Before I started my doctoral research to understand why people are more creative in startup companies, I had two questions: Are more creative people in startups? Or--Are people more creative in startups? Same words, two completely different questions. Initially, I assumed the answer to the first question is no. Being more or less creative has nothing to do with your preference for working in either type of company. As a result, my study focused on the second question: why would the same person be more creative in a startup company than in an established, mature, large company. Referring to research done before me, and my own two-year interview-based first-hand study, I found that people are, in fact, more creative in startup companies. To be able to test that hypothesis, all of my participants worked for both types of companies, and therefore were in a position to compare the two. Not all of them experienced higher levels of creativity in the startup companies. Some of them experienced higher creativity levels when they worked in corporate America, but for every single participant who felt more creative in the large company, there were six who were more creative in the startup company. This was true for several reasons, but this is not the focus of this article.

For years, I defended the position challenged by my first question. I didn't want to believe that mature companies attract less creative people, or that creative people were less drawn to work in large companies. But recently I decided to revisit that assumption.

Interviewing more people, I realized I was wrong. Creative people do go to work in startup companies more often, but not because they are creative. In fact, their willingness to work for startup companies and their creativity are both the results of yet a third factor: their willingness to assume risk.

People who assume risk are more creative.

The most creative employees are the ones who will defy their boss and try new things. When they fail, they are not demotivated, and are not afraid of their boss' reaction. They learn from failure, and make it better the next time. In fact, the willingness to try things and fail is what makes them creative. The willingness to assume risk is what drives their curiosity and desire for experimentation.

People who assume risk are willing to work in startups.

A startup company is not the safest place to work in. Startup failure rates are much higher than those of Fortune 500 companies. Not that Fortune 500 companies never fail, and not that they offer job security, but they are definitely safer than early stage startups. Employees who are risk-takers will be more willing to assume the risk associated with working in a startup, as they focus on the potential upside of success more than the downside of failure.

So it isn't that creative people go to work in startup companies because they are creative, nor working in a startup companies makes you more creative. It is the willingness to assume risk that makes you more creative, and gives you the preference for working in startups.

What does it mean for mature companies? If you want to hire creative employees--hire employees that worked in startups. Their willingness to assume the risk of working in the startup companies is what will make them willing to try things and be creative in your company. And once you hire them--let them try things and fail.