Do you have what it takes to be an entrepreneurial leader & startup founder?

In an old Monty Python sketch, the middle-aged Mr Anchovy, played by Michael Palin, wants to give up what he calls the desperately dull world of chartered accountancy in order to become a lion-tamer. His ‘vocational guidance counsellor’, aka John Cleese, suggests he consider an interim career path – banking, say – while he works towards lion-taming. No, no, no, no, no, Mr Anchovy interrupts. I don’t want to wait. At nine o’clock tomorrow I want to be in there, taming.

Fast forward fifty years, and now everyone wants to be an entrepreneurial leader, a startup founder. Lion taming is so passe. Entrepreneurial leaders have become the new role models of the C21st, seen as pioneers in the mold of earlier innovators like Edison. However, we fall back on broad stereotypes without really understanding what makes such leaders unique.

The concept of entrepreneurial leadership suggests that in dynamic new endeavours, with increased uncertainty and pressure, a new type of leader is required. Those with an ‘entrepreneurial’ approach can see, take action, and exploit opportunities faster than others.

So, is this for you? Have you got the ‘entrepreneur dna’ in your mindset and skillset? Let’s look at research by Tim Butler from HBS who compared psychological test results of successful entrepreneurs against those of business leaders who described themselves as successful business managers, but not as entrepreneurs.

Unsurprisingly, the two groups had much in common. On 75% of the 40+ dimensions of leadership evaluated, there was little or no difference between their skills. Yet when Butler looked more closely, combining the skill assessments with data on their personality traits, he discovered that entrepreneurial leaders had three distinguishing characteristics:

  • the ability to thrive in uncertainty
  • a passionate desire to author and own projects
  • unique skills at persuasion and influence

Butler also found that many of the traits popularly associated with entrepreneurial leaders didn’t truly apply. For example, entrepreneurs aren’t always exceptionally creative – but they are more curious and restless; they aren’t risk seekers – but they find uncertainty and novelty motivating. Butler’s research tackled some of the myths about entrepreneurs and explained the more nuanced reality.

Four key elements emerged from Butler’s research around the popular perceptions about entrepreneurship, and the true drivers of entrepreneurs. Reflect on this, and what it says about the future entrepreneurial leader in you.

1. The Stereotype: entrepreneurs are unusually creative. The Subtler Truth: entrepreneurs are curious seekers of adventure, learning and opportunity.

A popular notion is that entrepreneurs enjoy changing, innovative environments and are more creative than others. But ‘creative’ can mean fixing things that are broken and. while it’s true that entrepreneurs excel at original thinking, so do many non-entrepreneurs. In reality, what sets entrepreneurial individuals apart is the ability to thrive in ambiguity and tolerate uncertainty.

A critical aspect of this is openness to new experiences. Butler found that the single entrepreneurial trait that most distinguishes them is having a hunger to explore and learn, a heightened state of motivation that occurs at the edge of the unknown and the untried. The unknown is a source of excitement rather than anxiety. They don’t see the constraints of boundaries, rather ‘now, what do I want to create here?’ Entrepreneurs enjoy the ‘dreaming it up’ process.

2. The Stereotype: entrepreneurs enjoy and seek risk. The Subtler Truth: entrepreneurs are more comfortable with risk.

Another prevailing view is that entrepreneurs love the thrill of taking chances. This is not true; entrepreneurs are not skydivers, they seek to minimise risk but have higher comfort and tolerance thresholds to risk. In other words, when accepting risk is necessary to reach a desired outcome, entrepreneurs are better at living with it and managing the anxiety that might disable others.

Entrepreneurial leaders aren’t necessarily more stress-hardy, rather the highly unpredictable and ambiguous reality of startup environments are a source of motivation. This is a second reason they thrive in uncertainty. Openness to new experiences and comfort with risk are the main components of their ability to perform well.

Lotus blooms in the muddy pond is a famous Japanese allegory to reflect upon for any startup that has stalled. It is important to press pause and learn from your oversights, and then resolve to never repeat them. In this way, a period of unforeseen challenge can become a springboard for future, productive growth.

3. The Stereotype: entrepreneurs are more ambitious than other leaders. The Subtler Truth: entrepreneurs are driven by a need to own products, projects, and initiatives.

Entrepreneurial leaders score exceptionally high on the need for power and control. We know many have big personalities and are extroverts. Butler discerned an interesting variation on the need for power in that it’s less about dominance and more about ownership, and ‘making a mark’. It’s not about having authority, it’s about having control over the finished product. In this way, entrepreneurs have more in common with authors and artists than we think.

Entrepreneurs are hands-on, they want to be in the middle of the buzz and hustle as a new venture comes to life. They are not ones to linger in the corner, sitting on their hands. They want to be the artisans with their hands on the wet clay. They want to take a finished piece from the kiln and say, ‘This is mine – I did this’ – not in an egotistical sense but in the manner of ‘I shape materials that become valuable and useful things.’

Long after Apple had become a large company, Steve Jobs was part of every critical design discussion, hold prototypes in his hand, and assessed every detail. Power for the entrepreneurial spirit is about being the owner of and driving force. Getting it right becomes a compulsive obsession. Entrepreneurial leaders do not see themselves as exerting power or authority from the top of the pyramid, rather they see their role as being at the centre of a circle, creating and enabling with their energy, influence, and resources. Their venture is an expression of who they are.

4. The Stereotype: entrepreneurs are natural salespeople. The Truth: This one is correct.

Butler’s research corroborated earlier studies that highlighted the importance of confidence and persuasiveness among entrepreneurial leaders. When it’s crucial to get somewhere or make something happen, but it’s not clear how to do so, you must, first believe that you can reach your goal and, secondly, convince all the people whose help you need that you can, and very often, with little or no evidence to back you up.

Many startup founders have to sell their ideas to early adopters, then paying customers and initial investors, but they’re not trained salespeople, and are often clumsy in the sales process. However, they have a natural self-belief, sell the vision, and remove all roadblocks as they create personal engagement.

Entrepreneurs jump on the roller coaster ride where the tracks haven’t yet been fully built. They’d have it no other way, happy going round blind corners and crazy inclines. A good part of it is fighting the urge to revert to their comfort zone. Having to pick themselves up from setbacks, dust themselves off and go again, is an accepted part of the journey.

Is there a Playbook for this? Alongside Butler’s research, I like Ryan Holiday’s book, The Obstacle Is The Way, which offers valuable insight and guidance, drawing lessons from philosophy and history, showing how to be prepared for being an entrepreneur, being bold and mentally able to handle the pressure of running a startup. Here are some quotes from his book, which I think say a lot about building your mindset to make something stunning.

Where the head goes, the body follows. Perception precedes action. Right action follows the right perspective. When something happens, you decide what it means. Is it the end? Or the time for a new start? Is it the worst thing that has ever happened to you? Or is it just a setback? You have the decision to choose how you perceive every situation in your startup life.

I can’t afford to panic. Some things make us emotional, but you have to practice keeping your emotions in check and balanced. In every situation, no matter how bad it is, keep calm and try to find a solution. Sometimes the best solution is to do nothing. Entrepreneurs find it hard to say ‘stop’, but that can be the best reaction at times.

No one is asking you to look at the world through rose-coloured glasses. See the world for what it is. Not what you want it to be or what it should be. Hey, we’re back to being realistic – but it’s also about optimism, the mindset to expect the best outcome from every situation – and that’s resilience to make it happen. This gives entrepreneurs the capacity to pivot from a failing tactic and implement actions to increase comeback success.

If you want momentum, you’ll have to create it yourself by getting up and getting started. If you want anything from life, you have to start moving towards it. Only action will bring you closer. Start now, not tomorrow. Maintain active optimism, observing how others were successful in similar situations, and believing you can do the same. Equally, it’s not what happens to you, but how you react to it that matters.

It’s okay to be discouraged. It’s not okay to quit. Entrepreneurial life is competitive. When you think life is hard know that it’s supposed to be hard. If you get discouraged, try another angle until you succeed. Every attempt brings you one step closer. Don’t have a victim’s mindset. Great entrepreneurs become tenaciously defiant when told they cannot succeed. Then they get it done.

We must be willing to roll the dice and lose. Be prepared for none of it to work. We get disappointed too quickly. The main cause? We often expect things will turn out fine, we have too high expectations. No one can guarantee your success so why not expect to lose? You try with all your effort, it doesn’t work out, you accept it, and move on. Understand that any decision is usually better than no decision.

The path of least resistance is a terrible teacher. Don’t shy away from difficulty. Nurture yourself: gain strength from the unrealistic achievements of others. To be remarkable, you have to expect unreasonable things of yourself. In a startup, when you overcome one obstacle, another one waits in the shadows.

Entrepreneurial leaders know who they are and what is meaningful to them. However, the characteristics and traits outlined don’t come scripted.  The path to entrepreneurial success is forged via breakthroughs, small steps, and iterations, each possible because you have your eyes and ears wide open and you’re able to reflect and adjust time after time, with the resilient mindset to keep going. Recall the three key attributes from Butler’s research:

  • the ability to thrive in uncertainty
  • a passionate desire to author and own projects
  • unique skills at persuasion and influence

Do you recognise these traits in yourself? Entrepreneurs choose the life of challenge and hardship, gambling for achievement, but also inevitably encountering times marked by confusion, chaos and disappointment. They consciously choose a life in which the peaks and troughs are more vivid than if safer choices made. Is this for you? Can you manage this volatility?

Many of the younger startup founder wannabes I encounter are lured by the eat-what-you-kill excitement of early-stage ventures, without reflection on do they have what it takes. But if they ignore self-analysis, they should not ignore comedy. Mr Anchovy never did become a lion-tamer. What he thought was a lion was instead an anteater. Shown a photo of a real lion, he passed out.

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