Entrepreneurship is received as a set of mindsets and habits an entrepreneur is developing and performing rather than single characteristics that uniquely identify someone as an entrepreneur. Still, some characteristics indicate the degree of entrepreneurial thinking which depends on your identity and development of self-awareness.
According to Maslow’s hierarchy of needs (Link), self-esteem is the second-highest need for self-actualization. Respect, status, recognition, and strength are characteristics entrepreneurs are seeking and they identify themselves as being valued for these.
Private Identity vs. Public Identity vs. Entrepreneurial Identity
As mentioned above, personal development affects entrepreneurial thinking. From a psychological point of view, our identity is comprised of two identities — a personal one and a public one. While private identity is difficult for externals to observe, the entrepreneurial identity also makes up the public self. The private identity consists of characteristics like thoughts, feelings, and fantasies that people do not necessarily want to share with their community, partners, or customers. Knowing the thoughts and feelings of a person is difficult and therefore it is rather guessing a person’s inner thinking. The entrepreneurial identity is about what entrepreneurs are sharing publicly which is also part of their private identity. Typically, this includes characteristics that you can see and observe like personal appearance, style, and personality.
How does the private, public, and entrepreneurial identity work together from a practical point of view? There is a strong relationship between public and entrepreneurial identity as the characteristics that you share in public will also define your entrepreneurial identity. For example, an open and friendly family person will most likely be perceived as an entrepreneur for managing a family’s and personal needs. For being top-of-the-world entrepreneurs it is even wanted to communicate private thoughts and fantasies to be counted in as visionary and innovative. Nowadays, entrepreneurs share a lot of their private life via social media and make it hard to distinguish between their private and entrepreneurial selves. Sharing visions unites people with similar believes and supports business trends.
Knowing about the interaction between private, public, and entrepreneurial identity we now want to drill deeper into the characteristics and experiences that define an entrepreneurial self. Take the following aspects into consideration and recap them for yourself:
- What entrepreneurial experience do I have? Experience helps entrepreneurs to better evaluate risks and rely on a bigger network of partners.
- What appearance do I have? Adapting your wearing and behavior to your business and your needs will grant you better social interaction as personal judgment is always present.
- What power do I have and how do people perceive it? Power is very diverse but can be expressed by dominance, money, and status. Showing too much power may intimidate the opposite or help you to make your point — it is hard to tell upfront.
- What are my abilities and my current performance? Entrepreneurs measure themselves by abilities and performance. Some performance indicators may help to compare performance but after all, it should be a realistic self-assessment to value your actions as an entrepreneur.
- What is my morale? Having standards and rules for taking decisions is admirable but morale is rather subjective. Feeling good about your morale will help you to handle rationally.
- How am I socially accepted? Being socially accepted can be achieved by being respected by others. A lot of business opportunities emerge from hobbies and private social interactions.
The characteristics above are some good sources for self-esteem as mentioned by Maslow. Working on the sources will help entrepreneurs to value themselves.
Types of Entrepreneurs
There are several types of entrepreneurs that can be perceived by entrepreneurial identities. Per Berk (Link) the following entrepreneurs shall be listed:
- Action taker
- Traction gainer
The perceiver does not identify himself as an entrepreneur as he has a very specific focus and is uncertain of his role as an entrepreneur. Having a lot of ideas, he does not know where to start and lacks awareness of a proper business strategy. In contrast to the perceiver, the action taker is a careful thinker that learns to trust the decisions he is doing. Acting according to set rules let him make his decisions less subjective. The traction gainer has already gained a lot of confidence in making his own decisions and therefore refuses to delegate tasks. Desiring to do any job and role himself yields the risk to over-identify himself with his initiative. In opposite, the sustainer is open to feedback and self-knowledge having always the broader picture in mind. With a good network of partners and properly considering the factor time when taking actions, he tends to do business the most effective way. The strategist is open to learn and think on an even longer timeframe being ahead of the competition for 5 to 10 years. Desiring more thrill, he takes higher risks, and being in the business for a great time he takes success for granted.
The evolvement of entrepreneurs according to the above types is a process that is going back and forth and is always related to the specific business domain you are in right now. Entrepreneurial identity is flexible and changes with experience and age. My own goal would be to reach the sustainer type as smoothly as possible not being too self-aware to admit risks and managing my business objectively.
Build your Entrepreneurial Identity
Here are some best practices for building your entrepreneurial identity:
- Building your entrepreneurial identity is a journey: Take small steps and do not over-estimate yourself whether in the beginning nor at a later stage. It is a much higher effort to make things right than considering the risk from day one.
- Test how much risk you are comfortable with: Similar to financial investment, entrepreneurs do have different comfort zones for taking the risk. While you are young and flexible you can still take a high risk but with progressing age and responsibility, your entrepreneurial decisions should be containable.
- Experience, experience, experience: With practical experience, you can easily estimate the risk of decisions. When you have explored a successful business strategy do not stop applying expertise from other engagements and entrepreneurs.
- Take mentoring sessions: Entrepreneurs learn the best from other entrepreneurs and their success/failure. Do not hesitate in exchanging information with a mentor.
- Develop a recognition feature that will make you recognizable as an entrepreneur: For example, find yourself a unique tie or glasses which is memorizable and for which you can tell a fascinating story.
- Test your identity with your friends and family: They will provide honest feedback knowing your history and personal information.
Entrepreneurship means showing personality and therefore the above list is only a subset of best practices that you should take into consideration.
Conclusion and Final Thoughts
Entrepreneurial identity is a subset of characteristics from a person’s public and private identity. Being an entrepreneur is not a binary yes/no decision rather people can have or have not an advanced degree of entrepreneurial thinking. Entrepreneurs are permanently evolving with their experience and understanding. Best practices for building an entrepreneurial identity help to strengthen your identity.
The following material provides further information on how to build your entrepreneurial identity:
Entrepreneurial Identity and Identity Work (Link)
Entrepreneurial identity is a complex construct with individual and organizational influences. Entrepreneurial Identity and Identity Work highlights the process of forming an entrepreneurial identity and shows the effect of different life episodes on this identity.
Entrepreneurial Identity (Link)
Duening and Metzger describe how aspiring entrepreneurs can construct an entrepreneurial identity. They distinguish identity issues into a macro-and micro-level and provide a theoretical background for those entrepreneurs who want to tackle the challenges of developing an entrepreneurial identity.