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To succeed in the unpredictable world of start-ups and business, entrepreneurs need more than just a good idea—they need strong leadership traits. 

Effective leadership is one of the most critical ingredients in an entrepreneur’s success. Without strong leadership, even the best ideas can fail due to lack of direction, poor team performance, or weak organizational culture.

Fortunately, leadership is not an inborn trait; it can be learned and developed, something Frank Newman, founder and CEO of Newman Human Resources Consulting, says can be done by promoting the ‘5Cs’ - connect, clarify, coach, courage and compassion.

“These are the five elements that really make a great leader and they're more important now than ever,” he says.

Connection

“By connection what I mean is building meaningful relationships with your team because without that emotional component, people are not going to follow the leader, they're not going to respect them. And more importantly, they're not going to trust them,” says Frank. “It’s really getting to know them on a more personal level; if we feel our bosses care about us, we will care more about our bosses and then we will care more about the company itself.”

He says leaders must also consider ways to connect with employees who may be working virtually and recommends using various tools, including employee surveys, to understand what people are thinking about. 

“It’s about finding other ways to connect and get information back because the more exchange of information you have, the more powerful that connection is going to be.”

Clarify

“What I have found in my experience is that so much of discomfort or lack of success in the world is because people are not clarifying expectations or goals or missions, so if employees are unclear on where the business is going, particularly right now, they're not going to be as effective,” says Frank, adding employees will make assumptions without clarification. “They'll have different expectations and then, sadly, we will disappoint them because we don't know what they want. It’s about taking time, particularly with all the chaos around us, to verify when it comes to objectives or roles.”

Coaching

“More and more we’re seeing the role of coaching is different from being a manager. A manager tells people what to do, a coach gives them the tools to do it,” says Frank, noting the importance to develop and support employees. “This is something that most people really appreciate when their boss takes the time connect with them. Obviously the more you coach, the more your staff are going to grow and it's going to be easier on the boss.”

Courage

“Leaders need to have the courage to make tough decisions, and decisions to change the team and the courage to ask for feedback. So often in business I see people who are afraid to make tough decisions and that has a lingering effect,” says Frank, adding it can be challenging. “It takes courage to ask for feedback and sadly I don't ask for very much myself because I don't like the story sometimes. I think in this day and age for a leader to be connected with the people to ask for that feedback is going to make a huge difference and sometimes, quite frankly, most people don't like to get feedback.”  He says when it comes to asking for feedback, it must be done in a positive way.

“It’s about creating connections and dialogue and being authentic leaders,” says Frank.  

Compassion

“We’re living in a very anxious and very fragile world these days, so people are naturally on edge. They're upset, they may be worried about their financial futures,” says Frank. “A compassionate leader will create that emotional bond with people and will be able to guide them wisely if they're doing some coaching. I think that's really going to make a difference if you can create a compassionate organization.”

He says for many people, work has become a ‘sanctuary’ away from the stress or pressures of home.  “If you can create a compassionate workplace that has a little bit of a sanctuary feeling so people feel safe there, that's important. I've had people that were having struggles at home, and say ‘I just want to come to work because work is sane’. Work is logical and there's no drama.”

Good leadership is not a fixed trait but a continuous practice. For entrepreneurs, developing strong leadership abilities is essential for building successful businesses, inspiring teams, and achieving long-term goals.

By cultivating self-awareness, improving communication, leading by example, building emotional intelligence, and committing to lifelong learning, entrepreneurs can grow into the leaders their ventures need. With persistence and humility, any entrepreneur can transform into a confident, capable, and ethical leader.

Steps towards developing good leadership traits

Cultivate self-awareness

Entrepreneurs must understand their own strengths, weaknesses, values, and motivations. By reflecting on their behaviours and decision-making patterns, they can identify areas for improvement. Entrepreneurs who know themselves well are better able to regulate their emotions, make authentic decisions, and inspire trust in others. 

Develop clear communication skills

Entrepreneurs must communicate their vision, goals, and expectations clearly to employees, partners, investors, and customers. This includes not only speaking clearly, but also listening actively. Good leaders are able to adapt their communication style to different audiences, making sure everyone understands the mission and their role in it. 

Lead by example

Entrepreneurs should demonstrate a strong work ethic, integrity, accountability, and resilience. If an entrepreneur expects their team to be committed and enthusiastic, they must show that same passion and dedication themselves. By consistently walking the talk, entrepreneurs gain credibility and respect. This inspires employees to follow their lead, creating a strong, values-driven company culture.

Build emotional intelligence

High-EQ leaders can handle interpersonal relationships judiciously and empathetically. They can manage conflict, give constructive feedback, and motivate diverse personalities. Entrepreneurs can develop their emotional intelligence by practicing empathy, becoming better at reading nonverbal cues, managing their stress levels, and reflecting on how their behaviour affects others. Learning to pause before reacting in difficult situations is one practical habit that can boost EQ over time.

Invest in continuous learning

Entrepreneurs face new challenges at every stage of growth — from launching a product to scaling a team to navigating market shifts. A commitment to lifelong learning helps entrepreneurs stay agile and effective. Entrepreneurs should actively seek out knowledge on leadership strategies, industry trends, and management techniques. They should also be open to learning from their own failures and mistakes.

Foster a collaborative mindset

Instead of trying to control every aspect of the business, they build strong teams, delegate effectively, and empower others to contribute their talents. Entrepreneurs can foster a collaborative mindset by hiring people with diverse skills and perspectives, encouraging open dialogue, and creating an environment where innovation and experimentation are welcomed. 

Practice resilience and adaptability

Strong leaders are resilient — they recover from setbacks quickly and use them as opportunities to grow. Entrepreneurs can strengthen resilience by developing a growth mindset, which means viewing challenges as learning experiences rather than failures. Building a support system of peers, mentors, and advisors can also help entrepreneurs navigate tough times with greater strength and perspective.

Focus on ethical leadership

Entrepreneurs must commit to acting with honesty, fairness, and transparency in all their dealings. Ethical leaders build trust with employees, customers, and investors — and that trust becomes a powerful competitive advantage. To develop ethical leadership, entrepreneurs should define their core values, create clear ethical standards for their companies, and hold themselves accountable. When mistakes happen, ethical leaders take responsibility, make amends, and use the experience to improve.

Develop decision-making skills

Good leaders can gather relevant information, weigh options, anticipate risks, and make timely, confident choices. To improve decision-making, entrepreneurs can use techniques like SWOT analysis (strengths, weaknesses, opportunities, threats), seek input from trusted advisors, and practice making decisions with incomplete information. Learning to balance intuition with data is also an important leadership skill.

Seek mentorship and build a network

By building relationships with experienced mentors, peers, and industry leaders, entrepreneurs can gain valuable insights, guidance, and support. Entrepreneurs should actively seek out mentors, join professional associations, attend industry events, and cultivate relationships over time. Learning from the successes and failures of others accelerates leadership growth.