What does not kill you makes you stronger: Entrepreneurs’ childhood adversity, resilience, and career success

Abstract

Childhood adversities, such as neglect, abuse, and poverty, lead to negative career outcomes. Anecdotal stories of entrepreneurs, however, present a contrasting picture, showing that many successful entrepreneurs had a difficult childhood. Building on the underdog framework of entrepreneurship and the stress inoculation model, we resolve the puzzle by hypothesizing the inverted U-shaped relationship between entrepreneurs’ childhood adversities and career success that is mediated by resilience. Using data from a representative sample of 573 U.S. entrepreneurs from the Midlife in the United States (MIDUS) study, we find support for the hypotheses. We further find resilience is more important for less-successful entrepreneurs. Our results are robust to various checks, including an additional study based on a sample of U.S. entrepreneurs from the Qualtrics online panel. Our study indicates the need to consider nonlinear and context-specific implications of childhood adversities and examine performance-related outcomes, thus enriching existing research on childhood adversities and entrepreneurship.