The Pygmalion Effect: How Expectations Shape Performance in Teams and Startups
- Natalia Parrado
- Jan 19
- 2 min read
January 19, 2026 - The expectations that leaders and founders project onto their teams directly influence performance. This psychological phenomenon, known as the Pygmalion Effect, is key in leadership and early-stage company growth.
The Pygmalion Effect
What is the Pygmalion Effect?
In psychology, the Pygmalion Effect describes how the expectations we place on others shape their behavior and performance. When a leader genuinely believes in someone’s ability, that person tends to stretch further, take on new challenges, and raise their level of execution. When the opposite happens, low expectations, micromanagement, or distrust, performance tends to adjust downward.
A Brief History
The concept was popularized in 1968 by psychologists Robert Rosenthal and Lenore Jacobson, who demonstrated through a school experiment that teachers’ expectations influenced students’ academic performance. Those labeled as “high potential,” even arbitrarily, ended up performing better. The finding opened the door to understanding how an observer’s beliefs can alter the behavior of the observed, creating self-fulfilling prophecies.
The name comes from the classical myth of Pygmalion. According to the legend, Pygmalion was a sculptor who created a female statue so perfect that he fell in love with it. The goddess Aphrodite, moved by the intensity of his desire, granted his request and brought the sculpture to life. The myth represents the power of expectation and the ideal: what is imagined possible eventually takes shape.
Today, this bridge between myth and psychology helps explain a central phenomenon in leadership: expectations not only describe the future, they contribute to building it.
Pygmalion in the Startup Context
In business, the phenomenon becomes especially visible in early-stage environments: young teams, flexible roles, high uncertainty, and accelerated learning. Here, the founder’s expectations become a strategic asset.
A simple “I trust you, you’ve got this” has measurable impact on:
Motivation
Speed of implementation
Autonomy
Learning capacity
Ownership and responsibility
Startups that scale quickly tend to combine capital, market, and strategy… but also cultures where people are expected to grow faster than the environment around them.
The Internal Pygmalion: Expectations Toward Oneself
An interesting layer of the model is that it not only operates outward, it also works inward. A founder who believes they can open a new market, build a product, or establish a solid brand increases the probability of making it happen. This is not naive optimism; it’s expectation as a mechanism that activates action, consistency, and resilience.
Internal narratives define the kinds of problems we are willing to face. A “I don’t think I can” closes paths; a “I can’t yet” keeps learning open.
How to Apply the Pygmalion Effect in Your Venture
1. Set clear and high expectations
Clarity reduces friction; high expectations mobilize internal resources.
2. Pair expectations with tools, feedback, and trust
Expectations without support create frustration; expectations with support generate growth.
3. Celebrate visible progress
Reinforce progress, not just final outcomes.
4. Identify limiting internal narratives
What goes unquestioned tends to repeat itself.
5. Replace “can’t” with “not yet”
“Yet” opens the door to growth.
Designing Cultures of Positive Expectation
Creating cultures where people are expected to perform at their best is not romanticizing work, it’s designing environments where talent can actually flourish. Properly applied, the Pygmalion Effect doesn’t deny difficulty; it sustains the possibility of expansion.
Natalia Parrado
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