Origins of an Entrepreneur
In summer 2009, The Aldridge Foundation commissioned a survey of a sample of 370 successful, leading entrepreneurs, defined as having run a business for at least two years, and employing a minimum of five staff. The joint aims of the survey were to establish their educational and socio-economic backgrounds, analyse the main triggers for setting up their own businesses, and identify what action they believed could be taken to encourage a greater number of young people to consider entrepreneurship as a career option.
Whilst 60% of those surveyed had attended university, around 11% had no formal qualifications whatsoever. Those who had attended university did not believe that academic qualifications had aided them in their entrepreneurial career.
A fifth of those surveyed believed that the most important means of increasing the number of young people setting up their own business was to teach enterprise and business studies more prominently within schools, and 21% believed that providing students and young people with opportunities to learn from entrepreneurs who have experienced business in the real world would provide the catalyst and support required. Another 14% believed that young students should be offered free business advice, which would remove some of the mystery of dealing with legal and financial matters.
There was also a strong feeling that a change in the prevailing and institutionalised fear of failure was necessary, to remove the stigmatisation of those whose first business was not successful.
One entrepreneur, Natalie Campbell, highlighted within the survey the first part of her journey. “I started my first business franchise when I was at university and, due to the collapse of the parent company, my business went into administration. The social stigma and financial repercussions were awful. The irony is that it is the best part of my entrepreneurial journey. When I talk honestly to business students about starting up a business, it is the fact that I learnt from that experience and picked myself up that they find most inspiring and valuable.”
This perfectly demonstrates how young people need to hear both the positives and negatives of the entrepreneurial story – both to learn from others’ mistakes, and also to learn that failure need not be the end but rather the chance to develop experience and strive to succeed. By connecting such inspirational speakers with schools some of that fear of failure can be mitigated.
Of those surveyed, only 12% had come from affluent backgrounds. Most entrepreneurs had grown up in middle income families (54%), with 34% coming from low income families. However, 39% had had the ability to self-fund their ventures – only 9% had received external investment that did not come from friends and family or from a bank loan.
The indication from this was that those from lower income backgrounds could have difficulties in financing a new business, where they may be unable to self-fund, friends and family may not have the means, and a low credit rating may prevent them from receiving back loans. This very much suggested that opening pathways to access funding was vital in encouraging the next generation of entrepreneurs, with 13% of those surveyed believing that this was the most important means of supporting entrepreneurs from disadvantaged backgrounds. Providing financial management support within education could also aid those who needed to either save or take out loans in order to finance their new business.
Entrepreneurship is clearly a career option for everyone. Whilst core skills in literacy and numeracy are vital, academic attainment is not in itself a vital prerequisite for a young entrepreneur, and can indeed stimulate the minds of those who have not been inspired by traditional subjects or teaching methods. One of The Aldridge Foundation’s next reports will be on the teaching of entrepreneurship in a school environment, using the case study of our own Academy within Darwen near Blackburn, which instils entrepreneurial characteristics into students from Key Stage 3.
By providing real life case studies from which to learn, and real life businessmen and women who can share their knowledge, schools can support the development of entrepreneurial skills. As well as teaching business studies, schools should look for means of developing and nurturing key attributes such as determination and passion, and also ensuring that students leave with strong core skills and employability skills.
Whether these skills are then used to start and run successful businesses, or whether they are used as the foundation for a successful career as an employee, they will stand students in good stead whatever their future.
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