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Smith Business Insight Podcast | Series 1 . Episode 6 Start-up Cycle


Smith Business Insight Podcast

Starting a business is one thing, discover how to keep going when the going gets tough.


Starting a business is one thing, but how do you keep going when the going gets tough? This episode of The Start-up Cycle explores the topic of perseverance. We hear about new research from professor Jana Raver on the relationship between resilience and entrepreneurial success (yep, they're related) and get a final dose of motivation from Jeremiah Brown, author of The 4 Year Olympian. We will also hear about learning from failure. Your host is Meredith Dault. 

This episode refers to the following research:

F. He et al, "Keep calm and carry on: Emotion regulation in entrepreneurs’ learning from failure” in Entrepreneurship Theory and Practice (2018) 42(4), 605-630

Y. Liu, "Narcissism and learning from entrepreneurial failure” in Journal of Business Venturing (2019) Vol. 34 (3) 496-512


00:12: Meredith Dault: Many wise people have said many clever things about perseverance. The actress Julie Andrews, for example, is frequently quoted for saying that perseverance is failing 19 times and succeeding the 20th.Ó She had the unique experience, early in her career, of making a number of films back-to-back, before any of them were released in theatres. Think about that for a minute: there had not been any critical acclaim or feedback from audiences yet she just kept going she kept making movies, and kept trusting in the process. And then when success arrived and it did  it came suddenly. Two of those films she made during that period of not knowing whether anything she was doing was any good at all, were The Sound of Music and Mary Poppins and those two pretty much made her career. 

Now I know: most of us our entrepreneurial ventures do not involve making Academy Award-winning movies, but surely that example still provides SOME kind of insight into the power of perseverance. Because today, for this last episode of The Start-up Cycle, that’s what we are focusing on: persevering throughout your entrepreneurial journey, even when it feels like the last thing in the world you want to be doing. Because YOU are a resilient person. You’ve got this.  

01:29: [Theme music]

01:51: The term resilience comes up a lot these days. We hear it in the context of raising healthy kids by teaching them to bounce back from setbacks and we talk about building resilient communities that are more nimbly poised to overcome economic or environmental challenges. Resilience is even said to be at the heart of finding happiness: without it, some say, we can be too easily knocked off course when pursuing our dreams. 

It should come as no surprise, then, that resilience has also been said to play a critical role when it comes to achieving entrepreneurial success, too. After all, starting a new business is tough, and being able to overcome the inevitable challenges that crop up along the way is a surefire way to get ahead. 

But the fact is that nobody could say for sure whether that was actually true until now. New research by Jana Raver and Ingrid Chadwick draws a strong and definitive connection between innate resilience and entrepreneurial success. For more on their findings, I’m joined by Jana Raver. She is an Associate Professor and Distinguished Professor of Organizational Behavior at the Smith School of Business at Queen’s University. I’m delighted you’re here, Jana this is really interesting research. 

02:53: Jana Raver: Thank you for having me. 

02:55: MD: Just so we're on the same page, what do we mean by resilience in an entrepreneurial context? 

JR: In particular, what we looked at was psychological resilience and this is a more of an innate, um, relatively stable capacity to bounce back. And so, if you have a stressful experience, especially the experience of launching your first new business, it allows you to bounce back from the stressors and then flexibly adapt to those changing circumstances. 

MD: All right, so what makes resilient people then more able to overcome hurdles when starting businesses?

JR: Yeah, one of the keys to resilience and one of the powerful parts of it is that it has a lot of positive emotions. So, people who are resilient have a, um, a great deal of positivity as well. And so it enables them to actually draw from those positive resources. We talk about what's called a broaden and build perspective where they actually draw from those positive emotions as a resource and it broadens their perception and allows them to see things in more flexible ways that then lets them actually build things in a more proactive way. 

03:59: MD: Oh my gosh. All I want to know is how do you develop that? 

JR: Yeah, the resilience portion of itself is relatively stable and so it is actually something that people have more or less of. And that's at least the way that we studied it in this particular perspective. But the skills that come from it can be taught. So, for example, when we, um resilience is the starting point, but ultimately what ends up happening is that people who are resilient have what we call a challenge appraisal, where they think of things, they think of those setbacks, those stressors as challenges that they can overcome as opposed to debilitating threats that are going to impair their performance. So, it's a mindset that really is about overcoming obstacles, that, that grit, that persistence, that perseverance, that really helps them to, um, actually see things in a way that is broadening perception. 

MD: And is that something that one learns as a child or is it a personality trait innately or a little bit of both? 

04:56: JR: It can both be taught as a child, as a child your parents do to play an important role in setting your challenge appraisals. But at the same time, a lot of different situations can encourage it and it is something that we can encourage. So this is one implication when we get to, um, implications to talk about the, um, the importance of importance of entrepreneurial training, um, to help to increase their perceptions of, uh, stressors as challenges and not threats. 

MD: So on the topic of entrepreneurial success: for years, we assumed that the two went together, resilience and entrepreneurial success, but it was an untested theory. So, what compelled you to test it? 

JR: Yeah, it's, it's interesting and it's one of those things that we just take as a truism. You know, every paper begins with some statement about how difficult the entrepreneurial context is. People talk about, you know, how you must be resilient. It's really a metaphor. It's a metaphor that goes throughout the entire field of entrepreneurship. And yet we never actually tested this assumption. And so, we thought this was like my colleague Ingrid and I decided that this was a huge oversight and it's not something that we should be taking for granted, especially in this day and age where we're starting to really do some solid research on resilience. And so, this is one of the main reasons why we wanted to see, not just if resilience changes the early mindsets, but if it actually predicts business success up to two years later.  

06:13: MD: So briefly, how did you conduct your research? How do you, how do you test for that? 

JR: Yeah, this was an interesting approach. We actually were able to get access to entrepreneurs before they launched their business. And so there was a, um, a government funded training program that, that we were able to get access to participants who were about to get some support with regard to their business proposals and then actually some training on entrepreneurship. So we got access to them before they began their program. And so they had a business idea but no training whatsoever. So, at the very, very launch we were able to assess what sort of resilience they came into the program with. And then a few months later after they had started to plan their business, we were able to assess these challenge appraisals, the sense of whether or not they were seeing the challenges that the, the stressors that they were faced with as, um, you know, something that they could overcome and they were really trying hard to overcome, um, or whether or not they were starting to feel impaired and debilitated at that point in time.  

And then, um, about seven or eight months after that, we then were able to do another survey. So, we tracked them over a year of surveys to assess how proactively they were trying to build their business. And this is important. The next connection is: once they have their challenge appraisals, the behavioral consequence of that is that they take proactive steps to continuously improve their business idea, and that we then linked to business survival a year later. And so basically two years from the start of when we first met these, these entrepreneurs, we could predict whether or not they were able to succeed as a function of this challenge appraisal, proactive building of their business. And then, um, ultimately their business being in operation two years later. 

07:54: MD: What a fantastic data set to get to have a group of people like that. 

JR: It was rare and we were really fortunate to be able to access the participants in this program.

MD: So, what does your research then confirm about the relationship between resilience and entrepreneurial success? 

JR: Yeah. We were able to actually empirically document and show that um, the, the people who come in with a certain level of psychological resilience do indeed have that, um, the right mindset and then the behaviors necessary to help them to survive, um, and actually build this business in the long-term. And so yes, we were able to confirm this, that resilience does actually help business survival. So, we've got empirical evidence on that. The other thing that's really important though, it's, it's actually what those mechanisms are. So, it's not just, yes, it helps business survival’, but how? Because I think that how also tells us what to do differently in our entrepreneurial training and our programs. So, we can say a lot of it's actually about the, the way in which you approach stressors, which we don't often talk about in entrepreneurship research. The way that entrepreneurs are faced with stressors and how they mentally approach those in a way that's really constructive is important. Because when they do that well, they then proactively build their business because they're enabled, they're motivated in a way that actually leverages those challenges as opposed to starts to derail people into, um, you know, feeling like they might be a failure and Oh, it's good enough. I don't need to make it better’. 

MD: How much of an edge does it give them? Do you know that? 

JR: Yeah. So one of the interesting findings here, if we just look at the distinction between proactivity and business survival, the, um, those, those entrepreneurs who are more proactive in building their business, they had 129% increase in the odds of business survival. 

MD: Wow. 

JR: And so that's just that proactivity to business survival link at the very end of the model. So, if we can get people to be proactive, it has a huge effect on whether or not they're actually going to survive. If we look at the full model from all the way at the very, very beginning of only, the only thing we know about entrepreneurs is their levels of psychological resilience when they come into the program. If that's all the information we have, we can predict their chances of business survival within 8% odds. So, we can actually say that those who are more resilient, just a little bit above average and resilience have an 8% increase in business survival two years later knowing nothing else.

MD: Remarkable. It really feels like that should be fundamental skillsets that are, that are offered, how to build resilience. 

JR: Yeah. 

MD: It seems like that's the greatest differentiator?

10:23: JR: Absolutely. I think we need to be talking about having people who are resilient at the very, very beginning, but then building those skills that they need, teaching them stress management, teaching them the challenge appraisal, teaching them the proactivity, and also making sure that they've got the support systems necessary in order to maintain that over a period of time. Because as you can imagine, I mean entrepreneurship is incredibly challenging in and of itself and they need a support network in order to actually help them, um, be able to maintain that positivity in their mindset. 

MD: What surprised you most about your research? 

JR: I think we always hope that we're going to be able to predict business survival, but it's incredibly difficult to actually do that because there's so many factors that go into this. And so the strength of the connection, the, the fact that we could actually predict that over a period of time and you know, even the proactivity predicting business survival with a 129% increase in odds. I mean that's, that's pretty remarkable. 

MD: So, you suggested in your paper where you write about this research that government programs aimed at supporting new entrepreneurs might actually be overlooking the value of teaching resilience skills. Can you talk more about that? 

JR: One of the things that we discovered in working with government programs, um, focused on entrepreneurship is there's a lot of emphasis upon the quality of the business plan, the operations, the finance, the financing, um, marketing, you know, really the business skills side of it. But entrepreneurs aren't given much training or support with regard to the personal side and the personal journey that they go through. And I think our research is really showing quite strongly that the personal journey and that personal psychological mindset is incredibly important. And you know, just this, this untapped resource that's going to actually help people to, to add personal value. So they need to be able to manage themselves well, above and beyond managing the business and the operations, the marketing and accounting and the finance and everything to get those pieces right - yes, that's important. But we need to be talking to entrepreneurs about how to increase their psychological wellbeing and overcoming those stressors so that they can bounce back. 

12:35: MD: So what would you like to see happen? I mean, knowing this, how would you like to see programs change? How would you like to see education change? 

JR: Yeah, I think every entrepreneurship training program should have a piece on self-management within it so that entrepreneurs are, are better able to understand themselves and the way that they react. Um, some of the things that they start to feel the self-doubt, the, um, feeling of defeat, the feeling of being overwhelmed. Most entrepreneurs will relate to that. They've been there at some point. And so rather than going down that pathway of feeling defeated and impaired by all of the challenges going on around them, teach them instead how to find sources of positivity, look after themselves, and then find the, that leverage that positivity in ways that are actually going to make them reframe all of these challenges in a positive light and be able to take action based upon them and be proactive based upon that. 

MD: I feel like we would all benefit from developing that stuff, not just entrepreneurs. This is the type of thing that we also like to see in leadership development and any sort of um, you know, life management, you know, social skills type of class that are actually going to help people to better be become better versions of themselves. 

MD: Yes. Sign me up. 

JR: Me too. 

MD: Jana. Thank you so much. It's been a pleasure having you today. 

JR: Thank you. 


MD: And now it's time for an episodic feature we call  Show Me The Evidence, with Alan Moranz, editor of Smith Business Insight.

14:23: Alan Morantz: It has been said that experience is simply the name we give our mistakes. This pretty much sums up the distilled wisdom of the typical entrepreneur. If you haven’t failed, you haven’t tried. 

If you think about it, the study of entrepreneurship is largely the study of how entrepreneurs learn from failure. We’re talking about supremely self-confident creatures  it can be tough for entrepreneurs to own up to their mistakes. Bankruptcy, market miscalculation, rejection from venture capitalists, these can all be painful and even traumatic experiences. It’s awfully hard to identify important lessons and incorporate them into future endeavours when you’ve been through an emotional wringer. 

Fortunately, researchers have started to look at how entrepreneurs learn and, in particular, how they learn from failure. A recent study, led by Viviannna Fang He of ETH Zurich, looked at entrepreneurs’ learning behaviours in relation to the rate at which business failures are experienced academics call this failure velocity. The researchers figured that when an entrepreneur experiences failure rather infrequently that’s low failure velocity  then the learning takeaways simply don’t stick. And when failures happen repeatedly, the emotional noise that the entrepreneur has to deal with outweighs any motivational and informational benefits. 

The researchers surveyed entrepreneurs in the IT space in the United States and Finland. When they crunched and analyzed the numbers, they came up with an inverted U-shape. With low failure velocity, entrepreneurs remained complacent and lacked motivation to continue learning. With high failure velocity, the entrepreneurs were too distracted by negative emotions. There was a sweet spot, with just enough of an edge to keep the entrepreneur hungry to harvest and incorporate new insights. 

Now, the entrepreneurs have some agency here. In particular, the researchers found that the ability of entrepreneurs to regulate their emotions can have a big effect on how well they can learn from their failures when those failures pile up. Legendary risk-takers such as Richard Branson and Steve Jobs were able to maintain a level of learning as their failure velocity increased because of their emotional intelligence.

So what should entrepreneurs do? The researchers have a few suggestions. One is visualization: instead of imagining yourself winning an Olympic bobsled medal, create mental pictures of business failure as well as the coping processes that were used.  

Another is vicarious learning: basically, learn from the failure of others. Maybe it’s a peer who’s gone through a rough business patch or a mentor who can coach you through some challenge. You can definitely experience vicarious learning at a gathering such as Fail Con, where experienced entrepreneurs openly discuss their own mistakes and failures.

And a third option is training in emotional intelligence. Take a professional program to help you develop your emotional competencies. 

The message here is: Fail away, and keep cool!

We’ll put a link to the journal article in the show notes if you’re interested in learning more.

I’m Alan Morantz, and I’ve just shown you the evidence.

[Musical sting] 

18:09: MD: And finally, we thought we’d better wrap up this last episode of The Start-up Cycle with a final dose of motivation in the form of Jeremiah Brown. Jeremiah is a former Olympian a rower, to be precise. He won a silver medal for Canada at the London Olympics in 2012 as part of the men’s eights. But the story of how he got to the medal and the Olympics  is a unique one. Here’s a hint: he’s written a book about it’s called The 4 Year Olympian. After holding a leadership role with the Canadian Olympic Committee, Jeremiah who has done executive education training at Smith School of Business - is now a sought-after speaker. Jeremiah thanks for joining me. 

Jeremiah Brown: My pleasure. 

MD: So, yours is an excellent tale about sticking it out and pushing through the hurdles, but I have to believe that at some point during that journey you must have experienced some doubts about what you were doing as you were working your way to the Olympics. Can you talk a bit about some of those dark nights or how you dealt with some of those challenges? 

19:07: JB: Yeah, I would say most of the journey, the body of the journey, was filled with doubts and the doubts became ever present and it was just something you were saddled with and then you're tasked with figuring out ways to deal with it. And a lot of it is emotional management, I found. So, there were times being an outsider, of course that wasn't accepted as a teammate when I joined this, this team. I was someone who was there to take someone else's spot in an Olympic boat potentially. So, it was quite isolating, quite lonely. The odds were against me, uh, right from the beginning and I had to figure out how to just stay, just stay in the moment on a daily basis and not, not tell myself some kind of affirmation about, you know, how everything's great because it wasn't to be real, but then to have a quiet inner voice of, you know, you're, you're worth this shot that you're taking. And, and for me it was about that self-esteem to have that little voice inside that when everything was heavy and dark and for long time, weeks and months, sometimes through the winter training, just to remind myself that, you know, your worth, you're worth taking this risk, you're worth taking this shot. 

MD: And that's, that's amazing. I mean how did you, I guess firstly, I mean people should understand what ridiculous, amazing journey what an amazing journey this was. How you got to where you were in such a short time.

JB: Yeah, maybe I should back up

MD: Probably. Yeah, maybe the Coles notes version of it. Cause I know it’s an amazing long, packed time. 

JB: Yeah. I mean, the Coles notes version of my story is: I was a young man, found myself, uh, with a family at the age of 19, two years into a business degree. And when I was on the other side of the university, like everyone else, I was trying to find a job to support myself and my family, but I also had dreams. And I was watching the Olympics in 2008 and I saw the Canadian team win the gold medal in rowing decided I was going to take my moonshot and, and almost subconsciously formed and, and made my decisions around my career choices around this crazy idea that I was going to try to become an Olympian. And so, long story short, I moved 4,000 kilometers from my home in Ontario out to Victoria, British Columbia, where the team was based. I met a coach who was, you know, key to believing that this could be done together with his guidance. And I was working full time and learning how to row in the mornings. And it wasn't until two years later that I finally, uh, after, after a lot of setbacks and, and trials and tribulations, I was able to join the team on a full-time basis. And then it was on this sort of rocket journey of 18 months to try to learn how to compete, and how to slot in at that elite level and make it to the Olympics, which I did.and I give credit to the people around me. You know, I as an individual, you have to make the choices to create your environment, but really, it's the environment that ends up pulling out the most from you. So that was my experience. And then, you know, 18 months later, went to the Olympics, won a silver medal, and I've rowed six times since then. That was it.

MD: Amazing. Congratulations. Way to, I mean, it's not exactly the same as an entrepreneurial journey, but it's not exactly dissimilar either. I mean, you set yourself a goal and you, you made it happen.

22:37: JB: Yeah. And I think that where the similarities do exist between being an entrepreneur, which this essentially what I am doing right now as a speaker, is very entrepreneurial -building a business and some thought leadership around that experience is you’re always hurdling towards the next milestone and you're very fixed on: I have to hit this milestone or I'm out, I don’t have the cash or the investors. I don't have the sales I need. For me in rowing it was, you know, I have to be this fast by this time or the window closes and the dream’s, you know, it's over. So very milestone focused and I think there are a lot of similarities between the two in that regard.

MD: So, over the course of your own journey, what did you learn about perseverance?

JB: I learned that perseverance is more about how you deal with disappointments. It's not about seizing the day so much. It's not about, um, moments of bursting through, uh, challenges. It's more the heavy slog. The day in, day out, I'm drowning-in-sorrow kind of feeling and figuring out how do I move forward and how do I do it effectively’ despite my emotions telling me that this is, this is wrong and that I shouldn't be here in this moment, that I should be taking steps to protect myself, to flee to safety. Perseverance to me was figuring out how do I wear this emotional baggage but still be effective, because it's not enough to just stay in the game. You have to stay in the game, but then you do have to perform. So that to me perseverance is reconciling the need to perform with the emotion of wanting to stop on a consistent basis over, you know, a period of time. For me it was four years from start to finish, but that's, but that's what it is. Sometimes I think people think of perseverance as just overcoming, you know, a crucible moment or a particular obstacle on the journey. Sometimes the whole journey is an obstacle and you have to figure out how to be effective while managing all the emotion that's pulling you in the opposite direction.

MD: So what in your experience is the best way to manage those emotions? Then it's one thing to recognize them, but what do you do with them?

JB: I think it's about creating your environment. So, especially as an entrepreneur, that's a lonely endeavor. Um, but the most successful entrepreneurs have mentors, they have masterminds, they surround themselves with people they trust, um, who give them feedback. And you know, first you're pushing something onto the world where it's very much you, and you're isolated, and there's a certain degree of self-belief. You need to have to go to a point where other people are starting to believe in you. But once you've, you've validated your idea or whatever it is you're trying to do, it's so important to quickly surround yourself with people who have a common vision, who are ideally, you're trying to achieve the same thing as you. For me it was my teammates, these, you know, these athletes, some of them defending Olympic champions, and it's like boom, there's the standard. I mean really powerful. And I had key coaches along the way that picked me up, you know, dusted me off when I couldn't see a way forward, how physically this was going to be possible. Who reminded me that, you know, there's a reason you've come this far and here's the plan and here's the path and just stick to the game plan. So, I think it's more about creating your environments and who are you surrounding yourself with and who are the key people that you trust that are going to pick you up, you know, when you're down. Uh, cause there's definitely some moments where, you know, you're overcome. And if it was just me on my own, I would've quit probably a hundred times. But because of the environment creation I put around myself, I was able to piggyback off of those, you know, key players. 

MD: God, it must have felt incredible when you achieved it. 

JB: Unlike anything I've ever experienced in my life, absolutely. It's a moment filled with gratitude to have shared it with, with the team, uh, euphoria coursing through your body. It's really, it's really a unique human experience crossing that Olympic finish line.

MD: So if you were going to be giving advice, I mean you do now in your new role as a speaker I mean, I guess you're, you're speaking to people all the time from different walks of life, but if somebody came to you and said I've got this business, it's kind of faltering. I'm having doubts’ I mean, what is it that you would say to them about persevering?

JB: I would say that I think we're wired to always think that doomsday has arrived when it's probably still three months away, for example. So, uh, you know, the old, the old advice of always push further than you think or, or push to the point where you feel like you failed and this, and realize that this is where, this is where your competitors, this is where most people drop off on the curve and maybe you still will fail. But what if you went what if you went further than you ever have in the past? What if you really tested reality, not just your perception in the moment of your pain, and continued and, and what kind of possibility would that allow for you? You know, just things are going to happen, good or bad. And if you stay in the game, then you learn. If you stay in the game and you take action, there are things that you just can't possibly foresee. 

And the smarter you are, the greater the challenges, because the smartest people have the greatest challenge of, of thinking that they see the lay of the land, they see the future, they see the opportunities, threats, whatever. But having the humility to know that things can change. Things can change in a day, in a week, in a month. And so, if you really believe in this thing and you've committed to it in a big way in your life, in terms of resources and time, uh, you know, when you get to the point of quits, see how long you can go further. You know, give it another month, go past, past that natural place where you've given up in the past because then it's new ground for you and then you find, you find out one way or another. Um, you know what truly is possible. It's kind of, you know, it's, you're learning. The goal is you want to learn about yourself in situations you haven't put yourself in yet and have faith that there's going to be something that comes out of that.

MD: My goodness, if I were going to end a six-part series on entrepreneurship anywhere, I think that would be the place I would end it. I feel so full of possibilities right now. I don't know. How do you feel?

JB: I feel the weight of possibilities (laughter). 

MD: Um, listen, I really want to thank you for your time. I know you're a busy man. Um, this has been fantastic. So, uh, thanks again. Let's, let's hope that anybody listening out there feels inspired and ready to push past that point where they think they can't do it and, and chase after the Olympic gold, not unlike the way you did.

JB: It’s scary, but I promise you it’s worth it. 

MD: Fantastic. Thank you so much for your time today, Jeremiah.  

JB: Thanks for having me. Great to chat. 

[Theme music] 

MD: And with that, we come to the end of The Start-up Cycle. Thank you so much for joining us for this ride through the highs and lows of the entrepreneurial journey. If you’re hankering for more, you can read articles about entrepreneurship along with lots of other business research  on the Smith Business Insight website, which you’ll find at I’m Meredith Dault at the Smith School of Business at Queen’s University. Thanks for listening.