Personal Developments

People With Higher IQ Makes more Money. But When It Comes to Making Boatloads of Money… Ha!

Yes people with higher IQ do make more money. According to a very old study carried out in USA in 1921. A psychology expert named Lewis Terman studied 1600 children from California. They were selected by their teacher based on their intelligence.  Their IQ scores to found to be an average of 140 which is considered the minimum scores need to become a genius.

And when Lewis Terman revisited them 6 years later, he found that smarter kids are stronger, taller and healthier. And in 1955, almost 30 years later. these selected children have an annual income that is more than 6 times that of an average American.  Furthermore, two thirds were degrees holders and most of them moved on to become professors and faculty members of prestigious university like Yale, Stanford and Harvard.

It was clear that people with higher IQ are more likely to become high income-earner later in life.



However, not all of the 1600 children were successful. About a third of them earned only slightly higher than the average American. It was funny because about 30 years ago, their IQ level were 140 which are at a genius level. And yet, despite such powerful intelligence, they are only merely earning slightly more than the average American. Furthermore, this third of student were more likely to be obese, alcoholic and divorce with their spouses.

This show that children with very high IQ can grow up to become a LOSER too.


Although these 1600 children had very high IQ score, the chances of them becoming a highly successful entrepreneur are nowhere as high. They are just as likely as any average American to become an employee instead of innovating, entrepreneuring and earning boatloads of money.

It’s seem that conventional IQ test cannot predict who will become a great entrepreneur.



So how do we predict if someone can be a successful entrepreneur? It seems that Robert J. Sternberg, a researcher from Yale University have the answer. He mentioned that a total of 7 factors were required to predict if a person would become a great entrepreneur. Of the 7 factors, 4 of which is social and the remaining 3 were on different type of intelligent. Hint: And it really make a lot of sense.

Robert J.Sternberg said that 7 factors are required to predict if a person has the potential to become a great entrepreneur.

According to Baron who were cited by Robert, he said that most entrepreneur studied by him were highly competent in social skills. And score very well on social test on four different aspects of their social skills. Here’s 4 of them.


#1 – Social Perception

Great entrepreneur is very talented at spotting different arrays of complicated emotions from people around them. Are they very angry or just slightly angry? How agreeable are they to their ideas? Are they lying? How motivated were they? Apparently, great entrepreneur can answer those question with great accuracy. They are almost like mind readers.


#2 – Impression Management

Great entrepreneur are very likeable. It’s not just about their charisma, they seem to have a way to get people of both opposite and same gender to be attracted to them. Is it their clothes? Or perhaps the way they handles their opinions? I aren’t sure about it but one thing for sure, they are hell good at manipulating your impressions of them.


#3 – Persuasiveness.

This is pretty obvious isn’t it? Great entrepreneur are extremely good salesman, not only can they sell their product to virtually anyone, they can also very good at selling their goals and vision to their employee. Entrepreneur are just great at persuading people to change their views and behaviour such that things become favourable to them. Sometime they are seriously so good at persuasion that they probably can sell sands to the Saudis Businessmen.


#4 – Social Adaptability.

Entrepreneur are social chameleon. They have this very unique ability to alter their personalities to suit different type social setting. For example, a college professor will definitely had a hard time making friends with your local bike gangsters. And neither would a local bike gangster communicate well with a thermodynamics professor. But apparently, great entrepreneur can switch their personalities and adapt in different social setting just fine.

These variables, especially social perception, seem to be the key to entrepreneurial success.


Also, the researcher apparently found that social perception seems to have a greater impact on entrepreneuring. And other than those 4 different social skills, entrepreneur tend to engage in radical ways of thinking. Like steve jobs who couldn’t accept facts and have a talent in arguing tirelessly against unfavourable facts. And they are usually more optimistic and have the tendency to generalize result to a larger sample based on data drawn from small experiments/samples

Now back to Robert. He claimed that intelligent is required to become a successful entrepreneur. He mentioned that conventional test aren’t capable of picking up these 3 different yet crucial types of intelligent. They are namely: creative intelligent, analytical intelligent and practical intelligent. And accordingly to Robert, great entrepreneur tend to be excel at those types of intelligence.


#1 – Creative Intelligence.

Yes. I know this sucks for some people but if you ever want to become an entrepreneur, you have to be constantly churning out new ideas. It could be a new product, a new way of doing things or a new way to sell an old boring product. But however, creative intelligent alone will not make you a great entrepreneur. People with high creative intelligent tend to become artist, musician and maybe film producer who always have new ideas on how to express themselves.


#2 – Analytical Intelligence

The next intelligence that comes next after creative intelligent is the ability to analyse situation well, crunch numbers and be able to say this with confidence ” this idea suck, this one’s good”. Great entrepreneur are incredibly creative people, they churn mass of great business ideas. However not all business ideas work and they have the ability to identify good and workable ideas quickly.

Else, they would be swarmed with so much ideas that they won’t know where to start and even if they do start, they are more likely to fail as they acted on unreasonable or unrealistic business ideas. Whereas people who become great entrepreneur are highly analytical and critical about business ideas that they churned out.  And they would leave no stone unturned when trying to figure out if a business ideas is workable or not.


#3 – Practical Intelligence

This is good news for you all because practical intelligence is not something you are born with. Anyone with the willingness to working hard can acquire high level of practical intelligence. Practical intelligence is basically all about your experience, your skill sets and your connections. Practical intelligence is all about turning ideas into reality.


Let say you are very creative person who managed to churn out many marketing ideas to sell a product online. And your superior analytical intelligence have helped you sort out one really great idea that will definitely succeed.

However, you will still be a loser unless you can turn that great idea into reality. And that’s where practical intelligence comes into play. You need to know some form of programming to code up a website, you need technical knowledge to manage the servers and have the connection to help you advertise your products. All these are about practical intelligence and the good news is: if you are willing to work hard, you can acquire huge amount of practical intelligent.

According to Robert, in order to become a great entrepreneur, you need to be great at these 3 different type of intelligence. If you only have creative intelligent, you would most probably end up as an artist. If you only have analytical intelligent, you would only do great as a backend staff who crunch numbers. And for people who have only practical intelligent, you will only become a very good repairman.

In conclusion, great entrepreneur are great because they have the creative intelligence to churn out many ideas. The analytical intelligent will help them to sort out the good ones and the practical intelligent to help them to turn those great ideas into reality. And apparently, these three types of intelligent aren’t well picked up by conventional IQ test, which means that those with very high IQ need not necessary have the abilities to be come an entrepreneur and makes boatload of money. But most of them would definitely make enough money to live comfortably.

About the author


Neuroscience have seen rapid progress over the past 2 decades thanks to new advances in brain imaging technology. Join me in our pursue to unlock the secrets of our brain. Email me: Ben [at]