We’re wrapping up a series on evaluating whether the concept of business ownership is right for you. Most recently we’ve discussed how to assess your risk tolerance by analyzing the way you think. We’ve covered the 3 main ways to earn income, outlined the risks associated with employment and franchise ownership, and how each personality type typically thinks. If you didn’t identify with either of those, then maybe you’re an entrepreneur at heart.
Entrepreneurial Business Ownership
Entrepreneur think is:
How can I meet the needs of my customers by profitably solving the problems they have?
If you want to chart your own course, solve all your own problems, be captain of your own ship, be totally responsible for whatever success or failure comes, and chafe at the thought of working for someone else in return for less risk, then you probably have the entrepreneurial bug.
Being an independent business owner is a high risk proposition with a high probability of first time failure.
Why high risk? Because you will most likely pledge every asset, such as home equity, savings, 401(k), etc., that you have to finance startup or purchase of the business. If your venture fails, you may very well lose everything you’ve spent or offered as collateral. (This is also true for franchise owners.)
Why a high probability for failure? Because first time entrepreneurs have such a clear vision of what they want to do and how to do it; they think they know everything! I have several colleagues who generally refuse to work with first time entrepreneurs because (in their words) “they think they know more than I do and helpful suggestions that I make are either ignored or become implementation battles.” Truer words were never spoken.
If your risk temperament is right in line with the type of person I’m describing and you want to go forward, then how can you improve your chances of success? Buck the trend by getting lots of experienced advice and counsel from those who have gone before! Be willing to listen to those who have graduated from the school of hard knocks and learn from their mistakes to avoid making them all again yourself, because you simply don’t have either the time or the money to survive the experience of learning it all firsthand.
We’ll wrap up this series in part 7 by outlining why businesses generally succeed or fail, and I’ll suggest some more reading resources and offer some advice on how to navigate a path to success.