What Is the Link Between Entrepreneurship and Trauma?

In a 2020 study published in the Journal of Business Venturing, researchers found that "Adverse experiences in childhood increase the likelihood of becoming an entrepreneur." A UC Berkley Study found that 72% of entrepreneurs are directly or indirectly affected by mental health issues (vs 48% of non-entrepreneurs.) A 2021 study in the Journal of Business Research. found that Adverse Childhood Experiences negatively impacted entrepreneurial success (particularly for women) whereas a 2022 study in the Journal of Business Research found that childhood trauma tended to have a positive resilience-building effect on entrepreneurs. There is a strong link between entrepreneurs and trauma. How can we use this knowledge to better understand - and improve - our entrepreneurial journey. 

Trauma Builds Resilence

For some individuals, trauma can serve as a catalyst for entrepreneurship and the pursuit of success. Entrepreneurship requires a great deal of determination, resilience, and a willingness to adapt to changing circumstances. These are all traits that can be found in people who have experienced trauma.

Trauma and Risk

Entrepreneurship requires risk-taking. Researchers suggest that some individuals who have experienced trauma are more likely to be comfortable with risk-taking and may have a greater tolerance for uncertainty. In other cases, trauma reduces one's comfort with uncertainty and it may take a concerted effort to take the risks required to build a business in a way that feels safe. 

Trauma and Regaining Control

Other studies have found that individuals who experienced trauma were more likely to report a desire for control over their lives. This desire for control may be what drives some trauma survivors to pursue entrepreneurship. By starting their own businesses, they can create a sense of autonomy and control that may have been lacking in their lives. Many folks turn to entrepreneurship after being bullied in the workplace. Women, racialized people and people with disabilities are often targeted in toxic workplaces and entrepreneurship feels like a safer choice. 

Trauma and Empathy

Trauma survivors may have a heightened sense of empathy and a desire to help others. This can be especially true for individuals who have experienced trauma in the form of abuse or neglect. By starting a business, they may be able to create a positive impact in their community or provide a service that helps others who have experienced similar struggles.

Oprah Winfrey has spoken publicly about her experiences with childhood abuse and trauma, and has used her platform to inspire and motivate others to overcome their own struggles. She has also used her success to give back to her community, supporting various charities and organizations that work to help those in need.

Mindset is Key

Studies have found that trauma generally has a negative impact on most workers but we've seen how it can have a positive or negative effect on entrepreneurs.  A 2022 Traumatology study of entrepreneurs in COVID found that those who achieved success saw stressful events as a challenge rather than an obstacle. Mindset work such as somatic practices, mindfulness practices, cultivating community and having supportive people in your life can make a huge difference in your success. 

Getting Help

Individuals who have experienced trauma may be more likely to develop mental health issues such as anxiety and depression. It is important for trauma survivors to seek professional help and support if they are struggling with these issues. Entrepreneurship can be incredibly stressful and can create its own trauma such as financial uncertainty or feelings of rejection. It's important to have a strong sense of community. 

Trauma can have both negative and positive effects on a person's life. While it can be difficult to overcome, it can also serve as a source of motivation and inspiration. For some individuals, the skills and perspectives gained through their experiences with trauma can make them well-suited for entrepreneurship. By pursuing their entrepreneurial goals, these individuals can create successful businesses that not only benefit themselves but also make a positive impact on the world around them.