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Why entrepreneurs are an important asset to the global economy

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Is there a common characteristic successful entrepreneurs share that guarantee their success? This item was on the agenda in Ernst & Young's 2011 High-impact entrepreneurship global report, which reveals there are indeed certain personality traits shared.

According to Ernst & Young, high impact entrepreneurs (that is, those with estimated growth of more than 20 per cent per annum) are most likely to:

  • Have started their companies between the ages of 26 and 45.
  • Have college or graduate degrees.
  • Work in partnerships.
  • Conduct a significant proportion of their business internationally.
  • Have little fear of failure.
  • Start a business because they perceive an opportunity.
  • After achieving success, fund other ventures as angel investors (on average, US$90,000 capital invested in other ventures as angel investors).

And, according to the study, these high-growth entrepreneurs are an important asset to the global economy, expecting to add between three to 15 times more jobs than low-growth businesses.

“As a group, entrepreneurs represent the best hope of creating sustained economic growth around the world,” says Maria Pinelli, global vice-chair of strategic growth markets at Ernst & Young. “However, interestingly, the report shows that although there is a really important pool of entrepreneurs out there, only a minority have founded businesses that achieve an average 20 per cent or more estimated growth.

“To replicate this group of ‘super entrepreneurs’ there needs to be the right social culture and educational system from the beginning of their development to equip them with the right skills and behaviours to build sustainable, globally focused high-growth companies,” says Pinelli.

“In emerging markets, entrepreneurship has an important role in propelling future growth,” says Rhett Morris, director of Endeavor’s Center for High-Impact Entrepreneurship. “As these economies modernise and become more efficient, the best entrepreneurs will take advantage of new opportunities that arise in their own communities as well as those in other nations to lead the way in creating jobs and fostering economic growth in their countries.”

Published on: Friday, September 02, 2011

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