42 Degrees - Business from a different angle

Nearly everyone dreams of taking control of their career at some point and setting up in business on their own. They may not necessarily want to be the next Bill Gates, but they wouldn't mind using their expertise to become their own boss. And if they happen to become fabulously wealthy in the process, who's going to complain?

Sadly, a recent survey by Business Link for London has poured cold water on those dreams. It found that the overwhelming majority of entrepreneurs attribute their success to natural talent rather than life experience. Seventy per cent of those questioned put their entrepreneurial ability down to personality rather than acquired skill, knowledge or personal attributes.

The research, carried out among 102 business owners in London, paints a picture of entrepreneurs as a self-confident, perhaps even arrogant, bunch. Sixty-one per cent put their success down to their own commitment and drive, just 13 per cent cited support from a partner or spouse as the key to their success. Only 5 per cent mentioned support from friends.

But are they right? Is it true that you cannot acquire entrepreneurial characteristics? Are entrepreneurs such as Stelios, Sir Philip Green and Sir Alan Sugar really born and not made?

Well, 'fraid so', say the experts. Dr Adrian Atkinson, managing director of business psychologists Human Factors International, argues that very, very few people, perhaps one in 5,000 managers, are what he calls 'true entrepreneurs'.

"The theory that anyone can become an entrepreneur is absolute nonsense," he says. "True entrepreneurs are people who create a business of significant value over at least five years and who put all their own assets, resources and reputation at risk to achieve it. They tend to be self-confident and highly competitive, not particularly good team players. Work is relaxation for them, so they will work every day of the year to get the business going."

True entrepreneurs, he says, tend to be restless and never satisfied with what they have achieved. "They are often intuitive in their decision making and willing to risk everything, their reputation and resources, on a business start up in which they believe. They are likely to be very egocentric, highly resilient and may have failed in three or four businesses before succeeding."

While many of these attributes are not necessarily innate, they are certainly in place by the time a person reaches late teens. "Genetics do set potential," he says, "but childhood experiences can determine a person's approach to life and their ability to fulfil their potential."

The point is that you can't acquire these characteristics as an adult by training or sheer willpower. Trying to force yourself to be something you are not can prove damaging both personally and financially, he argues: "I often have people saying they are going to sell everything and become an entrepreneur, and I say, 'For goodness' sake, don't do it.' Very few people are wealth creators and it is really important that people realise where their strengths lie."

It sounds like bad news for the school of thought, not to mention the schools of business, which say that anyone can do it if they put their mind to it and learn the essential skills.

The good news is that, according to Atkinson, entrepreneurs are but one type of 'wealth creator'. Twenty years of research have identified three more groups. 'Enterprisers', for instance, seek excitement from analysing the market and then making things happen. They find personal risk taking exciting but they prefer to share the risk and the rewards with others.

Then there are 'Corporates', who are interested in developing a business within existing structures. They achieve by energising the various functions and groups in an organisation. And finally there are 'Experts', people who are not so attracted by personal risk or by commercial challenge. They see value in getting the processes right and often have a focus on achieving high quality in what they do.

Paradoxically, Atkinson argues that there are many rich people who are not wealth creators. He says that city traders, for instance, are simply gamblers. And there are also many people who can happily run their own businesses, but will never create much wealth.

The trouble with this argument is that if entrepreneurs are born, then the government may as well give up trying to promote business start-ups and new economic activity, says Professor Gordon Murray, of the University of Exeter's School of Business and Economics and advisor to the government's Small Business Service.

"Yes, some people do have a natural proclivity to independent economic action," he says. "They usually come from families with a tradition of independent economic activity."

But conditions in the outside world do affect the rate of new start-ups – which suggests that to some extent entrepreneurs are made by the environment: "Look at the early Thatcher era, or the dot-com boom. It seemed like everyone was starting a new business."

So he believes that government policy can affect the number of those willing to take risks in business. "Compare Europe to the US where failure carries less stigma and bankruptcy laws are more benign," he says. "Is it a coincidence that the US has a more entrepreneurial culture?"

Then there is the question of life-stage. "If you are in your early thirties with kids to support and an expensive mortgage, that's not a great time to start a business. That's why there is a spike in entrepreneurship in people's late forties and early fifties."

His message is clear. Entrepreneurial characteristics are not entirely innate. The environment does affect individuals' ability to become entrepreneurs. But it is almost certainly too late to turn yourself into an entrepreneur if you don't have the emotional make up for it. The time to really make a difference is in one's formative years.

However, that doesn't mean you are condemned to a life of working for others. There are four million small businesses in the UK with millions of people leading perfectly rewarding and satisfying lives as a result. You just need to recognise what sort of person you are before you go into business for yourself.