Entrepreneurship is often seen as a test of creativity, smart thinking, and the ability to take risks. But once you’ve got past the planning and launched your product with a few customers buying it, there’s another important factor that can make or break a business—emotional intelligence (EI).
If you already know the basics of emotional intelligence, recent research offers more to think about: how does EI affect your chances of success as an entrepreneur? And how does it work not just as a personal strength, but as a key business skill?
Evidence That Challenges the Usual Thinking
A 2020 study published in the Strategic Entrepreneurship Journal looked at over 65,000 people involved in starting businesses. It compared how well IQ (general intelligence) and EI predicted success. The results were clear: emotional intelligence explained 89% of the differences in success, while IQ only explained 11%.
This doesn’t mean being smart doesn’t matter—but it shows just how important emotional skills are when running a business.
The Emotional Side of Running a Business
Starting a business is always an emotional experience. New businesses are often unstable—big on ideas but short on time, money, and certainty. In this kind of situation, knowing how to manage your emotions isn’t just helpful—it’s a practical skill you need.
Here’s how emotionally intelligent entrepreneurs use their EI in five key ways:
Self-awareness helps them notice their own habits and emotions, stay grounded, and avoid letting ego take over.
Self-regulation means they can keep calm under pressure—like when a product launch fails or a deal falls through—and choose their responses carefully.
Motivation, in this case, comes from within (intrinsic). Entrepreneurs with good levels of EI stay focused on their bigger purpose, even when things get tough.
Empathy is about more than just knowing your audience. It helps you design things people actually want, lead in a way that feels right, and build trust with your team and customers. Empathetic founders can tell what people need—even when they don’t say it out loud.
Social skills help you bring the right people on board, work through tricky partnerships, and clearly share your vision with others.
Smart Thinking Isn’t Everything
Being smart still matters. It helps you solve problems, come up with ideas, and make sense of complex situations. But it’s not enough on its own. Research shows that leaders with high IQs but low emotional intelligence often struggle when things get tough.
The best entrepreneurs don’t ignore logic—they just know that people skills matter just as much. Many of the most respected founders are not only smart, but also emotionally in tune with others. They know how to build strong teams, not just great products.
You Can Build Emotional Intelligence
Emotional intelligence isn’t something you either have or don’t. You can build it. You can improve by listening to feedback, learning from others, reflecting on your actions, and practising new ways of thinking and responding.
If IQ helps you figure out how to do something, EI helps you understand why you’re doing it, who to work with, and how to keep going. It helps you connect your goals with your actions in a real and lasting way.
A Final Thought
Building a business isn’t a straight path. There are ups and downs, changes, and lessons to learn. Entrepreneurs with emotional intelligence know that what they create on the outside—like a product or company—reflects who they are on the inside.
And in the long run, it’s the people who understand and manage their emotions well who are most likely to succeed—and to build something that really lasts.
