In a recent article I explored some of the unique challenges facing female entrepreneurs who continue to battle explicit and implicit discrimination over and above the existing challenges of running a startup.

The article highlighted the tremendous benefit society can derive if male and female entrepreneurship rates were equalized, and indeed the World Bank attempted to assist that when it launched a $1 billion fund back in 2017 to increase the number of businesses created and run by women.

New research was undertaken in association with the World Bank to test the most effective means of training entrepreneurs. The training revolved around something known as ‘personal initiative’, which was developed by Michael Frese and aims to furnish the kind of behaviors typically associated with an entrepreneurial mindset.

New research explores just how effective such training is.  The researchers conducted a randomized control trial on around 1,500 entrepreneurs, with 500 given traditional entrepreneurship training, 500 training based upon personal initiative, and 500 acting as a control group. Each of the entrepreneurs was tracked for two years after the 12 week program to see how they progressed as entrepreneurs.

The results were significant, especially for the female entrepreneurs in the study, as those who had been in the personal initiative training cohort achieved 17% sales growth and 30% increase in their company’s profits. This compared to a growth of just 11% for those in the traditional education group. These gains were even greater for female entrepreneurs, who saw a 40% increase in their profits after the personal initiative training, versus just 5% for those in the traditional training group.

Empowering women

The researchers believe that this form of training empowers entrepreneurs to become self-starters who are not afraid of failure. For instance, in the training, participants were instructed to show initiative when setting goals for their venture, with the training supporting them in this process.

Another element of the training was the development of the much fabled quality of grit and persistence, which has taken on hallowed qualities since Angela Duckworth brought it to mass attention.

Both the traditional training and the personal initiative training seemed to affect the tactical behavior of the entrepreneurs, with improvements in areas such as marketing and employee management. Interestingly however, this is despite personal initiative training not specifically addressing either of these areas. Despite this, the entrepreneurs who appear to have taught themselves scored slightly higher on both areas than those who had received specific training in them.

What’s more, the entrepreneurs in the personal initiative group also appeared to be more innovative, and were able to produce more new products, with greater diversity in their product lines.

It’s an improvement that the researchers believe is largely due to a shift in mindset rather than specific knowledge or tools.  It’s a shift that opens them up to new opportunities and ideas, with mentors then able to build on this and help the entrepreneurs learn from their journey to date.

Smarter mentoring

This in itself marks a shift from traditional mentoring that is instructional in nature, and requires a more inquisitive approach that prompts the entrepreneurs to do more reflecting on their behaviors and the results they achieved.

The authors believe that this approach works so well for female entrepreneurs because of the social role women often adopt.  They draw comparisons with social role theory, which posits that women are traditionally seen as more caring than men, who are often seen as more daring and adventurous.  These are often stereotypes that are internalized at both the individual and collective levels.

By throwing the female entrepreneurs into the deep end, the researchers argue that it forced them to break out of these stereotyped boxes and helped them to realize that they’re just as capable of taking risks as men.  It reminded them of their resilience against setbacks and creativity in solving problems and helped to develop a real passion for entrepreneurship.

Teaching entrepreneurship

Of course, this is far from the first attempt to examine the best way of teaching entrepreneurship.  Indeed, research from Aston University found no discernible difference in tuition that adopts a learning by doing approach and those that adopt a more textbook driven style.

“Entrepreneurship education is seen as a major force capable of generating long-term socio-economic changes through developing entrepreneurial, creative, flexible and wise individuals. There is an ongoing shift towards experiential learning in business schools, yet there is little empirical evidence to suggest this approach has better impact than traditional learning,” the author says.  “This study has shown, contrary to our expectations that ‘learning-by-doing’ approaches do not necessarily lead to better outcomes for students, and were even found to have adverse effects in some instances.”

Chiming with the earlier study however, they also found that attitude was a key factor in successful entrepreneurship, and was arguably more important than skills or knowledge.

“The findings surrounding the attitudes of successful graduates tend to characterise entrepreneurs: a high level of creativity and self-confidence, strong passion towards entrepreneurship, and tolerance to failure,” they say.

If such an attitude-driven approach can also help to break us free from stereotypes then it has a wide range of advantages, and may go some way towards securing the entrepreneurship premium the World Bank are striving for.