This next section is a collection of knowledge, perceptions, and projections for charting a journey into entrepreneurship. The content here is intended to help individuals develop an entrepreneurial mindset, stress the importance of discipline and use of evidence, to encourage budding entrepreneurs to dig deeper and accurately assess risks before making any large commitments.
The topic of entrepreneurship is always an interesting and evolving discussion. There are as many views of entrepreneurship as there are business models and industry sectors, so it is important to keep up on current best practices to survive in the long run. There is no single correct method to pursue entrepreneurial ventures but there certainly are quicker, more efficient, and more disciplined methods that have much higher success rates.
Four prominent thinkers/writers in this space are Eric Reis (The Lean Start-Up), Alexander Osterwalder (Business Model Generation), Bill Aulet (Disciplined Entrepreneurship) and Steve Blank (The Start-Up Owner’s Manual). These authors have shared their methods to evaluate, start, and grow start-up ventures using clear, disciplined, structured, and data-based methods. Where a scientist has a very clear materials & method in an academic paper, these authors have tried to provide the same repeatability and structure to starting new ventures. For disciplined scientists interested in becoming an entrepreneur, this is a gift and much of their materials can be found online for free, for example most of the principles and methods developed by Steve Blank can be freely accessed at SteveBlank.com. However, if you are serious it would be prudent to invest and buy these books for your reference library.
In one of his most recent writings, The Class that Changed the Way Entrepreneurship is Taught, Blank makes the case for experiential learning in the article. The premise is that by accessing and using many of the tools that are available to entrepreneurs, regardless of their current environment, almost all budding entrepreneurs can gain the structured knowledge needed to successfully move toward a new business venture.
Innovation and entrepreneurship are two closely related words used in today’s global verbiage. Some may think those words mean the same thing, but using them interchangeably would be a mistake. They revolve around the same idea, but it is critical to understand the difference. Innovation is applying your creativity to solve a problem and implement a solution. Entrepreneurship is the activity of setting up a new business, and taking on financial risks to pursue a profit, create social impact or even create a new business from or within an existing business.
What is Entrepreneurship?
Entrepreneurship is the act of being an entrepreneur or “one who undertakes innovations, finance, and uses business acumen to transform innovations into economic goods”. This may result in new organizations or may be part of revitalizing mature organizations in response to a perceived opportunity or changing the target market. The most obvious form of entrepreneurship is that of starting a new business (referred to as a start-up company). When entrepreneurship is describing activities within a large organization it is often referred to as intrapreneurship.
An entrepreneur is defined as anyone who creates or organizes a new venture (often a start-up, but not always), then continues to be an active participant in the operation of that venture until it is stable and, ideally, self-sustaining. They learn continually in order to recognize opportunities with the potential for innovation. They use resources economically in order to create innovative products that deliver a competitive edge based on differentiation. Often, they are called “founders” and they are typically the first shareholder, usually maintaining the majority of the shares of the start-up company in its first few years. Simply put, an entrepreneur is anyone who launches and continues to run their own company. They bring together people (skills), products (or technology to build products or services), and financial assets (cash) to form a company aiming to solve a market problem that will generate revenue for the company
Characteristics of an Entrepreneur
Entrepreneurs are people who have a passion for creating change in the world. They need a certain set of skills or qualities to be effective leaders and innovators. According to Louis J. Filion (2021) successful entrepreneurs innovate by recognizing opportunities to make moderately risky decisions that lead to actions that require the efficient use of resources that contribute to added value.
Looking bit closer to home, successful Canadian entrepreneur, Arlene Dickenson, finds that successful entrepreneurs:
- Always question the status quo
- Think security is defined by being in charge of your own destiny
- Are doing something that makes them scared and excited each and everyday
- See opportunities where others do not and are always thinking “I thought of that years ago”
- Wake up in the middle of the night thinking about work in a good way, and
- Embrace the messiness of the entrepreneurial work/life balance
According to Gallup’s research, the best business-builders rely on a set of 10 key traits which help meet the demands of a start-up and lead them to success. Those traits are confidence, the ability to delegate, determination, disruptive thinking, independence, knowledge-seeking, profitability-focused, relationship builders, the ability to manage risks, and the ability to sell ideas. Gallup has developed an assessment, the Builder Profile 10, designed to identify a person’s dominant entrepreneurial traits, for a small fee. Many of these traits can be learned and certainly with discipline proven methods such as those described by Steve Blank and Eric Reis can be followed to improve any entrepreneur’s opportunity to succeed.
Contrary to popular media attention, the most successful entrepreneurs are middle aged or older, like Henry Ford, Vera Wang, and Martha Stewart. Research from Daniel Kim at Wharton notes that the most successful entrepreneurs in the USA are in their mid-40s. Why? Because they have much more life experience behind them that helps them make better decisions and to assess risks and opportunities more effectively. Older entrepreneurs have stronger social ties, established relationships with suppliers and potential hires as well as more financial wealth to contribute which can cushion a start-up during tough times. According to Daniel Kim, “there seems to be this very consistent finding that the likelihood of entrepreneurial success rises with age” (Kim, 2019). Entrepreneurs in their 20s have the lowest probability of creating a high-growth company. Examples like Bill Gates and Mark Zuckerberg are very much a rare anomaly.