed as a primary entrepreneurial characteristic. Prior

research further claims that there is a positive relationship (.24) between this variable and

business success (Brandstatter, 2011). Accordingly, innovativeness is defined as the

flexibility and capacity of making atypical associations (Frederick & Kuratko, 2010). As

stated by Chye (1996), Edwin Land (co-founder of Polaroid who made instant photography

possible) demonstrated the outlined concept, by relating sheets of polarizing plastic with

crystals to suppress the night time glare. This resulted in the creation of the polarizing film.

Furthermore, entrepreneurs that manage to pursue creative opportunities are considered as

having a long-term vision (Elenurm & Alas, 2009). Empirical evidence by Deamer and Earle

(2004) showed that the traditional ‘Chinese Entrepreneur prototype’ is considered to have the

ability to create and innovate, in addition to a well-defined vision.

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Despite innovativeness (and creativity) has proven an essential trait required by successful

entrepreneurs, it carries a risk. The entrepreneur could be required to invest a substantial

amount of money to commence a venture. If this individual utilises their own capital like

savings, real estate, or salary, there is a probability of failure, ergo, financial risk ( Frederick

& Kuratko, 2010). In other words, they are exposed to personal bankruptcy. This is the case

of John Bello who proposed a ‘geo-based’ iced tea to compete with Nantucket Nectars and

Arizona; ultimately he lost around two million dollars (Entrepreneurship, 2010). At the end,

entrepreneurs must be innovative and creative; nevertheless they need prudence and a

realistic framework to work with when it comes to investments.

As mentioned above, risk can be dangerous for businessmen. In this sense, another cited

characteristic found in successful entrepreneurs’ is that they possess a degree of calculated

risk-taking (Frederick & Kuratko, 2010; Luca, Cazan, & Tomulescu, 2012). This does not

mean they are risk-averse; on the contrary, if they decide to engage in a new business under

uncertainty, they will decide to take the opportunity after meticulous calculations and

evaluations, as a way to avoid unnecessary threats (Chye, 1996; Frederick & Kuratko, 2010).

Correspondingly, findings by Samson and Daft (2009) support this idea; risk propensity is

significantly higher in entrepreneurs than on non-entrepreneurs. For instance, Richard

Branson (founder of Virgin Airlines) is considered as one of the biggest risk-takers of all

times; after creating, expanding and succeeding with Virgin Records in 1977, he decided to

embark in the airline industry unexpectedly (Entrepreneur, 2008). At the moment he is the 4 th

richest citizen in the United Kingdom according to Forbes (2011a). Likewise, having risk-

taking abilities is critical to Chinese organisations during selection and recruitment processes

(Rozell, Meyer, Scroggins, & Guo, 2011). Although risk-taking seems positive, past research

indicates a negative association between this factor and business success due to over-
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optimism (Rauch & Frese, 2000). As a manager becomes an entrepreneur, the focus centres

on the developing enterprise and the person will most likely jeopardize any previous jobs.

This means career risk will be present; assuming failure, the individual is not guaranteed with

a secure organisational job with a high salary (Frederick & Kuratko, 2010). Therefore, any

fantasy approach (over-optimism) that could interfere (ignoring trends, facts and reports) in

the assessment of opportunities (risk-taking) in the business environment must be controlled

(Frederick & Kuratko, 2010). Innovativeness and risk-taking must be used properly in order

to achieve success in the venture.

Commitment, determination, perseverance and high-energy level

Aside from innovativeness and risk-taking, those entrepreneurs who are successful tend to be

totally committed (total dedication based on self-motivation) to their cause (Mitton, 1989;

Frederick & Kuratko, 2010). They have a determination (eagerness to succeed against the

odds) that entails willingness to learn, the capability to start from nothing, persistence to

defeat obstacles, readiness to sacrifice their family, and live in reduced standards (Rozell et

al., 2011; Frederick & Kuratko, 2010). By the same token, Elenurm and Alas’ (2009)

investigation claims that one of the features about successful entrepreneurs in Estonia is

determination. What is more, a study by Abdul, Wan and Zakaria (2010) indicates a positive

association between commitment and successful performance of small businesses. Currently,

Warren Buffet is eighty years old and still, has a long-standing commitment with his

company Berkshire Hathaway (Focus, 2009). As it can be seen entrepreneurs are not

committed for the time being but for years; they keep on persevering.
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In addition to commitment, determination and perseverance, successful businessmen require

a high energy level to cope with venture start-ups and substantial workloads along the way

(Samson & Daft, 2012; Thomas & Mueller, 2000; Chye, 1996). A survey of entrepreneurs

depicted that half the people worked at least 60 hours per week (Samson & Daft, 2012).

Another review by the National Federation of Independent Business in the United States

(1989) showed that most business owners who had recently acquired the endeavour worked

between 60 to 69 hours per week. Consequently, most entrepreneurs adjust their energy

levels by adopting a healthy lifestyle, exercising and knowing when to meditate and relax

(Frederick & Kuratko, 2010; Weede, 2006). For instance, Max Hoes (co-owner of CFR Line;

international transportation company) exercises every day, while Brian Scudamore (CEO of a

junk removal company) asserts that working out and eating well are beneficial to his day-to-

day routine (Weede, 2006).

Although both commitment and high-energy levels appear to be manageable for the

individual, there are a couple of risks associated to them: family and psychic risk (Frederick

& Kuratko, 2010). Starting an enterprise consumes a lot of energy and time. The entrepreneur

can be married and have children. Therefore all relatives could be exposed to an incomplete

family experience as the entrepreneur is not present, leading to possible emotional damage

(Frederick & Kuratko, 2010). Similarly, communication problems with the partner, as well as

drifting apart will occur; according to Ponzetti, Zvonkovi, Cate and Hudson (1992), both

issues are the main affective reasons (48 per cent) leading to divorce; in other words,

increased family risk. Ted Turner (founder of CNN), for example, has been married and

divorced three times (Forbes, 2010). During his last marriage, his attention turned to social

causes leaving his spouse unattended, while his fortune grew by $1 billion (Forbes, 2010). At

the same time, there are psychological risks (Frederick & Kuratko, 2010). There are some
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entrepreneurs who cannot recuperate from financial bankruptcy as it is too severe. In this

sense, adequate management for the outlined risks rely very much on the entrepreneur as

success on the enterprise will depend on the degree of commitment, determination,

perseverance and high-energy level applied.

Drive to achieve and internal locus of control

In line with the mentioned personality traits and characteristics found in successful

entrepreneurs, the need for achievement should be included. This is consistent with numerous

approaches, such as Robinson’s et al. (1991), McClelland’s (1961), Stewart’s and Roth’s

(2007), which list the drive to achieve as a strong psychological motivational force related to

a desire to be successful, thereby associated with entrepreneurship. Likewise, Johnson’s

(1990) report shows that this trait is included as a primary one in twenty out of twenty three

major studies. Furthermore, this factor is closely related with a general sensation of

confidence that lets individuals deal with the constant change in the business environment

(Samson & Daft, 2012). Due to this self-confidence, entrepreneurs feel optimistic most of the

time. If these are acquired, it is said that new venture creation followed by success will occur.

As Bill Gates formed Microsoft, he envisioned ‘a computer on every desk and Microsoft

Software on every computer’ (Buzzle, 2011). At the moment, Windows has almost ninety per

cent of the market share, while Gates is the second-richest person in the world (StatsCounter

Global Status, 2012; Forbes, 2011b). Growth has occurred based on an interrelation of

characteristics working together, especially vision, the need to achieve and overall self-

confidence.
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Parallel to the drive to achieve, entrepreneurs believe that they are in control of their own

life’s events, which means that all accomplishments are controlled by themselves; in other

words, they are able to attain all their desired outcomes directly, rather than feeling subject to

chance, luck or fate (Frederick & Kuratko, 2010; Deamer & Earle, 2004; Chye, 1996;

Brockhaus & Horwitz, 1986). This kind of personality, considered a vital trait for

businessmen, is defined as possessing an internal locus of control. Brockhaus and Horwitz

(1986) confirmed that having the internal locus of control is an entrepreneurial characteristic.

It distinguishes successful from unsuccessful entrepreneurs, since the former, have the drive

and strength to act on the urge on control and take personal responsibility (self-motivation) to

manage their actual situation independently (Ernst & Young, 2011). In stark contrast, an

external locus of control is the belief that entrepreneurs’ future is not within their control, but

the environment. In like manner, findings by Ho and Koh (1992) confirm the need to achieve

as an entrepreneurial trait always cited in literature as common characteristics for

businessmen. Larry Elisson, founder and CEO of Oracle has a strong internal locus of

control. This entrepreneur is not only a great risk-taker, but rarely listens to his advisers, even

if they think a decision is unwise (Lussier, 2009). Decisions made by Elisson are usually

‘right’, alongside with a high level of optimism (Lussier, 2009). This entrepreneur’s believes

that it is not enough to win; all other players must lose (Lussier, 2009).

Notwithstanding the fact that the described traits are commonly cited characteristics found in

businessmen, there are two negative sides: entrepreneurial stress and entrepreneurial ego. The

former refers to a harmful psychological and physical (indigestion, insomnia or headaches)

state derived from the discrepancy between the inability to meet demands and expectations

(Frederick & Kuratko, 2010). Furthermore, the latter is defined as the consequences of

exhibiting all the characteristics to their extreme (Frederick & Kuratko, 2010). Perhaps an
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entrepreneur was successful in a particular enterprise; however, the trade-off of trying to

accomplish too much tends to impacts his/her health (Frederick & Kuratko, 2010). In 2004,

Steve Jobs (co-founder of Apple) was diagnosed with a rare form of pancreatic cancer that

will eventually kill him, even though it was extracted. By 2009 he left the company (ABC

News, 2011). Possibly, the stressful job of constantly innovating and controlling Apple made

this state worse (ABC News, 2011). In the same way, a huge ego can lead to an overbearing

need for control and unrealistic optimism. At an extreme, a strong internal locus of control

will obsess the individual for autonomy and control. Within an organisation, this would affect

networking and communication as the person will try to impose his perspective (Frederick &

Kuratko, 2010). Analogously, too much optimism, together with the need to achieve, could

lead an entrepreneur to make wrong decisions by utilising flawed evaluations as outlined

before. The solution to both is simple: proper psychological therapy in order to balance the

characteristics (Gross, 2001).

Conclusion

In conclusion, various factors such as innovativeness (and creativity), risk-taking,

commitment, determination, perseverance, high-energy level, drive to achieve and internal

locus of control highlight the most common cited personality traits and characteristics found

in successful entrepreneurs. What is more, these factors demonstrate that a new venture

requires more than an idea, but a special individual who uses judgement, planning, and a

proper management style. It has also been shown the types of risks each characteristic

encompasses and solutions to entrepreneurs to address any problems. It will be impossible to

choose one as a definite common trait given that most of these, as demonstrated, are inter-

related. Thus, the entrepreneur must focus and combine as many as possible without leaping
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into extremes as a way to attain success in the business. The examples used have reinforced

the mentioned arguments, as well as giving a practical overview and application of the named

features.

Word count: 2,190

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