Entrepreneurial mindset can be defined as:
“A specific state of mind, which orientates human conduct towards entrepreneurial activities and outcomes. Individuals with entrepreneurial mindsets are often drawn to opportunities, innovation and new value creation.” (Financial Times).
Statistics form the Global Entrepreneurship Monitor (GEM) show that more people than ever are realising the dream of starting their own business.
In our modern world, entrepreneurship is seen as a positive thing and most governments have a wide variety of business supports available to the budding entrepreneur to support the process of company formation and progression.
Motivation of entrepreneurs
There are many reasons why people are motivated to set up and run their own business.
It may be that they have a good business idea, they may wish to become self-employed, they may believe that there is increased financial opportunity or they may wish to have the status of being a business owner.
If you are one of those people who dreams of starting your own business, forming a company and being your own boss, a knowledge and understanding of how the mind of an entrepreneur works can help you to understand what it takes to start and build a successful business.
Countless studies have been done in an attempt to understand the mindset of entrepreneurs. These studies show that there are common personality traits, characteristics and skills that all successful entrepreneurs have.
If a few of the following attributes apply to you, then you could be on the way to becoming the next Bill Gates, Richard Branson or Jeff Bezos.
1. Need for achievement
The need for a high level of achievement is a strong trait in entrepreneurial types. This drive keeps them going when they encounter obstacles and difficulties during the process of building a business.
Those who have this trait are also motivated by the achievement of the status that comes with being the the owner of a successful, thriving business and the significant financial reward that may be attained.
2. Autonomy and control
Many entrepreneurs decide to start a business, because they are not satisfied working in a job where they are using their skills and knowledge for somebody else’s benefit.
They want to make their own mark on the world.
Successful entrepreneurs are usually strong-willed, focused and independent, so they prefer to be in control of their own life and business as it suits their personality better.
In spite of the fact that self-employed people usually end up working longer hours than those in employment, they are happy to do so, because they are doing it for themselves.
It is difficult to become a successful entrepreneur, if you are risk-averse.
In order to be successful you will need to take some risks.
There is a difference, however, between being a risk taker and being reckless. A clever entrepreneur will take a calculated chance only after they have taken the necessary steps to minimise the risk.
Richard Branson took huge financial risk when he moved into the airline business, if the move had gone belly up, he stood to lose everything he had achieved with Virgin Records, instead he ended up with an even more successful venture in Virgin Airlines.
It is important to carry out adequate planning and forecasting before investing time and money in a business venture, but at the same time you should not overthink the potential problems that may arise.
Once a decision is made, action should quickly follow.
4. Creative and innovative
Creativity and innovation are usually strong characteristics of an entrepreneurial mindset.
Original and creative thinking allows entrepreneurs more easily identify opportunities for business creation and growth.
Those with a good business mind have the ability to come up with new ideas or new ways of doing things, to fill a gap they have seen in the market or to improve on existing products or services.
Due to his frustration with the efficiency of household vacuum cleaners, James Dyson, an engineer, began to work on a solution, and following many failed attempts at prototypes , (5126 to be exact) the Dyson vacuum cleaner was launched.
James Dyson is now a multi-billionaire and has gone on to innovate and create new and more efficient versions of other electronic products such as hand-dryers and hair dryers.
“Having an idea for doing something better and making it happen – even though it appears impossible. That’s still my dream.” – James Dyson.
5. Good business acumen
A person with an entrepreneurial mindset, is financially savvy. They are always keeping an eye on the numbers in the business to make sure that the business remains solvent.
They will make good use of the resources they have available to them in a creative and flexible way and know how to gather other necessary resources that will help their business to succeed.
Warren Buffet made his first investment in stocks at 11 years of age, through his father’s business.
He made his first profit when he sold the stocks for more than he paid for them.
By age 13, he was running two businesses, a paper round and selling a horse-racing tip sheet.
In hindsight, this was a good indicator of how he would go on to become a massively successful businessman.
Most people who are successful, have at least a couple of failed ventures under their belt.
JK Rowling was rejected by 12 publishing houses for The Harry Potter Books before finally being published.
It is estimated that 400 million Harry Potter books have now been sold worldwide.
An entrepreneur sees failures as an opportunity to learn and grow, they do not become despondent and give up. They will keep trying until they achieve their goals.
However, just because entrepreneurs are resilient and able to dust themselves off after failed attempts, it does not mean that they like to fail.
Their strength of their drive to succeed is one of the main reasons why they will not allow failure to overcome them.
7. Communication and networking skills
In order to be successful, an entrepreneur must have the ability to communicate in a manner that evokes a strong emotional response in others, whether it is to inspire their staff to work hard, to convince investors to part with their money or to persuade customers of the need to buy their product.
An effective network of contacts that are valuable to the business can be built by using every interaction; personal, social and business, as an opportunity to build strong and positive relationships that will benefit the company in the longer term.
If you have good foresight and can see opportunities before others see them, then you will increase your chances of success in the business world.
Jeff Bezos of Amazon, now the richest man on the planet, saw the massive potential that was on the horizon for online shopping, before anyone else saw it.
He started by selling vast quantities of books online at lower prices than traditional shops and then as the market changed and grew, he adapted and remodelled his business to meet consumer needs.
9. Leadership skills
Entrepreneurs tend to be leaders rather than followers.
They have the ability to inspire those around them to work with them to achieve their vision and goals.
The entrepreneur must be able to delegate and trust the team around them, it is impossible to build a successful business with the help and support of others.
Motivational leaders display traits such as honesty, integrity, respect and humility, because of this, they are trusted by those around them and achieve high levels of cooperation from others which improves chances of success.
Self-belief and self-efficacy are valuable qualities for an entrepreneur.
If you are comfortable in your own skin and trust yourself to make decisions, without relying too heavily on others, you will be able to act quickly and decisively when things need to be done.
You need to be able to trust your gut instinct, many important business decisions have an element of “going with your gut”. It is only those with a high level of self-belief that can trust their own intuition and do things that don’t always make sense to those around them.
11. Open-minded and flexible
A successful entrepreneur must be open-minded, always prepared to listen and take on board advice.
Flexibility and being open to adapt and change plans or direction if circumstances change are necessary traits for a business owner to have as being too rigid and inflexible can be catastrophic to the solvency of a business.
Twitter started life as podcast subscription network called Oreo. When iTunes came along and the founders identified a serious threat to their business, they brainstormed with employees and Twitter as we know it today, was born. This turn around happened in two weeks.
Entrepreneurs embrace change, they love to challenge the status quo rather than remaining stagnant.
They are also continually seeking and learning new information, so that they can stay one step ahead of everyone else in their field.
It is not enough to have a good idea in your head or on paper.
Without action, a great business idea, will remain a fantasy in your head.
Many people dream of starting their own business and may even have a good business idea or several.
However, the difference in the entrepreneurial mindset is the ability to take action to convert these ideas into reality.
Entrepreneurs will develop strategic goals and action plans and set out the steps that are needed to achieve them.
If you have an idea or a strong drive to start a business and think that you possess some level of an entrepreneurial mindset, there is no reason why you should not go ahead and take a chance.
If you don’t try, you will never know.