Do Entrepreneurs Take More Risks?

Elisabeth Paté-Cornell, Stanford University

Dr. Elisabeth Paté-Cornell, department chair of Management Science and Engineering at Stanford University, wonders aloud whether entrepreneurs actually take that much risk. She explains that in the United States, venture capitalists take a lot of calculated risk by backing budding start-ups, while in Europe, bankers, acting in the same role, are not. Entrepreneurs usually start with a technical idea for a company and surround themselves with a great team of managers and technicians. Indeed, the success of risk-taking boils down to a single factor: the ability to build teams and cultivate many skills.