social skills

Having a great product, an amazing team and an IQ over 120 are not sufficient for success. An entrepreneur must also possess effective social skills [1]. They must rely on these skills to form relationships with customers, suppliers, employees and venture capitalists. They have to convince people to love their product, idea and vision. They need to create an environment of collaboration in order to facilitate interaction between employees.

Founders must be the person to lead their team to success and their social skills are critical in this endeavor.

Research suggests that socially competent entrepreneurs create more effective personal relationships [2], receive more funding [3], are more financially successful [1] and have more successful companies [4] than entrepreneurs who lack effective social skills.

Social competence is therefore a key differentiating factor between the success and failure of an entrepreneur and his venture.

The 5 factors that underlie social competence in entrepreneurship

1. Social perception

Is the ability to accurately perceive others (their traits, intentions and motives). Social perception assists the entrepreneur in:

  • Determining whether others are being truthful in negotiations
  • Choosing the best job applicants
  • Determining the cause of a substandard performance
  • Correctly gauging current moods and emotions of others

2. Impression management

Involves techniques for inducing positive reactions in others. Entrepreneurs with good impression management skills:

  • Use flattery to their advantage
  • Appear to like someone even when they don’t
  • Agree with others when it’s appropriate
  • Enhance their appearance and image

3. Persuasiveness

Involves the ability to change others’ views or behavior in desired directions.Persuasiveness is important when obtaining financing, recruiting key employees, interacting with customers and conducting negotiations.

4. Social adaptability

Is the ability to adapt and feel comfortable in a wide range of situations. Entrepreneurs with good social adaptability can.

  • Easily adjust to any social situation
  • Be comfortable talking with many types of people

5. Social expressiveness

The ability to express one’s emotions and feelings clearly in order to generate enthusiasm in others. Social expressiveness is related to success for entrepreneurs in the high-tech industry [1].

All five of the factors that underlie social competence are essential for entrepreneurial success. They each contribute to an entrepreneur’s ability to connect with employees, customers, prospects and venture capitalists. Social competence is the key to selling a vision, inspiring greatness and leading a team to success.

How to increase social competence

If, after reading the five factors that underlie social competence, you are aware of areas of self-improvement, below are steps to help you increase your social competence.

  • Practice — start by working on skills in a non-threatening environment, then gradually increase the difficulty of the task
  • Take risks — the best way to improve is to push yourself beyond your comfort zone
  • Seek feedback — watch videos of yourself speaking and ask others for genuine feedback
  • Increase non-business related communication — go on dates, hang out with friends and talk to people at the gym or the table next to you when you’re out for dinner
  • Interact with socially skilled people and model their behavior
  • Define specific goals and work towards them — pick one or two social skills and define steps to enhance these skills
  • Build self-esteem — pick up an exciting hobby and surround yourself with people who respect you
  • Put yourself out there — attend events, accept invitations and join clubs where you will meet new people

How to compensate when you lack social competence

Lacking social competence will not completely stop you from succeeding. However, it will be an obstacle that you will continually need to navigate. Below are five steps to help you with this process.

  • Have an amazing product and surround yourself with an amazing team
  • Reduce in-person and phone communications (increase email communications)
  • Hire individuals who are extremely socially competent
  • Practice, practice, practice — you should always be enhancing your social skills
  • Hire a professional — there are many psychologists who specialize in working with individuals with social phobia and those who lack sufficient social skills

Aspiring entrepreneurs as well as those with proven track records should reflect honestly upon their social competence. By identifying areas for improvement, they can proactively increase the social skills that may be hindering their progress within a business world that values personal relationships. The success of your business may depend on it.


[1] Baron, R.A., Markman, G.D., 2000. Beyond social capital: the role of entrepreneurs’ social competence in their financial success. Academy of Management Executive 14 (1), 106 – 116.
[2] Vesper, K.H., 1990. New Venture Strategies, second ed. Prentice-Hall, Englewood Cliffs, NJ.
[3] Cable, D.M., Shane, S., 1997. A prisoner’s dilemma approach to entrepreneur – venture capitalist relationships. Acad. Manage. Rev. 32, 142 – 176.
[4] Duchesneau, D.A., Gartner, W.B., 1990. A profile of new venture success and failure in an emerging industry. J. Bus. Venturing 5, 297 – 312.