Your high school friends may shape whether you become an entrepreneur decades later

A new study suggests that teenage friendships may play a significant role in shaping whether an individual becomes an entrepreneur decades later. Researchers found that having a teenage friend who later became self-employed was associated with the person's own business ownership in their late 30s. However, not all entrepreneurial friends had the same impact.

Friends who built formal, incorporated companies were more predictive of entering both incorporated and unincorporated self-employment than those who simply worked as freelancers. This distinction is crucial, as formal, growth-oriented entrepreneurship tends to generate greater economic returns. Additionally, people whose teenage friends later built incorporated companies earned more from their own ventures in midlife compared to those whose teenage friends did not.

The relationship persisted even when accounting for whether the individuals themselves had incorporated their businesses. The findings suggest that adolescent friendships can influence the scale or economic performance of entrepreneurs' ventures. There are several possible explanations for this long-lasting influence, including the establishment of social channels that carry entrepreneurial examples and the similarity between teenagers in terms of risk-taking and independence.

The study adds another social pathway to the development of entrepreneurial trajectories, which can begin long before adulthood. This has implications for how policymakers and educators approach entrepreneurship support, suggesting that schools could create environments that foster such connections earlier in life.