Periodic Reporting for period 1 - PosEnt (Positive Entrepreneurship)
Reporting period: 2018-09-17 to 2020-09-16
PosEnt examined the well-being of entrepreneurs as an important resource for their success. Entrepreneurs’ well-being fuels their creativity, innovation, persistence and firm performance. Entrepreneurs’ well-being also impacts their life partners. Ultimately entrepreneurs’ who feel well are more likely to contribute positively to the welfare of the economy and society.
PosEnt sought to understand entrepreneurs’ well-being in its different facets and to chart its key drivers. We investigated both entrepreneurs’ hedonic (‘feeling well’) and eudaimonic (‘doing well’, optimal functioning) well-being and charted drivers of well-being related to the nature of entrepreneurs’ business, their work and home-context over time. Multiple studies examined sources of the day-to-day well-being of entrepreneurs, traced their well-being in response to the Covid-19 pandemic in a longitudinal study, as well as in a large cross-country comparative study.
The Covid-19 pandemic impacted entrepreneurs in unprecedented ways. They worried about their and their families’ health, dealt with uncertainty related to lockdowns, and faced difficulties to keep their businesses afloat. This created high levels of stress, but also triggered reactions such as pivoting of business plans and recognition of new opportunities generated by the pandemic. Through the research we sought to support entrepreneurs in this time of crisis.
First, drawing on GEM, we found that the well-being of necessity entrepreneurs (those, who are ‘pushed’ into running a business) is enhanced particularly by experiencing work as meaningful. Autonomy is a source of well-being for those entrepreneurs who start their business to exploit an opportunity (opportunity entrepreneurs). We also established that the relational aspects of national culture (socially supportive culture and kindness) enhance especially necessity entrepreneurs’ well-being. Conversely, the ‘individualistic’ aspects of culture (curiosity) enhance the well-being of opportunity entrepreneurs.
Second, drawing on our own global dataset we document the effect of the pandemic and government response on entrepreneurs’ well-being and businesses. We distill more general insights on how crises impact entrepreneurs’ well-being, and shed light on what entrepreneurs can do in a crisis to protect their well-being. More severe government responses to the pandemic (lockdowns) had a more pronounced negative impact on entrepreneurs’ business and wellbeing. Our findings indicate that entrepreneurs’ agility – a type of pivoting during crisis - can be a double-edged sword for well-being, while confirming positive effects on growth aspirations. The positive effects on well-being come mostly from recognizing new opportunities. Changes to planning can negatively affect well-being; likely because they are insufficient to reassert a sense of control in a crisis like the Covid-19 pandemic.
Third, our longitudinal research highlights the significance of eudaimonic well-being and its protective role for weathering crises. Entrepreneurs’ pre-pandemic eudaimonic well-being positively predicted their subjective vitality and creativity during the pandemic. Moreover, it mitigated the negative impact of crisis-related uncertainty on creativity. Thus, eudaimonic well-being helps to understand how entrepreneurs can navigate crises with vitality and creativity despite facing significant uncertainty.
We disseminated the academic results of the project at 15 major conferences and through 4 academic papers. We translated the academic results into practical insight for entrepreneurs and policy makers and delivered 20 workshops and presentations to entrepreneurs, published 4 special reports and presented results at 7 events for policy makers. The findings informed policy makers (i.e. Economic Affairs Committee of UK House of Lords, Presidential Council for Entrepreneurship in Poland) and were widely covered in the media (e.g. BBC, The Guardian, Financial Times, Al Jazeera, WIRED).
To date, autonomy is seen as a main source of entrepreneurs’ well-being. Our research offers a more nuanced perspective on drivers of well-being of different types of entrepreneurs and shows that autonomy mainly benefits the well-being of opportunity entrepreneurs. By contrast, meaningfulness is a critical source of the well-being for necessity entrepreneurs.
Current research on well-being of entrepreneurs offers very little contextualization. We advance that research by offering evidence on how culture shapes entrepreneurs’ well-being and charting how opportunity and necessity entrepreneurs thrive in different cultural settings.
We use the COVID-19 pandemic as an opportunity to advance the understanding of entrepreneurs’ well-being in the context of crisis. The combination of adaptation of business plans and recognizing business opportunities allows entrepreneurs to reap well-being benefits and look into the future with optimism. We also offer new insights into how lockdown regulations – as newly devised formal institutions in response to the Covid-19 crisis – can constrain and enable pivoting and entrepreneurs’ well-being.
Although entrepreneurship is seen to have much potential for self-actualization and for well-being, the role of eudaimonic well-being and its’ consequences for entrepreneurs are only poorly understood. We introduce eudaimonic well-being as an important psychological capability that allows entrepreneurs to navigate crisis successfully (with vitality and creativity) which complements existing research that focuses on pre-crisis firm capabilities for effective crisis responses.
The prevalent view in the literature also treats entrepreneurs as ‘masters of the uncertainty’ who can adapt relatively easily to crises. We offer more nuanced perspective by showing that uncertainty weighs heavily and diminishes entrepreneurs’ subjective vitality and creativity.