Entrepreneurs are successful, rich, and attractive. They are highly dedicated and focused, incorporating healthy routines and mindfulness into their extraordinarily successful habits. They are in rewarding, romantic relationships and can choose how to fill in their time – enjoying a rewarding work-life and luxury travel experiences whenever they desire...
The previous description is how entrepreneurs are typically portrayed. We are often presented with success stories of entrepreneurs. Social media content tends to glamorise the positive aspects of being an entrepreneur while hiding the negative, darker sides. In this topic, we will explore the stresses and darker aspects of what the entrepreneurial reality really looks like.
Welcome to Topic 8: The Dark Side of Entrepreneurship. In this topic, you will learn about:
- Various negative aspects of entrepreneurship
- Some of the challenges associated with being an entrepreneur
- The risks entrepreneurs must face
- The similarity between entrepreneurs and criminals.
These relate to the Subject Learning Outcomes:
- Discuss the importance of entrepreneurship as a driver of growth and how it varies from "business as usual".
- Identify generally shared traits of entrepreneurs, although there is no single set of entrepreneurial traits.
Welcome to your pre-seminar learning tasks for this week. Please ensure you complete these prior to attending your scheduled seminar with your lecturer.
Click on each of the following headings to read more about what is required for each of your pre-seminar learning tasks.
Steve Jobs is often named as an example of a well-known entrepreneur. The following videos highlight parts of his personality and interactions with others.
Watch the videos on Steve Jobs and note down his qualities as an entrepreneur in your reflective journal. Pay particular attention to qualities that may not be so admirable.
- The real genius of Steve Jobs, shows Steve Job's views on leadership and delegation early on in his career.
- 10 Things you didn't know about Steve Jobs, provides some quirky facts about Steve Jobs and gives us an insight into what he was like.
- Steve Jobs talks about managing people, as part of a review of his autobiography, gives an insight into Steve Job's personality.
- Steve Jobs - inspirational speech "If today were the last day of my life", sets out Steve's attitude to living without regrets.
You can access the reflective journal by clicking on ‘Journal’ in the navigation bar for this subject.
Unfortunately, one of the challenges that many entrepreneurs must deal with is depression. The following video shows an entrepreneur who shares his own experiences with depression. Pay attention to the courage he shows being vulnerable and open in sharing his story.
Angel, B 2019, How this entrepreneur overcame depression, streaming video, the Entrepreneur.
The following video discusses the impact of an unrealistic view on entrepreneurship that we are presented with on social media. It also looks at the constant hard work and sacrifices required.
Real MFs, 2020, The dark side of entrepreneurship – eye opening video, streaming video, YouTube.
Task: Watch the video and be prepared to discuss your views in the seminar.
The following video features Gary Vee, who discusses the pressure and loneliness associated with entrepreneurship.
GaryVee TV, 2019, Why being an entrepreneur is lonely, streaming video, YouTube.
Read Kets de Vries, M 1985, The dark side of entrepreneurship, University of Illinois at Urbana-Champaign's Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship.
Task: Use the information presented in this article when completing your discussion forum post as part of learning task 8.
Read Shepherd, DA & Patzelt, H 2015, The “heart” of entrepreneurship: The impact of entrepreneurial action on health and health on entrepreneurial action, Journal of Business Venturing Insights, 4:22-29.
Read through the topic content and action the learning tasks within it.
Complete the following task in Topic 8: Forum activity 1. You can also navigate to the forum by clicking on 'ENT100 Subject Forum' in the navigation bar for this subject.
- Research one (1) of the following aspects of the dark side of entrepreneurship and post your findings. You can focus your research on:
- Loneliness
- Stress
- Obsessive behaviour
- Criminal behaviour
- Recklessness
- Or any other aspects related to the content of this topic that interests you.
- Where possible, provide examples of the impacts this has had on entrepreneurial ventures or entrepreneurs themselves.
- Reply to at least two (2) other posts.
While there is much research into the positives or the ‘light side’ of entrepreneurship, there are more negative aspects we should consider as well. To add to the research into the positive attributes and economic benefits of entrepreneurship, the image of entrepreneurship as a positive one, the media attention and social media imaging only shows a particular, idealised version of being an entrepreneur.
The image portrayed on social media often shows us wealth, flexibility, fame, enjoyment of the high social status and choice in how the entrepreneur fills in their time.
Foundational research by Kets de Vries (1985) first highlighted the dark side of entrepreneurship, including the negative aspects of the following five (5) typical entrepreneurial characteristics:
- Autonomy
- Passion
- Capability
- Positivity
- Risk-taking.
Working autonomously! Or an inability to work together?
While entrepreneurs may be motivated by the ability to work independently, research shows that the motivation for starting a business could also lie in the fact that entrepreneurs are not good employees. They may not be able to listen well nor take orders or directions.
This inability to work well collaboratively and understand positive dynamics within a team, especially when giving direction, may be harmful as the organisation grows. As the entrepreneurial venture grows and the role of the entrepreneur shifts towards needing to manage their team, they may not be able to offer the leadership needed (Kets de Vries 1985).
Passionate! Or obsessive
While passion is an aspect that lies at the core of the entrepreneurial mindset, this can also be amplified and turned into an obsession (Kets de Vries 1985). Entrepreneurs may become obsessed with their desire for success or they may sacrifice everything else to pursue the vision for their venture. There are numerous examples of entrepreneurs who have made sacrifices that impact their own well-being and impact those around them (such as friends, family and business partners).
This obsession may drive entrepreneurs into poor decision making. It could result in an inability to step back from a failing venture, instead; sinking more time, money and resources into something without recognising the need to change course or admit that their efforts are unlikely to succeed (at least not on this occasion).
Extremely capable! Or distrusting of others?
The ability to do many different things is valuable to any entrepreneur because they often need to wear multiple hats within an organisation (and these may change as the venture grows and evolves). There is also a need to stay ahead of competitors and constantly gauge the market for potential changes or threats to the entrepreneur’s venture(s). However, the continual scanning of their environment for threats and the need to predict future scenarios and act on these before others are aware of these new developments may result in a distrusting state (Frederiks et al. 2019). This distrust may develop into paranoid tendencies, distorted logic, poor responses and a honing in on trivial matters. It may also be damaging to the entrepreneurs’ relationships with others.
Positive attitude! Or unrealistic optimism?
An optimistic attitude drives entrepreneurs to believe in their ventures and their ability to succeed and motivate themselves through the hard work and commitment required in challenging times. However, this can grow into unrealistic optimism (Frederiks et al. 2019).
The entrepreneur’s optimism is useful and drives a belief in the venture even when others criticise or question the entrepreneur’s efforts. Likewise, when the support of others is needed, the entrepreneur’s enthusiasm can be infectious and motivate others to contribute to becoming part of the business.
In the extreme though, this unwavering optimism can lead to an unrealistic assessment of the risks or likelihood for success. This self-deceptive state may lead the entrepreneur to dismiss warning signs and only look at reports and analyse observations through their own positive lens and misinterpret reality (Frederiks et al. 2019). This may lead to a sense that somehow everything will turn out all right and cause the entrepreneur to ignore problems until it is too late.
Calculated risk-takers! Or reckless?
Entrepreneurship is associated with uncertainty in terms of income, success and the continuity of resources, work, and stability (Frederiks et al. 2019; Shepherd & Patzelt 2015; Norton & Moore 2002). However, this may be another area where too much uncertainty or a growing belief in one’s own abilities can create excessive stress or lead to reckless behaviours.
What risks do entrepreneurs face?
Frederiks et al. (2019) indicate that there are four (4) typical types of risks that entrepreneurs face, these are:
- Monetary or financial risk
- Career risk
- Social or family risk
- Psychological risk.
Monetary or financial risk
In addition to an unstable income that entrepreneurs can pay themselves, many new ventures require a personal investment to be made. Entrepreneurs either bankroll their adventures themselves or are required to be personally liable if their business fails. This means bankruptcy is a real risk that needs to be considered as part of the entrepreneurial journey.
Career risk
Many entrepreneurs quit their job in favour of pursuing their passion. However, there is a risk as to whether they will be able to re-integrate into their workforce should the venture fail or should their ambitions change.
Social or family risk
Entrepreneurship requires a considerable commitment in terms of time and energy. Often, an entrepreneur must make sacrifices and their social and family networks may suffer. A lack of commitment to family and friends often results in these relationships suffering or even breaking down.
Psychological risk
The psychological or mental burden is possibly the biggest factor and can negatively impact the well-being of the entrepreneur. Monetary loss can be recovered and family and friends may adapt. However, mental health problems such as depression, anxiety and burn-out are significant impacts.
Failure
Along with the many celebrated successes and achievements of entrepreneurship, there are also many failed attempts. Bolton and Thompson (2013) identify three (3) common types of failures, including:
- Entrepreneurs who behave in an opportunist manner but adopt a flawed strategy and fail to deliver on their promises.
- Inventors who may be accomplished at developing something new but lack the skills required to follow through and launch an entrepreneurial venture.
- Entrepreneurs as who are dishonest or whose behaviour or actions are controversial.
However, many entrepreneurs who make mistakes or whose ventures fail, come back more determined in future.
Entrepreneurial stress
The pressure associated with launching, developing, and growing a new venture; the risks that entrepreneurs must wear; and the discrepancies between expectations and their ability to meet the demands all contribute to entrepreneurial stress.
Similarities between criminals and entrepreneurs
In addition to entrepreneurs who have failed, we can also see some entrepreneurs who exhibit criminal behaviour. As a result, the perception of an entrepreneur is sometimes associated with rogue behaviour, scheming or disingenuous intentions (Frederiks et al. 2019).
Studies have compared the traits exhibited by successful criminals to the traits that lead to successful entrepreneurs and found that many of these traits are similar. Successful criminals were shown to have a strong motivation or desire for success, had highly specialised skills and were risk-takers willing to collaborate (McCarthy & Hagan 2001).
Interestingly, Edmondson (2009) and Smith (2009) identified that finding regular employment was difficult for criminals who had served their sentences. It was also found that entrepreneurship offered a pathway out of crime (Irankunda et al. 2020).
Knowledge check
Complete the following five (5) tasks. Click the arrows to navigate between the tasks.
Key takeouts
Congratulations, we made it to the end of the topic! Some key takeouts from Topic 8:
- Much of the research and social media attention focuses on the positive attributes and economic benefits of entrepreneurship and shows an idealised version of being an entrepreneur.
- Entrepreneurs may be poor at taking direction and following orders. This could negatively impact their ability to collaborate with others.
- Entrepreneurs may become obsessed with their desire for success or they may sacrifice everything else in pursuit of the vision for their venture.
- Entrepreneurial distrust may develop into paranoid tendencies, distorted logic and poor responses.
- Unrealistic optimism can lead to a distorted assessment of the risks or likelihood for success by entrepreneurs. This self-deceptive state may lead the entrepreneur to dismiss warning signs, only look at reports and analyse observations through their own positive lens and misinterpret reality.
- Too much uncertainty or a growing belief in the entrepreneur’s own abilities can create excessive stress or lead to reckless behaviours.
- Several types of risk may impact negatively on the entrepreneur’s wellbeing.
- Many of the traits and characteristics of a successful criminal are the same as a successful entrepreneur.
Welcome to your seminar for this topic. Your lecturer will start a video stream during your scheduled class time. You can access your scheduled class by clicking on ‘Live Sessions’ found within your navigation bar and locating the relevant day/class or by clicking on the following link and then clicking 'Join' to enter the class.
Click here to access your seminar.
The following learning tasks will be completed during the seminar with your lecturer. Should you be unable to attend, you will be able to watch the recording, which can be found via the following link or by navigating to the class through ‘Live Sessions’ via your navigation bar.
Click here to access the recording. (Please note: this will be available shortly after the live session has ended.)
In-seminar learning tasks
The in-seminar learning tasks identified below will be completed during the scheduled seminar. Your lecturer will guide you through these tasks. Click on each of the following headings to read more about the requirements for each of your in-seminar learning tasks.
In your breakout rooms, you will discuss the videos of Steve Jobs that you watched in pre-seminar learning task 1. Use the following questions to guide your discussion:
- What positive entrepreneurial traits can be identified?
- What do you think about the negative traits or criticisms identified?
As part of pre-seminar learning task 8, you researched one (1) dark aspect of entrepreneurship. Your lecturer will lead a discussion about these aspects. Be ready to share your findings and reflect on these in the seminar.
Welcome to your post-seminar learning task for this week. Please ensure you complete this after attending your scheduled seminar with your lecturer. Your lecturer will advise you if this is to be completed during your consultation session. Click on the following heading to read more about the requirement for your post-seminar learning task.
Assessment 3 – develop a draft for your reflective analysis. In line with this week’s topic, consider which of the negative aspects discussed you might struggle with as an entrepreneur?
Develop specific questions to ask your lecturer during the consultation session and be prepared to discuss your approach to the assessment.
Each week you will have a consultation session, which will be facilitated by your lecturer. You can join in and work with your peers on activities relating to this subject. These session times and activities will be communicated to you by your lecturer each week. Your lecturer will start a video stream during your scheduled class time. You can access your scheduled class by clicking on ‘Live Sessions’ found within your navigation bar and locating the relevant day/class or by clicking on the following link and then clicking 'Join' to enter the class.
Click here to access your consultation session.
Should you be unable to attend, you will be able to watch the recording, which can be found via the following link or by navigating to the class through ‘Live Sessions’ via your navigation bar.
Click here to access the recording. (Please note: this will be available shortly after the live session has ended.)
The following additional resources can be used to extend your understanding of this topic:
- Jd R 2011, Steve Jobs one last thing, streaming video, YouTube.
- Shepherd, DA 2019 ‘Researching the dark side, downside, and destructive side of entrepreneurship: It is the compassionate thing to do!’, Academy of Management Discoveries, 5(3):217-220.
References
- Angel, B 2019, How this entrepreneur overcame depression, streaming video, the Entrepreneur, https://www.entrepreneur.com/video/331410
- Bolton, B & Thompson, J 2013, Entrepreneurs: talent, temperament and opportunity, Routledge.
- Carmichael, E 2015, The real genius of Steve Jobs (this made him exceptional), streaming video, YouTube, https://www.youtube.com/watch?app=desktop&v=rQKis2Cfpeo&ab_channel=EvanCarmichael
- Edmondson, V 2009, ‘A new business: Redirecting black youth from the illegal economy,’ Reclaiming Children and Youth, 18(3):16.
- Frederiks, AJ, Englis, BG, Ehrenhard, ML & Groen, AJ 2019, ‘Entrepreneurial cognition and the quality of new venture ideas: An experimental approach to comparing future-oriented cognitive processes,’ Journal of business venturing, 34(2):327-347.
- GaryVee TV 2019, Why being an entrepreneur is lonely, streaming video, YouTube, https://youtu.be/bs-fzhB5P6A
- Hembry, Z 2012, Steve Jobs – inspirational speech; "If today were the last day of my life", streaming video YouTube, https://www.youtube.com/watch?v=a5SMyfbWYyE
- Houlfort, N, Fernet, C, Vallerand, RJ, Laframboise, A, Guay, F & Koestner, R 2015, ‘The role of passion for work and need satisfaction in psychological adjustment to retirement’, Journal of Vocational Behavior, 88:84-94.
- Irankunda, A, Price, GN, Uzamere, NE & Williams, MJ 2020, ‘Ex-incarceree/ convict status: Beneficial for self-employment and entrepreneurship?’, The American Economist, 65(1):144-162.
- Kets de Vries, MFR 1985, ‘The dark side of entrepreneurship’ University of Illinois at Urbana-Champaign's Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship.
- McCarthy, B & Hagan, J 2001, ‘When crime pays: capital, competence, and criminal success,’ Social forces, 79(3);1035-1060.
- Norton, WI & Moore, WT 2002, ‘Entrepreneurial risk: have we been asking the wrong question?’ Small Business Economics, 18:281-287.
- Ragni 2010, Steve Jobs talks about managing people, streaming video, YouTube, https://www.youtube.com/watch?v=f60dheI4ARg
- Real MFs 2020, The dark side of entrepreneurship – eye opening video, streaming video, YouTube, https://www.youtube.com/watch?v=Zq0c9TbCyTc
- Shepherd, DA & Patzelt, H 2015, ‘The “heart” of entrepreneurship: The impact of entrepreneurial action on health and health on entrepreneurial action’, Journal of Business Venturing Insights, 4:22-29.
- Smith, R 2009, ‘Entrepreneurship: A divergent pathway out of crime,’ in Jaishankar, K (ed.), International perspectives on crime and justice, pp. 162-184, Cambridge Scholars.
- Top Trending 2015, 10 Things you didn’t know about Steve Jobs, streaming video, YouTube, https://www.youtube.com/watch?app=desktop&v=A5ughsPP2S4&ab_channel=TopTrending
