Psychology of an Entrepreneur

‘Entrepreneurship’ is one of the most popular words of the last decade. Regardless of their financial literacy status, many people want to start a small business, participate in startups, or channel their investments to new and exciting areas. Some of these people eventually decide to give their ideas a try and take the jump by using their hard-earned savings for relatively risky ventures. Sadly, many of these adventurous people fail before fulfilling their dreams and quit entrepreneurship very early. A few, though, push through the boundaries and succeed in starting their businesses or making effective investment choices in relatively unknown fields. But what makes these successful entrepreneurs apart from many that try? What are the psychological processes that govern their minds?

Do they like taking risks more?

When thinking about an entrepreneur, the first thing that comes to mind is that they should be more enthusiastic about taking risks. However, this behavior is a misconception since research on entrepreneurs has shown that they are less prone to take risks than the general population. One significant difference is that they analyze the risks better and are more aware of the possible implications of their potential failures. They know what is at stake and are ready to accept the consequences of the unexpected happens. While other people tend to ignore the possibility of failure, the entrepreneurs are fully aware of the risks associated with ventures and have plans at hand to deal with them. 

Do what you love or love what you do.

An exciting finding of studies assessing entrepreneurial thinking is that entrepreneurs are not doing things just for capital. They have other drives such as solving a problem, finding a brand-new way to do something, or developing new technologies. They might have a considerable income level in this way, but the primary motivation is the job itself. In a recent study, researchers have found that entrepreneurs' brain activities were similar to those of fathers being shown pictures of their children when shown the images of their businesses. This finding alone underscores the importance of loving the job. It is not enough to find a good idea to be a successful entrepreneur; the love and commitment for the business counts. 

The concept of confidence

It is not surprising that confidence in oneself and one's business is required to start a successful business. What entrepreneurs have that sets them apart is not overconfidence or believing that everything will be great. Entrepreneurs are aware of the potentials for failure in their ventures but proceed anyway. Thinking that everything will run smoothly and success is an inevitable conclusion creates an illusion that sets the scene for failure. Entrepreneurs know how to avoid this trap, carefully analyzing how things can go wrong. In addition to that, when things go wrong – and they inevitably do in all sorts of businesses – they try to learn from those and how they could have somehow avoided the failure. With this mindset, every failure is a potential for gain, and every mistake is an opportunity to learn how not to repeat it. 

Willingness to try new things 

Without a doubt staying focused on the job at hand is a prerequisite every successful businessperson should have. That does not mean that entrepreneurs should limit their attention only to their ventures and ignore everything else. On the contrary, being open-minded about the world, in general, helps entrepreneurs in their businesses. In a study, when given a questionnaire that assesses openness, entrepreneurs scored higher than white-collar workers. Keeping their eyes open for the world around them and the events unfolding, they learn to approach the problems from different angles and come up with innovative answers. Also, this correlates with valuing other people's opinions and feedback. As is apparent from the discussion, entrepreneurs try to maintain a growth mindset rather than a fixed one.

Some people think that entrepreneurship is like a gamble; you invest your earnings with hopes of gain but a chance of losing everything. Entrepreneurs do not see it that way and think of the whole entrepreneurship journey as the gain itself regardless of the outcomes. Science showed that entrepreneurs have different habits, mindsets, and thought patterns, but they are not fixed in stone. Anyone with entrepreneurial inclinations can modify their thinking and actions to correlate better with their goals. 

Dr. Egehan Salepci

Related Articles

As one of the strongest and most reliable institutions in the banking sector, Halkbank serves its customers through its branches, offices, private transaction offices, and foreign representative offices throughout the country. Halkbank offers comprehensive financial products and services in order to make the dreams of Turkish investors’ come true.