Entrepreneurship has traditionally been viewed through the lens of economic growth, wealth creation, and innovation. However, an emerging perspective places happiness and well-being at the core of entrepreneurial success. Entrepreneurs, unlike salaried employees, experience unique challenges and rewards that influence their psychological and emotional states.

Last week I was speaking at an International Conference on Entrepreneurship: Economics, Management, and Social Change, organised by Calcutta University and hosted at Sister Nivedita University, Kolkata.  It was on the occasion of celebrating a successful decade of Empowering Women Globally (EWG) program in India aiming towards fostering entrepreneurship through education.

I discussed the role of entrepreneurship in building an ecosystem of happiness to all stakeholders.  It was more through our own research (through HappLab) conducted some five years back on the entrepreneurs (startup initiative beneficiaries) in India leading to develop Entrepreneurial Happiness Model. I am putting across the gist of that lecture for wider audience and their engagement.

The ultimate goal of human life is believed to be leading a happy and peaceful life.  We make best possible choices to choose our career, work-life, profession, employment to earn living to head towards having happy and peaceful life. It also adds to the happiness of other stakeholders and the nation contributing to towards creating positive environment.  We examined different factors like psychological capital, life satisfaction (proxy of happiness), and entrepreneurial success to derive some meaning for the entrepreneurs.

Wealth creation is important for any nation to allow the citizens to explore themselves and fulfil their needs and aspirations.  But as argued by Richard Easterlin (Easterlin Paradox), wealth or income increases happiness only to a certain point, beyond that psychological well-being and/or happiness matters more.   Money does buy happiness but not always and at all levels.   (Read my paper on Money Makes us Happy or it doesn’t) or a brief on this. There is an old blogpost on my personal reflection on money-happiness relationship.

Psychological Capital consists of four key components: hope, efficacy, resilience, and optimism (HERO). These elements play a crucial role in shaping an entrepreneur’s ability to navigate uncertainties and sustain motivation, thereby enhancing their happiness.

Hope allows entrepreneurs to look beyond present difficulties to the possibilities of the future, driving them to create and innovate despite failures. Self-efficacy, or the belief in one’s ability to succeed, empowers them to take calculated risks and make strategic decisions as seen in the journey of Kiran Mazumdar-Shaw with Biocon.

Resilience is particularly essential in entrepreneurship, where setbacks are common; Narayana Murthy’s journey with Infosys after multiple rejections is a testament to this. Optimism enables entrepreneurs to keep pushing forward despite external challenges, aligning with Ratan Tata’s philosophy of seeing opportunities in adversity, leading to ventures like the Tata Nano. Hope and Optimism are viewed differently.

Self-Determination Theory as propounded by Deci & Ryan advocates that the entrepreneurs primarily seek autonomy, competence, and purpose to determine their success.  All these factors head towards making individuals/entrepreneurs satisfied and happy.

Our research reported that

• Hope and resilience significantly impact entrepreneurs’ life satisfaction (β = 0.174, β = 0.227).
• Optimism positively predicts life satisfaction (β = 0.155) but has no direct impact on entrepreneurial success (suggesting excessive optimism may lead to poor decision-making).
• Self-efficacy did not predict life satisfaction (contrary to past research), but it positively influenced entrepreneurial success (β = 0.132).

The Entrepreneurial Happiness Model establishes that happiness is not merely a byproduct of entrepreneurial success but a driving force behind it. Life satisfaction, which stems from personal and professional fulfilment, significantly impacts an entrepreneur’s journey. Our work also reports that life satisfaction does not depend on financial success but rather on perceived entrepreneurial success.

Entrepreneurs often enjoy greater control over their decisions, leading to a sense of independence and intrinsic motivation. Sachin Bansal and Binny Bansal, for instance, left their corporate jobs to build Flipkart, ultimately leading to both financial success and personal satisfaction.

Many entrepreneurs start businesses that align with their personal values and passions, making their work more fulfilling. Falguni Nayar’s transition from investment banking to launching Nykaa was driven by a passion for empowering women, demonstrating how purpose enhances happiness.

Unlike work-life balance, entrepreneurs often blend work and personal life seamlessly, which can lead to satisfaction. Ritesh Agarwal built OYO while traveling and learning from real-world experiences, integrating business with personal growth.

The impact on society also plays a significant role in entrepreneurial happiness. Creating employment, fostering innovation, and contributing to economic progress bring immense joy, as seen in Anand Mahindra’s investments in sustainable innovations and corporate social responsibility initiatives.

Happiness through entrepreneurship is not limited to founders but extends to employees and stakeholders. A happy entrepreneur nurtures a positive work environment, leading to higher employee engagement and satisfaction. Companies like Zerodha under Nikhil Kamath offer employee-friendly policies, profit-sharing, and mental wellness programs, boosting workforce morale. As one of the most important digital entrepreneurs, Nikhil Kamath has leveraged technology to create a stress-free work culture, demonstrating how remote and flexible work models contribute to greater life satisfaction.

Organizations with a strong vision and mission attract passionate employees who derive happiness from meaningful work, as demonstrated by Vineet Nayar’s Employees First, Customers Second strategy at HCL Technologies. Leadership that prioritizes collaboration, inclusivity, and motivation creates happy work cultures, much like the approach taken by Devi Shetty at Narayana Health, where the focus is on affordability and accessibility in healthcare.

Recent shifts indicate that entrepreneurs increasingly value happiness over traditional business metrics like revenue growth. The rise of social entrepreneurship, sustainable and ethical businesses, and flexible work arrangements are all testament to this. Social entrepreneurs like Harish Hande (Solar Man of India) of SELCO derive satisfaction from addressing societal issues, while environmentally conscious entrepreneurs like Ankit Agarwal of Phool.co blend profit with purpose.

Governments and policymakers can foster entrepreneurial happiness by prioritizing mental health support for entrepreneurs, offering funding for purpose-driven startups, and integrating psychological training into startup incubators. Providing counseling and well-being programs, encouraging impact investors, and promoting an entrepreneurial ecosystem focused on holistic success can create a more sustainable and happiness-driven business environment.

Entrepreneurs with a clear mission (hope + resilience) report higher life satisfaction than those driven solely by profit.  Entrepreneurship is more than just wealth creation—it is a pathway to happiness, self-fulfillment, and societal contribution. Focusing on HERO is important that would certainly make an ordinary entrepreneur, a hero. The Entrepreneurial Happiness Model with some of the real-world examples from India demonstrate that successful entrepreneurs derive satisfaction from autonomy, purpose, work-life integration, and societal impact. Future policies need to prioritize well-being alongside economic growth, ensuring that happiness remains at the core of entrepreneurship.