ENTREPRENEURSHIP
invested in your education, leading to a lasting negative impact on those relationships – particularly if there is financial damage involved. In many cultures, older generations might not see entrepreneurship as a valid career and failure could prove them right. If you are already running a company, the worry that other people’s livelihoods are at stake can prey on your mind. There is still something of a perceived stigma about a failed business and in some cultures loss of face is a serious problem, at its worst leaving individuals social outcasts. It can lead to both mental and physical stress, lack of sleep and high blood pressure, as well as other potential health problems. In addition, you may be worried about living up to the expectations of investors, co-founders and customers – in the case of the latter you might be particularly sensitive to a barrage of negative feedback should things go wrong. With this fear of the unknown, it could feel safer to go into a corporate career like everyone else. From hesitance to self-preservation Fear of failure can be affected by a number of factors. It can be influenced by the education you have received, access to finance, or how extensive the governmental support available in your country is– all contributing to weighing up whether you think you will be successful. The culture of the country where you are based is often significant: for example, the more established entrepreneurial culture and higher tolerance of failure found in the US can result in a lower fear of failure than in a country such as Japan, where linear corporate progression is often expected. However, countries with greater economic development tend to have a population that fears failure less; meanwhile, the higher the rate of necessity-driven entrepreneurship – where you need to start a business simply to survive – the less relevant fear of failure becomes. The type of industry you are working in could also have an effect, with fear of failure being more common in risk-averse sectors. Once you have made the decision to start a business, this anxiety may still not leave you. It can make a person very risk-averse, which is not a good thing for an entrepreneurial venture, causing them to only make ‘safe’ decisions that prevent the business from exploring new and more profitable avenues. Worse, in causing individuals to be hesitant when it comes to
The latest Global Entrepreneurship Monitor report found that the number of potential entrepreneurs worldwide who were put off starting a business due to their fear of failing rose to 49 per cent in 2024. Robert Phillips from Alliance Manchester Business School asks how educators can tackle this problem F ear of failure, or atychiphobia, is often cited as the main reason people choose not to start a business. In these instances, prospective entrepreneurs conclude that the number of things that could go wrong in getting their ambitions off the ground outweigh the potential for success. These same feelings are also a key reason behind a business’ inability to grow. Yet, a fear of failure can also have its benefits. It is critical, therefore, that educators understand how to approach this psychological
construct, so that they can optimise the support they provide to students and help nascent entrepreneurs
fulfil their ambitions and achieve success. The psychological barrier
It is important, first, to recognise fear of failure’s potential impact on an individual and how this is viewed in different parts of the world. It can affect many aspects of a person’s life – from their career and participation in sports or other competitive activities to personal relationships – and, among entrepreneurs, such anxiety can manifest itself in a number of ways. Fear of financial failure is a key concern, where your business failing might lead to a loss of income, or even your home and other assets. This can be compounded if you feel you are not keeping up with friends who have gone into a corporate career. Another major consequence of failure can be damage to your own self-esteem – you feel you have let yourself down and this leads to a lack of confidence when it comes to trying anything in the future. The worry of letting down friends and family can also be in your thoughts, especially if they have
Business Impact • ISSUE 1 • 2026
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