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Risky business: Impulsive people make the best entrepreneurs ......

 
By admin at Mon, 2008-11-17 08:39

The contestants on Dragon's Den rely on convincing business ideas to win funding from the intimidating panel.

But scientists say people's risk-taking prowess is a better guide to whether they would make a good entrepreneur.

And drugs could be developed that enhance the gambling streak that is needed.

Entrepeneurs take riskier decisions than managers, the University of Cambridge team revealed.

Psychologists traditionally viewed risk-taking as an abnormal behaviour, associated with disorders such as drug abuse and manic depression.

But the research team claims that entrepreneurs show an adapted type of impulsive risk-taking that allows them to seize opportunities under stress.

Entrepreneurs choose to start up their own businesses instead of working in an existing company.

They can gamble their finances, reputation and even their families and self-esteem in the hope of making greater profits as they 'go out on their own'.

And Professor Barbara Sahakian and colleagues say it is these high-risk decisions which make entrepreneurs stand apart from the rest.

The claim is based on cognitive tests completed by 16 entrepreneurs and 17 managers from Silicon Fen, a cluster of high-tech companies around Cambridge.

Entrepreneurs and managers made similar decisions concerning 'cold' processes - real-life tasks such as planning and hiring staff. But 'hot' options, such as financing a potentially excellent but highly risky business, were dealt with differently by the two samples.

Managers and Entrepreneurs both made good quality decisions, but entrepreneurs were markedly more risky, the researchers say.

Entrepreneurs also showed more flexible thinking and were more impulsive - processes that are closely linked to the chemistry in the brain and in particular the neurotransmitter dopamine.

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