Getting Down to Business

Is there a genetic component to entrepreneurial success?

By | April 1, 2014

ANDRZEJ KRAUZEScott Shane, an economist at Case Western Reserve University who has been teaching entrepreneurship for 20 years, has heard it all when it comes to his undergraduates pitching ideas for new businesses. Some students put in extensive time and research to come up with a business proposal that flops when they try to express it as a convincing pitch. Others put in no effort and wing it after glancing over some information, but come up with a marvelous proposal. “It’s like an intuitive sense,” Shane says, “like they could see what the marketplace would want.”

In Shane’s field, business phenoms who so effortlessly produce innovative ideas and succeed at starting businesses are often referred to as “born entrepreneurs.” For years, Shane’s been interested in whether science could corroborate such a genetic endowment. So in 2008, he turned to a UK registry of several thousand twins to find out. Looking at eight measures related to entrepreneurship, such as the number of years self-employed and the number of businesses owned, Shane calculated that entrepreneurship was between 30 and 55 percent heritable (Management Science, 54:167-79, 2008). “That’s not trivial,” he says.

A year later, Zhen Zhang, now a management professor at Arizona State University, followed up with another twin study, but added a twist. Zhang looked at the sex of the participants from a different twin registry and found that, for men, genetics had nothing to do with their becoming an entrepreneur. For women, on the other hand, starting a business was 65 percent heritable (Organizational Behavior and Human Decision Processes, 110:93-107, 2009). Zhang interprets the findings as having to do with the extra hurdles women face in business. Among women, he speculates, “only those people who are really determined, who have that genetic makeup [to their advantage], emerge as entrepreneurs because of the hardship in the environment.” For men, the social supports in the business community might help overcome any genetic disadvantage, Zhang reasons.

It’s like an intuitive sense—like they could see what the marketplace would want.—­Scott Shane, Case Western Reserve University

So what genes might be at play in influencing business acumen? Shane and others have turned to genome-wide association studies (GWAS) to hunt for single nucleotide polymorphisms (SNPs) that might be involved. His group and another headed by Roy Thurik, an entrepreneurship researcher at the Erasmus School of Economics in Rotterdam, Netherlands, showed that the genes, not surprisingly, are difficult to pinpoint. In two separate GWAS studies, the groups identified a number of promising SNPs, none of which, considered in isolation, amounted to more than 1 percent of the variance (International Journal of Developmental Science, 6:127-35, 2012; PLOS ONE, 8:e60542, 2013).

Shane has also taken a different tack, digging into the psychology of entrepreneurs. Studies have shown that entrepreneurs are known to have a higher likelihood for certain traits, such as thrill seeking or extroversion. Some researchers have suggested that thrill seekers have dopamine transporters and receptors that make the feel-good neurotransmitter less available, Shane explains, thereby driving them to seek out extreme stimuli to get a rush. Perhaps dopamine could explain the attraction to the high-stakes world of startups.

In 2011, in a study of more than 1,300 twins, Shane and his colleagues found evidence for a polymorphism in a dopamine receptor gene—a so-called “candidate gene”—that was associated with entrepreneurship and could explain 0.5 percent of the likelihood of becoming an entrepreneur (Small Business Economics, 36:151–55, 2011). “This is a tiny amount of evidence . . . but it’s the first evidence of a specific gene,” Shane says.

The results suggest that our biology might contribute to a decision as important and complex as career choice. But the candidate-gene approach, which analyzes genes already thought to be involved in a particular trait, as opposed to the unbiased approach of GWAS, is outdated and unreliable, says Thurik. He believes that GWAS could offer answers, if the right phenotype is measured and the right data are used.

“To establish something of any significance you need an immense data set,” says Thurik, adding that no data sets currently contain the right scale and measurements to properly look for genes involved in starting businesses. Thurik concedes that his own GWAS study also measured the wrong outcome, entrepreneurship, and instead should measure the underlying psychology that drives people to start a business. That being said, “with the wrong measure and the wrong phenotype, we came so close” to identifying candidate genes.

Thurik has shown that it is possible through GWAS to get down to the genetics of complex behaviors or traits. Last year, he and his colleagues identified SNPs associated with educational attainment (Science, 340:1467-71, 2013). While the results don’t point to an education gene, they demonstrate the utility of GWAS in such applications. “This is just opening a door with no practical implication, and this now should convince scientists or people who finance [such research] to do it better.”

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Avatar of: wctopp


Posts: 110

April 15, 2014

Look at the fathers & mothers.  Good chance it's epigenetic.

Avatar of: kosimov


Posts: 1

April 17, 2014

I am a serial entrepreneur with a marginal success record, but that could be due to some health problems I inherited from my father. I have four sons and one daughter. My oldest son has had his own networking business for over ten years. My other children have dabbled in entrepreneurship while two of those have actively pursued it. Oh, forgot, my youngest son seemed to have no hesitancy to jump into his own business, so make that three out of five of my children. With the markets being so flat or even sinking, he had to give it up when he had his first child. He is planning to do it again (start a business AND have another baby!). Only two of them went to college, though I have a BSEE degree. They found school too boring or expensive since I could not help them when I was ill and off work. My daughter has the "e-bug", as I call it, which is that she wants to be an entrepreneur for non-monetary reasons. She put her husband through medical school and now has a pretty good lifestyle with his high income, but still feels the pull of entrepreneurship. They all worked for me when they were 9-19 years old. I am now just starting a new business using technology I invented while I was recuperating for ten years.

I have thought that this fondness for entrepreneurship was due to their exposure to it while working for me, but at the time, they were not positive about it, seeing me both win and lose at it; my oldest son, who is the first entrepreneur in the family, having gone into it about 15 years ago, swore he would NOT do it, EVER, because of the things he saw when working for me. Now he is the MOST entrepreneurial of all of them. However, after a few years on their own, they ALL went into electronics/computers and talk to me about starting up their own companies from time to time. It is all too complex to describe further here, but, it is clear that the negatives of working in a start-up with me did not permanently keep them away from entrepreneurial longings.

I have gone from believing their feelings have changed from being negative about entrepreneur-ing to positive about it. Since there was a fair amount of negative they saw and now experienced in their own efforts, I wonder, after reading this article, if there IS some sort of genetic inheritance of some part of entrepreneur life which causes them to continue to pursue it. I will be most interested in any further information about this because it is so close to home in my family; in fact, it IS home to us! The nature of my technology invention is so good that perhaps I will be able to help them reach their goals in a few years - if any of us live long enough while fighting our ways through the "e-jungle", (a new term I just made up!) of entrepreneurial adventuring.

If there is a list anywhere for people who want to know more about this concept, I hope I will be on it. I will look into it more after reading this article. Thank you for bringing it to your reader's attention.

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