Can Personality Predict the Performance of Entrepreneurs?

This statement is true. Studies of identical twins reared apart suggest striking career similarities—if one twin became an entrepreneur, the other twin was more likely to do the same.

The explanation may lie in personality.

One recent analysis of 60 studies linked individuals’ personalities to their intentions to undertake an entrepreneurial career, and to the performance of their ventures once they made that decision. The Big Five personality traits—except agreeableness which didn’t matter—significantly predicted entrepreneurial intentions and, more significantly, entrepreneurial firm performance. Especially important were openness to experience and conscientiousness, both of which also predicted firm growth over time. Interestingly, risk propensity—the tendency to take and be comfortable with taking risks—was not associated with entrepreneurial performance.

What are the implications of these findings?  Traditionally, people who saw themselves as risk averse were steered away from entrepreneurship. However, these results suggest it is more important to steer low scorers on openness and conscientiousness away. The best entrepreneurs appear not to be the swashbuckling risk-takers, but rather the methodical ones who have the discipline to turn their open thinking and creative ideas into reality.

 

Source: H. Zhao, S. E. Seibert, and G. T. Lumpkin, “The Relationship of Personality to Entrepreneurial Intentions and Performance: A Meta-Analytic Review,” Journal of Management 36, No. 2 (2010), pp. 381-404; M. Herper, “Could We Invent an Antibody to Make You an Entrepreneur?” Forbes (May 5, 2011), downloaded on May 23, 2011 from http://blogs.forbes.com/.