Are Some People Born to Be Entrepreneurs?
Study shows certain childhood behaviors common among entrepreneurs.
Whether you call yourself an entrepreneur, a freelancer, an independent professional or a gig worker, your behavior or experience as a child may have foreshadowed your career direction.
That’s according to new research by FreshBooks, a leading provider of small business invoicing software, that highlights what entrepreneurs had in common as children. The survey of 1,000 entrepreneurs found that 8 percent of entrepreneurs started their first business by the time they were 10 years old, and 26 percent said their parents helped them with their first business plan.
Case in point, FreshBooks’ co-founder Mike McDerment recently shared, in second grade he drew a video game design on the chalkboard for parent-teacher night and tried to sell copies to his classmates’ parents. Similarly, Vidyard founder Michael Litt confessed, “Before working anywhere formal, I sold firecrackers to friends at school. I got the firecrackers from my grandfather. I guess I’ve always been an entrepreneur. This experience taught me how to sell.”
These early encounters with launching a business idea demonstrate the importance of support from parents. Mark Cuban’s new book, “Kid Start-Up,” encourages parents to help their children with action plans and goal setting, whether they think the business idea is good or not. Setting simple business goals, like hours worked or units sold, can help teach kids valuable business judgment at an early age.
Switching homes and taking risks.
The survey highlighted that 34 percent of entrepreneurs are eldest children, the most likely to start their own business. Seventy-eight percent moved around at least once or twice as children and 38 percent moved three or more times. Switching homes can be a highly disruptive experience for children, yet can provide benefits as an adult. Adults who moved around as children often cite a much stronger sense of self, putting less stock in material things and having a much clearer idea of what they want out of life early on.
Despite the obvious risks of starting a business, 67 percent of entrepreneurs describe themselves as careful versus risk-taking. One reason for this could be the perception of risk. Sixty-three percent of entrepreneurs knew someone growing up who owned their own business. Whether it was a relative (36 percent), a sibling (11 percent) or a close family friend (14 percent), most entrepreneurs had someone in their lives to model themselves after. A role model or mentor can provide a blueprint for de-risking the act of entrepreneurship.
Daniel Saks, AppDirect Founder, saw entrepreneurship first-hand through his family’s furniture store. “At my family store, we sent hand-written notes to each customer for feedback on their experience with us,” said Saks. “This insight allowed us to make changes that ultimately lead to loyal customers and repeat business.”
Using real customer feedback to take calculated risks is aligned with the majority of entrepreneurs who describe themselves as careful. The morale of the story is not to leave your decision to chance. Rather, successful entrepreneurs mitigate risks in creative ways.
Education in the classroom and in the real world.
What’s more is that 58 percent of entrepreneurs say they were above average students. Only 6 percent rated themselves below average. There are high-profile stories about entrepreneurs dropping out of school to pursue their new-found businesses, but that doesn’t mean they weren’t high performers while in school.
“There is no magic formula to entrepreneurship,” says Laura Behrens Wu, co-founder of Shippo and graduate school dropout. “It’s a lot about hard work. It’s about being persistent. It’s about standing up again after you fail. It’s important to keep in mind that your company worth is not equal to your self-worth.”
Matt Baker is a contributing writer who covers finances and growth for small businesses. His industry experience includes VP Strategy at FreshBooks, engagement manager at McKinsey & Company, and senior strategist at Google, Inc. He also wrote a children's book.