Entrepreneurial Identity: A Leader’s Superpower and Their Achilles’ Heel?

The way entrepreneurs answer the question “Who am I?” — that is, their entrepreneurial identity or EI — plays an important role in how they think and act from new venture launch to harvest.1 For example, how they define their background, their purpose, and their values as founders can inform the type and scale of resources they gather, the structure and goals of their businesses, and even their propensity to persevere (or not) in the face of adversity.

Extrapolating from our recent review of the existing EI literature and our own ongoing work in this area, we suggest that it is important for organizational leaders, those of small and large organizations alike, to assess and refresh the ways in which they might identify as entrepreneurs at every stage of their enterprises. In doing so, we look to help leaders align their entrepreneurial identity with the challenges they might face at various points in the life of their organizations and understand how their EI may inform the ways they seek to grow and develop their businesses.

For the Early-Stage Organization: Take Stock of Who You Are

In the early stages of the life of an organization, when teams, processes, products, or services are being defined, EI serves the dual role of motivator and grounding resource. Because many start their ventures moved by the desire to express who they are, particularly early on, entrepreneurs make decisions that align with their EI. These decisions span product and service design, business location, hiring, and more.

For instance, a study of entrepreneurs in the sports equipment industry suggests that how entrepreneurs regard themselves shapes how they go about acquiring resources, including who they hire, what resources they pursue, and even their target market. The founder of an early-stage digital media company explained to us the central role that entrepreneurial identity plays in his hiring decisions, saying, “When we bring in someone new, it’s not just about their skills — it’s also about who they are and how that aligns with who we are becoming as an organization.” Our conversations with social entrepreneurs suggest comparable dynamics: Many of these founders start their organizations as a means of channeling their identities and values, such as the pursuit of prosocial goals. Consider Gary Hirshberg, cofounder of Stonyfield Farms.