Entrepreneurial resilience and venture failure

Abstract

This article explores the emotional and psychological functioning of entrepreneurs after venture failure. Accordingly, it investigates the extent to which entrepreneurs exhibit resilience, defined by psychologists as stability in functioning over time, despite experiencing a traumatic event. Entrepreneurial resilience is rarely investigated in the context of failure despite it being a debilitating experience. Our exploration is critical to venture creation as resilience plays a key role in re-entry into entrepreneurship. A qualitative, narrative research design reveals how 11 entrepreneurs functioned after failure. The majority of entrepreneurs show resilience; that is, they exhibit stable levels of functioning. This stability is different from the disruptions in functioning that psychologists label as ‘recovery’ from a severe event. Our findings, therefore, challenge the assumption that recovery is required after venture failure. Implications for re-entry into entrepreneurship and learning from, and coping with, failure are explored.