The Psychological Factors of Entrepreneurship

Entrepreneurs are individuals who start their own businesses, usually because they have a skill or talent that translates well into a moneymaking venture. The combination of drive and passion that prompts individuals to become entrepreneurs can lead to great personal satisfaction and a positive worldview. However, the workload demands of launching an enterprise require that entrepreneurs make sure they’re staying healthy, both physically and mentally.

To learn more, check out the infographic below, created by Maryville University’s Bachelor of Arts in Psychology online program.

Entrepreneurship can be exciting, but it entails more than creating something and being one’s own boss. Prospective entrepreneurs should know certain aspects about it prior to taking the plunge.

An entrepreneur is a risk-taker who’s willing to roll the dice on an idea that may reap significant rewards. For this risk to ultimately be fulfilling, they must have the ability to combine resources, labor, and capital to either manufacture the goods or provide the service they have in mind. They must also possess the skills needed to create business plans, hire the right labor, acquire the necessary resources, and manage a business as it forms. Finally, they must also use their abilities to take initiative and anticipate the needs of the market.

While the term entrepreneur refers to the concept of individuals starting a business, different types fall under the overarching concept.

Small-business entrepreneurs typically use their own money to get started and live off the business profits. Examples of this type of entrepreneurship include a single-location restaurant or grocery store, a small retail shop, a freelance web design services provider, a home-based tax preparation services provider, and a YouTube digital influencer channel.

Startup entrepreneurs have a unique product or service to offer. They may seek investors and need large amounts of capital, and they carry intentions to continually grow and expand their companies.

Large-company entrepreneurs launch a new business division or product line within an existing business. These ventures come from an innovative idea from a leader or employee; because their ideas come from within a company, they can be called “intrapreneurs.” The idea they come up with can either build on an existing business or enter a new market.

Finally, social entrepreneurs see a problem in the community that needs to be addressed or seek to make social change. Examples of this kind of entrepreneurship in action include the creation of a new nonprofit organization or a new division of an existing nonprofit.

Keeping an entrepreneurial idea going can be challenging. While 80% of small businesses last two years, only 55% last five years, and just 35% last 10 years. The success of a business could depend on where it started. For instance, 42.6% of new businesses originating in North Dakota last 10 years, while only 26.4% of new businesses in Florida reach that milestone.

The average age of American business founders who go on to hire at least one employee is 42. The average annual salary an entrepreneur makes is $62,000. Additionally, entrepreneurs who start a business that closely aligns with their previous experience are significantly more likely to achieve high growth.

Entrepreneurship has both positive and negative aspects. While the pluses can outweigh the minuses in the long run, prospective entrepreneurs should understand the hurdles that may appear on the path toward success.

Entrepreneurs often find greater job satisfaction from pursuing their passion. They also enjoy the freedom of making decisions without supervision. Additionally, they can often exhibit positive characteristics such as self-belief and initiative. They can also channel their stress over challenges into creative energy. Finally, they commonly adopt an “entrepreneurial mindset,” which can include skills and capabilities such as adaptability, collaboration, comfort with risk, critical thinking, flexibility, innovation, resourcefulness, and self-reliance.

Being an entrepreneur also comes with challenges. For instance, entrepreneurs face high expectations from investors, employees, and the media. They can often work more than 40 hours per week. Because they focus their attention on factors such as planning, productivity, networking, and financial success, they may spend less time with their families and friends.

Additionally, they may neglect their physical and mental health through a lack of exercise, nutrition, rest, and relaxation. Plus, the “hustle” culture in business encourages an attitude of “fake it until you make it.” This culture creates a stigma around asking for help, and it can suggest that an entrepreneur must always seem successful to be successful. This could lead to stress and anxiety around looking vulnerable or weak.

Entrepreneurs should remember to protect their mental and physical health throughout their business ventures. Fortunately, doing so is not as difficult as it may appear.

While entrepreneurs may exhibit resilience, these hardworking individuals need to take certain steps to make sure they maintain their health while achieving their career goals.

One of these steps involves reaching out to others. Entrepreneurs shouldn’t be afraid to ask for help and utilize their support systems. They should also avoid letting the pressure to “hustle” prevent them from taking care of themselves and the people who are important to them.

Entrepreneurs benefit from making a strong mind-body connection. This can include eating well and exercising to maintain energy and focus. It can also include setting aside time for rest, recreation, and recharging. Other helpful practices include keeping snacks around them as they work, as well as taking short breaks to stand and stretch.

A third tip is to take the time to socialize with family and friends. This can help entrepreneurs maintain a proper work-life balance and serve as a reminder that they’re more than their work. They can achieve this goal through making time for their personal networks and scheduling time away from work to relax. Ultimately, fostering these relationships can help give an entrepreneur’s brain a chance to focus on things besides work to refuel their creative energy.

In addition, monitoring health is a crucial component of self-care. Avoiding stress triggers is key, as is learning how to relieve stress or channel it into productivity when these triggers are avoidable. Entrepreneurs should learn about the warning signs of physical and mental health conditions associated with work stress, including anxiety and depression.

Finally, entrepreneurs should commit to making their businesses a pleasant place to work. For example, they can factor corporate wellness resources into their business strategies. This might entail including an expense line item for the health and wellness of the founders and employees. Building breaks into the workday and providing help resources for all employees can also be important to fostering a healthy workplace.

A number of organizations can provide support for entrepreneurs who are struggling to maintain their well-being. For instance, entrepreneurs may find support by joining a peer group. Alternatively, they can listen to mindfulness podcasts or download meditation apps. They can also discover self-help resources such as books and websites. Additionally, if an entrepreneur feels particularly at risk, they can contact support groups or medical professionals.

Being an entrepreneur is an exciting and worthy endeavor, but starting a business can be stressful. Taking the time to care for your physical and mental health is important and will lead to a better business.

Sources

The Conversation, “How Entrepreneurs Have the Most Stressful — Yet Most Satisfying — Jobs”

Everyday Health, “The Right Resources Can Help You Manage Depression”

Future Founders, “Mental Health Tools and Resources for Entrepreneurs”

Healthline: “Work Depression: How to Take Care of Your Mental Health on the Job”

Investopedia, “Entrepreneur”

Network for Teaching Entrepreneurship, Entrepreneurial Mindset

Small Business Trends, “Startup Statistics — The Numbers You Need to Know”

SSRN, “Age and High-Growth Entrepreneurship”

Tech Crunch, “Investors and Entrepreneurs Need to Address the Mental Health Crisis in Startups”

Thrive Global, “15 Tips for Entrepreneurs New to Practicing Mindfulness”

United States Census Bureau, Entrepreneur Income

U.S. Bureau of Labor Statistics, Entrepreneurship and the U.S. Economy

YouTube, “The Sleep Revolution”