Kelly Smith Coventry University Philip Ely What is a delusional entrepreneur A potential working definition A nascent entrepreneur who pursues a product service or business idea singlemindedly ignoring the realistic and pragmatic signs and advice that their ventures will fail ID: 620827
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Slide1
Understanding ‘delusional entrepreneurs’ and how we educate them
Kelly
Smith, Coventry University
Philip ElySlide2
What is a “delusional entrepreneur” A potential working definition
A nascent entrepreneur
who
pursues
a product, service or business idea single-mindedly, ignoring the realistic and pragmatic signs and advice that their ventures will failSlide3
Is this a problem?
Whilst product or business failure itself does not need to be seen to be a negative outcome,
an entrepreneurs
’ over-optimism, over-confidence, hubris and narcissism
could be a
major inhibitor to them learning from these failuresSlide4
“And
a vision appeared unto them of a great profit: evidence of self-deception among the
self-employed”
Evidence
is presented that the self-employed expect better financial outcomes than do employees but experience worse realisations. This is consistent with theories that entrepreneurship is driven by unrealistic optimism
.
Arabsheibani
at al., (2000) Economic Letters. 67, 35-41
Slide5
Example #1 - Jude
Innovative type of photography
Needed expensive equipment
Refused advice to explore prices that customers
would actually pay or to do any financial planning
Went to a talk by Richard Branson and reported back that he said if you follow your passion, the money will flowSlide6
Example #2 - Jake
Had a idea for an innovative new type of headphone that needed a complex technical solution
‘Knew’ it would work because ‘all his friends and everyone he spoke to’ thought it was a good idea
Had no technical expertise but had a friend who ‘could do CAD’Slide7
Example #3 - Jessie
Had a simple idea that solved a common problem
Came over as confident and competent and able to deliver
Business and financial planning were very superficial despite prompting
I
dea and personality drew in investment but lack of planning and grasp of real costs affected actual income levelsSlide8
Potential outcomes for entrepreneur?
Slower than necessary business growth
Loss of self-confidence or self-belief
Financial loss for self and others
Business
failure
Educational impact
Learns ‘on the job’
Seeks advice when realises needs help
Proves advisors wrong
Succeeds regardlessSlide9
Potential outcomes for educator?
Watching as an individual fails
Picking up the pieces
Reputational issues
Impact on own self-confidence and self-belief
Potential that others will follow
Opportunity for learning and development of practiceSlide10
Create your own examples…
In table groups
Create a scenario from your own experience
Discuss
How often have you seen this behaviour?
How disruptive was it for you as an educator?
How did you overcome the issue, or what would you try next?
Report back to the room in 15 minutes!Slide11
Next Steps…
First stage of exploring if educators think the ‘delusional entrepreneur’ is a problem for entrepreneurs and/or for their own practice
If this workshop suggests that it is a problem, more work will be done on a methodology to collect experiences of educators
This will be used to develop a scale for use with nascent entrepreneurs to further explore delusional attributes and their positive and negative outcomesSlide12
Thank you for your help
Kelly Smith
International Centre for Transformational Entrepreneurship, Coventry University
aa7645@coventry.ac.uk
@
kellyjs