Not All Entrepreneurs Are Alike

Here's a diagnostic tool you can use.

Posted Feb 01, 2018

Entrepreneurs are the drivers of growth in the U.S. economy.

According to a 2016 Ernst & Young survey, 59 percent of entrepreneurs planned to increase workforces compared with 29 percent of large companies. More than large companies, entrepreneurs are the drive behind innovation and the creation of new industries (Weinberger, 2016).

There is a strong probability that you may be working for one or investing in one in your future.

In this article we will focus on examining different entrepreneurial types plus providing a way to diagnose what type of entrepreneur you are dealing with.

Not All Entrepreneurs are the Same:

Chris Kuenne and John Danner caution that not all entrepreneurs have similar personalities. Kuenne is a Lecturer at Princeton University and Danner is Senior Fellow at the Lester Center for Entrepreneurship at the University of California at Berkley’s Haas School of Business. They have written a book about entrepreneurial personality (2017).

In their view, “personality is the central tendency by which business is built. Certain personalities do follow a path of destiny.” 

Their view: understand these personality types and you can make more informed career and investment decisions.

The four personality types they define are Drivers, Explorers, Crusaders, and Captains.

Drivers:

Steve Jobs is the prototype for this type of person. Drivers see themselves as destined. Like Jobs, these Drivers see opportunities before others do. And they have the self-confidence to seize that opportunity.

Another Driver is Steve Brightman:

At age 19 he figured out that he could make money installing coin operated washing machines and dryers in apartment buildings around New York City.  Today his company owns 45,000 machines.

It is exciting to be around Drivers. Their enthusiasm can be infectious. Drivers are on a mission. The problem for employees is that Drivers like to be the genius surrounded by hundreds of helpers. Drivers do not create robust teams that can perform independent of the Driver.

As long as the Driver perceives you as carrying out the Driver's wishes, you will be employed. But the Driver can suddenly turn on you. Employees are always fearful of being caught “off balance” and fired.

Driver traits limit the ability of a company to grow and can create frustration for employees who value freedom to “take the ball and run with it.”

Employees spend more time asking, “What does the Driver wish to hear?” rather than “What does the Driver need to know?”

Steve Jobs grew a remarkable world class organization at Apple as a Driver. But his time as CEO of Pixar changed his outlook towards focusing on having viable, stable teams. Learning he had cancer also pushed him into making Apple less Jobs-centric. 

How Can You Spot a Driver?

Using LinkedIn or your college alumni online data base, can you find former employees who worked at the Driver’s company? Ask them this question:

“On a scale of 0 (never) to 10 (always), how often did you have to think what would please the boss or avoid the boss’ displeasure?  Please explain your answer.” 

If the boss is a Driver, the scores will usually be in the 8-10 range since everything in the company revolves around the Driver.

In talking with former employees, ask this question:

“On a scale of 0 (never) to 10 (always) to what degree does this person look at employees as either useful to help achieve the goals OR roadblocks that must be eliminated. There is no middle ground. Please explain your answer.” If the boss is a Driver, the scores will usually be in the 8-10 range.

Explorers:

Drivers are driven by a solution they see and nobody else sees it as well as they do. The Explorer entrepreneur starts an organization because of a fascination with a complex problem that nobody has yet been able to solve. 

Mark Zuckerberg of Facebook is an Explorer. Bill Gates may have been a Driver when he was at Microsoft but he is an Explorer at the Bill and Melinda Gates Foundation.   

Explorers’ great strength is that once they focus on a complex problem, they never give up. Their great weakness is that once they have a workable solution, they begin to lose interest. They are drawn to the next complex problem to be solved. 

This fascination with novelty can harm a business that seeks to scale-up. Scale-up requires routine, predictability, and standardization. That is so boring for Explorers!

Consider the example of Edwin Land.

Edwin Land was founder of a chemical based process to make instant photography available at the consumer level. Once the Polaroid Camera became popular, he should have been promoted to head an R&D Center to come up with the next great idea. Eventually he was given such a role. But until he was “kicked upstairs,” he kept the company focused on solving complex chemical problems involving photography.  He totally missed the consumer video revolution.

Explorers are dangerous when they hire people like themselves: technically solid and intellectually curious. As a company scales up, such curious people can stifle growth.

How Can You Spot an Explorer?

Talk with former employees and ask this question:

“On a scale of 0 (never) to 10 (always) how often does the founder hire people who are similar to him/herself?  Please explain your answer.”  For Explorers, expect a score of 7 or higher.

Crusaders:

Many nonprofits are founded by social entrepreneurs who are driven by a mission rather than a business problem or a belief in one’s greatness. 

Ben and Jerry’s Ice Cream is today a division of a large consumer product company.  But it was founded by two Vermont entrepreneurs as a vehicle for their social activism.

Like Explorers, they like to hire people similar to them. 

Angelo Pizzagalli built one of Vermont’s largest construction companies.  He said he hired people whom he wanted to have breakfast with. That works when the firm is small, but it does not make for a great way to scale-up. 

Crusaders can be extraordinary as the public face of the organization. Like Drivers they can inspire others. 

And like Drivers they may manage so that things are swirling around them at all times. They are bad at developing independent teams and giving them autonomy.

Crusaders complain that employees won’t seize the opportunities that Crusaders won’t give them.

In the end, the organization needs a strong Board of Directors to force Crusaders to hire people the Crusader is not comfortable with. But Crusaders prefer to work with Boards that do not challenge the Crusader.

Growing a business requires people who may be less mission-driven and more results-oriented.

Crusaders and Drivers are so similar, that the questions we suggest for Drivers also apply to Crusaders.

Captains:

Captains often become entrepreneurs because they “fell” into it or seized an opportunity that happened to come their way. Their stories contain an element of chance rather than fierce drive.

Captains tend to see themselves as managing through “we” rather than “me.”  They want to have other people’s fingerprints on the strategies and decisions.  For them, part of the fun of leadership is creating a great team.

Margery Krasue is the founder of Los Angeles based APCO, the second largest privately-owned public relations firm in the world. She takes little credit for her success and gives credit to the teams she creates.

Captains are great at improvisation and that is their great strength. They can quickly adapt to changing circumstances. 

How Can You Spot a Captain?

Captains can be great at scaling-up their ventures. A weakness for Captains is that they lose firsthand feel for what is happening on the frontlines. They may put too much trust in autonomous teams. 

Talk with former employees and ask this question:

“On a scale of 0 (never) to 10 (always) how often do you have to think what would please the founder or avoid the founder’s displeasure. Please explain.”  With Captains, the answer might be 6 or less.

Talk with former employees and ask this question:

“On a scale of 0 (never) to 10 (always) to what degree does this person look at employees as either useful to help achieve the goals OR roadblocks that must be eliminated.  There is no middle ground. Please explain your answer.”  If the boss is a Captain, the scores will be 6 or lower.

Talk with former employees and ask this question:

 “On a scale of 0 (never) to 10 (always) how often does the founder hire people who are similar to him/herself? Please explain your answer.” For Captains, expect a score of 6 or less.

Conclusions:

Kuenne and Danner use the term “personality” to explain entrepreneurial behavior.  While their diagnostic system has value, real “personality” is relatively enduring.  And the behaviors that the authors describe can change over time. We prefer to think that the authors are discussing core behaviors. And core behaviors can change.

As mentioned earlier Steve Jobs may have been the classic Driver when he founded Apple, but his later experience as the head of Pixar made him more appreciative of independent teams. Bill Gates may have started Microsoft as a Driver but that is not how he leads the Bill & Melinda Gates Foundation. 

If you wish to use our diagnostic questions, try to find at least five former employees and ask each the same questions. Never take any response by one employee seriously. You want to examine trends in the responses to your question.

If you can arrange a face-to-face meeting with former employees that is going to lead to better results than a phone discussion.  References have a legitimate concern about how confidential you will treat their comments. A face-to-face meeting helps deal with these concerns as long as you stress confidentiality.

At face-to-face meetings, you also have the additional information of body language to help you evaluate the value of what is being said. 

Each entrepreneurial type tends to start a company around one organizing principle. For Drivers, that organizing principle is a product they believe in. For Explorers, it is a complex problem that fascinates them.  For Crusaders it is a noble mission. For Captains it is the joy of working with great people. 

Our experience in working with entrepreneurs points to the value of entrepreneurs going into business with stong business partners who can counterbalance their strengths. Steve Jobs had Steve Wozniak; in founding Microsoft, Bill Gates had Paul Allen. In founding the Bill Gates Foundation, he partnered with Melinda Gates. 

Edwin Land (Polaroid), Ken Olsen (Digital Equipment Corporation), and An Wang (Wang Labs) all were strong entrepreneurs lacking a true partner that was an equal. 

All of these founder-led companies once dominated their niches. And none exist today.

References

C. Kuenne & J. Danner. BUILT FOR GROWTH: HOW PERSONALITY SHAPES YOUR BUSINESS, YOUR TEAM, AND YOUR ABILITY TO WIN. (2017) Boston: Harvard Business Review Press.

M. Weinbereger. “Why Entrepreneurs are Essential to the Global Economy.” FINANCIAL TIMES. (2016). https://www.ft.com/content/c1d2736c-1cdc-11e6-a7bc-ee846770ec15