Most entrepreneurs come up with their grand business idea while working for another employer. A common reason for entrepreneurs to start their own company is to be their own boss and work for themselves. This motivation sometimes spurs from the fact that their manager is difficult to work with. The reasons may be different: lack of reward, increased criticising, heavy workload, etc. but research shows that many employees decide to start their own business as a result of being dissatisfied with their boss.

Although bad leadership demoralises staff and makes them less productive, on a more positive note it encourages entrepreneurship. Logically thinking, entrepreneurial employees with inventive ideas and the motivation to start their own business are more likely to actually do it if their boss is incompetent. If they are content at their workplace, they would contribute new ideas to the organisation rather than going out and doing it themselves, this would in turn hinder entrepreneurship.

It is safe to say that a lack of good leadership skills is an important source of entrepreneurship. Frustration and dissatisfaction leads to new ideas being formed that breakaway from conventional concepts. In fact, several economies can give credit to the lack of leadership skills for fuelling entrepreneurial ventures leading to new innovations.

What implications does this have for existing managers and leaders? Fuelling entrepreneurship is no excuse to slack on leadership. It is suggested that leaders create a free flowing environment for innovation to occur within the workplace. Leaders should give employees credit on their good work and allow them to share their ideas openly. However, managers shouldn't go to the extreme of forcing certain employees to stay if they wish to start their own business.
After all, a new venture does lead to employment in the economy. Over 65% of new jobs in America are created by businesses that were founded five years ago or less. Beyond employment, entrepreneurs invent and bring new ideas and products to the market. They constantly look for improvements and don't settle for what already exists. Additionally, new business owners generally begin with limited resources; this forces them to make the most of what they already have. They come up with new ways of running a business, improve business processes and learn new skills to reach their goals. Lastly, another important by-product of entrepreneurship is that the owners reinvest their money back into the business rather than spending it on personal luxuries. This keeps money flowing amongst businesses in the economy.