Drawing from institutional economics, we study the role of individual and country-level determinants influencing the entrepreneurial intention of non-entrepreneurial individuals with perceived entrepreneurial skills. By employing a multilevel approach in a sample of 545,781 individuals for the period 2006–2013, we find that individual-level informal institutions (i.e. role model and fear of failure) affect the entrepreneurial potential. We also find that informal institutions across countries (i.e. media coverage and opportunity recognition) compensate for the lack of individual factors for those without entrepreneurial intentions. The findings suggest policy implications regarding educational programs to close the gap between skilled non- potential and skilled potential entrepreneurs.