- Oct 2020
Entrepreneurship is a Calculated Risk
Nowadays, entrepreneurship has become a career path to follow and it is more glorified around this guy who will jump off a cliff and then learn the way things are done. However, entrepreneurship does not work like that. Most successful entrepreneurs first understand the market potential of a good idea and then adopt a business model by taking calculated risks around it. Most people want to start a business because they are passionate about it. But true entrepreneurs are not like that. Entrepreneurs find the right idea for a business that fulfils their aspirations – primarily that of making money. You build passion for something that works for you because it’s worth it for you.
The Entrepreneurial StyleI meet different types of entrepreneurs in my work and they are broadly of three types:
- Adventurous Entrepreneurs: About 70% of those I meet are very adventurous. Without even looking at the business, without even thinking how it will work, they think they will make a lot of money out of it. For instance, there are many young people today who want to get started with this ‘great’ idea they have. I ask them, when will they start? They reply, in the next 2-3 months as soon as they get the first investment. What does the brand look like? We are working on it, they say. What is the goal? We want to sell the company within two years! What I find disturbing is that they are already thinking of selling something that they have not even started as yet. The success rate of such entrepreneurs is as low as 1-2%.
- Optimistic Entrepreneurs: I admire them the most. They locate a good idea, work on it and are aware that it will take a lot of effort to make it work. And they are willing to go the last mile for it. Their success rate is high – 80-90%.
- Realistic Entrepreneurs: They come with a different level of maturity and possess more of an investor approach. They look like big risk-takers but are actually very conservative and are always looking out for more than 20% return on investment. They are passive entrepreneurs who bring the money and partner with operators.
Lifecycle of an EntrepreneurAnother area I would like to touch upon is the lifecycle of an entrepreneur. If you want to become an entrepreneur or engage in a startup, here are the three things that you would need to know:
- Building a Brand: People buy brands. I have seen a lot of businesses where the idea was vague but they created a brand around it and it worked. In today’s world of social media, it is equally important to build your personal brand along with that of your company.
- Building an Inner Circle: It is crucial to build an inner circle comprising your partners, franchisees, investors, employees, etc. To begin with, it could be only 2-3 people who would compliment you in your business journey.
- Work towards Early Success: If you are a young entrepreneur, everybody keeps an eye on you and more often than not you will hear about failure. Early success is most important to keep you going and also to demonstrate to yourself and the world that you can do it.
Most brands are in a hurry to spread their reach by taking franchisees on board. The aim here is to maximise profits…