Learning from failure: do narcissists learn?

We investigate the narcissists' response to failure and whether narcissists effectively learn from this negative experience. To address this, we leverage data from a leading crowdfunding platform, and analyze 116,981 failed crowdfunding attempts. Our analysis shows a positive relationship between narcissism and the probability of relaunching which is negatively moderated by the degree of failure. Indeed, due to their fragility, narcissistic entrepreneurs are more likely to engage in ego-defensive behavior, and thus, they are less likely to relaunch following high degrees of failure. Moreover, narcissistic entrepreneurs exhibit poorer performance in their subsequent endeavors. This underperformance is driven by external attribution of failure and lower levels of pro-activity. In fact, following failure, narcissistic entrepreneurs are less likely to change internal factors that might contribute to their previous failure and they are more likely to respond to failure by reattempting in a different context. Managerial and policy implications are discussed. Most entrepreneurs rethink their decisions when their actions have resulted in undesirable outcomes. It seems natural to learn from failures: what should I have done differently? Not narcissists horizontal ellipsis Their refrain becomes "No one could have seen this coming! I must try again." Using collected data from 161,114 failed crowdfunding projects, we determine the entrepreneurs' degree of narcissism, and show that narcissists are more likely to relaunch projects following failure, unless the failure is too big. Also, when relaunching a crowdfunding project, narcissists will tend to switch industries, rather than adjust (more rewards, lower goals, or media usage) their projects because of learning. In adapting to dynamic environmental changes, learning from failure is vital and we show how entrepreneurs bounce back from setbacks. Being more aware of their narcissism, the entrepreneurs, and also the investors, could be encouraged to better adjust their responses to failure.