Entrepreneurs..... Myths and Realities

Myth 1 - Entrepreneurs are risk takers

Reality: They do take calculated risks but spend a great deal of time and energy trying to minimise the risks.

Myth 2 - Entrepreneurs are born not made

Reality: They often serve an apprenticeship acquiring skills, contacts and experiences often over 10 years to enable them to start their business. This is purposeful practice.

Myth 3 - Raising money from the bank is the biggest blockage

Reality: 80% of start up capital is from personal savings, 30% from family and friends and only 15% from banks.

Myth 4 - Any good idea can be turned into a successful business

Reality: Entrepreneurs understand the difference between an idea - something they are passionate about - and an opportunity - something which solves a customer problem.

Myth 5 - Starting a business is risky and often ends in failure

Reality: Most businesses that end simply cease trading, they do not fail. Less than 2% actually go bankrupt.

Myth 6 - Entrepreneurs are egotistical, independent and want to be their own masters

Reality: Entrepreneurs are egotistical, independent and want to be their own masters!

There, entrepreneurial myths, sorted!

Building your Business's Capability

The three key drivers of entrepreneurship are creating opportunities, marshalling resources and building capability. In this blog I want to focus on building the capability of a business.

The job of the CEO or owner is to set the strategy and pick the people capable of delivering it. Getting the right people on the bus is step 1 in building capability yet it is one which appears to be a problem.

The issue is that too often people are appointed to key roles without the skills, experience or drive to deliver, primarily because they are low cost but actually a low cost resource in a key role who cannot deliver is a false economy. It is why small businesses stay small, they do not have the capabilities to grow.

The second step in building capability is to design a preferred culture - the way you want things done here. You get a culture whether you want one or not but if you don't design it you will get one by default - usually one you don't want! (This is worthy of a separate blog).

Finally, you need to operate as a learning organisation and ensure that learnings are built into your business practices and routines. Whenever you do anything you get one of two outcomes; success or learning, and in growing businesses learnings should be viewed as valuable assetts.

There, building capabilities, done!

Perception isn't Everything......

We all kind of assume our view of the world is factual and right. "This is how it is, don't confuse me with the facts" as one client told me.

A guy called George Kelly developed a idea called Construct Theory - "we all construe the world in our own unique and idiosyncratic way but it is only one view, other people have their views which they believe also to be right".

We then screen out any information which contradicts our view which makes us uncomfortable and select information which confirms it - pat on the back!

Why am I telling you this and why does it matter? Well imagine if your doctor had their view of how to cure you and it was wrong?

The solutions are to get the facts as far as possible and make fact founded decisions rather than decisions based on your view or prejudices which may or may not be correct. Secondly, try to understand other people's views on issues. One of the features of Bill Clinton's leadership it was said was that he could take into account several different perspectives at once and still function effectively.

So in business seek views from customers, employees and investors, keep up to date with current thinking and build this into your plans, which should help you validate your perceptions.