Does your level of education determine entrepreneurial success?
It’s an age old question: Does your level of education determine the success of your business?
There’s little doubt that education contributes towards your social capital, opening up a world of career opportunities and networking contacts. But a number of entrepreneurs have gone against the grain and became successful from ventures that are not related to their education qualifications.
- See also: 5 ways a university degree can be useful to entrepreneurs
Richard Branson founder of the Virgin Group and probably the most successful entrepreneur in the world, has made no secret of his poor academic performance as a student.
Famous South African turn-around strategist and founder of Gunguluza Enteprises and Media, Lebo Gunguluza, also admitted that his BCom degree in Economics had no bearing to his success, but he still encourages educations saying: “Education is the key to success in life, and teachers make a lasting impact in the lives of their students.”
Education and success
The Global Entrepreneurship Monitor (GEM) project is an annual assessment that measures difference in the levels of entrepreneurial activity between countries, and also looks at factors that encourage healthy levels of entrepreneurship and to suggest policies that may enhance the national level of entrepreneurial activity.
“In South Africa there is a positive correlation between opportunity-driven entrepreneurship and levels of education,” says study authors Dr Mike Herrington and Jacqui Kew.
We unpack the GEM 2013 South African Report: 20 Years of Democracy report on the impact of formal education on entrepreneurship in South Africa, and it’s proposals on how the education system can be improved to nurture the spirit of entrepreneurship in the country.
GEM’s findings on education and entrepreneurship:
1. The highest percentages of early-stage entrepreneurs in South Africa have at least some secondary education or a secondary degree.
According to the GEM’s report, this shows the importance of education and the positive influence it could have on the level of business start-ups.
2. An educated workforce is vital to organisations’ competitiveness, productivity and growth, the report says.
GEM reports that a sound education system is one of the key imperatives for a competitive country. A good quality education system, it reports, has a positive influence on an individual’s self-efficacy and self-confidence, thereby increasing the chances of such individuals starting a business and making it successful.
3. Even small changes in education and training can have big positive impact and significantly improve the entrepreneurial climate.
These small changes, according to the report, include: ensuring that competent individuals are leading the educational sector’s reforms, improving the quality of the teachers; as well as introducing a stronger focus on entrepreneurship as a life skill to foster problem-solving skills and self-confidence in schools.
The GEM report makes recommendations on how the education system can be improved to nurture the spirit of entrepreneurship. Here are its key proposals:
1. South Africa must establish a nationwide network of walk-in centres to support entrepreneurs, especially informal and small businesses.
The report recommends for the provision of mentorship programmes for new entrepreneurs where the mentors have practical personal experience of running a business.
2. There needs to be a greater focus on entrepreneurship and entrepreneurial qualities in all phases of the educational and training system.
The report recommends for a complete overhaul of the education system, both at primary and secondary level, with particular focus on improving the country’s uptake and pass rates in mathematics and science.
3. There needs to be increased investment in entrepreneurship training programmes and replication of successful privately sponsored models.
GEM says programmes such as Tsiba; entrepreneurial academies located in Cape Town, Soweto and Vanderbylpark; initiatives like Sasol’s Fast Track programme; and SAB’s KickStart programme should be replicated. The report says programmes must be regularly evaluated and continually improved – this includes all public/private initiatives that use government funding.