The internet is full of thoughtful advice on how to raise your kids to become entrepreneurs.
From encouraging them to play sports and embrace luck to modeling problem solving and cultivating confidence, many of these tips sound like they’re worth a shot. But according to an in-depth recent article in the Financial Times, perhaps the simplest way to encourage your kids towards entrepreneurship is to be an entrepreneur yourself.
The Power of Role Models
"A range of academic research indicates that parental entrepreneurship plays a critical role in determining whether offspring become entrepreneurs themselves," writes Jonathan Moules. "A study in Sweden by Mirjam van Praag of Amsterdam School of Economics last year found that having entrepreneur parents increased the probability of someone setting up a business by about 60 percent."
The Kauffman Foundation has apparently came to a similar conclusion based on a 2010 survey of 5,000 Americans. It found that half of those who knew an entrepreneur personally had either started a company or were planning to do so.
Through several case studies, the article also looks at the cons of having a founder in the family, noting that having entrepreneur parent can make it easy for a child to join the family business rather than start their own. "In many cases I’ve seen that the founder-entrepreneur has placed his son in a comfortable position in his company.” said the son of one family that has owned a coffee business for several generations. “Since you are not pushed, you do not train your brain to think in a creative way which is absolutely essential for an entrepreneur."
The Power of Character and Context
Of course, no one is saying that having strong entrepreneurial role models is the single determining factor in who will become an entrepreneur. What else matters? Character clearly. Whether it comes mostly from nature or nurture, a certain comfort with risk and ambiguity is probably also strongly predictive of who will start a business.
Larger economic and social trends could also lay a role. Gen Y has again and again been called a generation of entrepreneurs. Pundits offer various explanations for this including a certain hyper-involved, highly protective parenting style that many relatively well off members of the cohort grew up with, as well as the lack of much to rebel against in their peaceful and prosperous childhood years (how the nasty shock of the Great Recession will ultimately impact Gen Y remains an open question.) High-profile start-up successes like Mark Zuckerberg could also be encouraging more young people to dream entrepreneurial dreams, as could the changing demands of an insecure job market.
What does this all boil down to? Creating entrepreneurs is a complicated and elusive business that involves inherent traits, parenting style and the influence of the larger cultural context, but as the Financial Times article makes clear having strong role models in your parents is certainly a huge help.
In your experience, are the children of entrepreneurs more likely to go into business themselves?