- The only sustainable way to create lasting wealth is through enterprise in entrepreneurship.
- No country can survive without a thriving breed of entrepreneurs.
- Not everyone is made to be an entrepreneur.
“It is glorious to be rich.”
These are the words of the former Premier of China, Deng Xiaoping. They marked the change of policy direction of the country from being a purely communist state to one that embraced more western capitalistic ideology.
I agree with the words of the former Premier. It is indeed glorious to be rich and to create a lasting financial fortune and estate. I am not the only one that agrees. Even popular culture does.
This message is being sold with aggression akin to that of being on steroids—think Donald Trump and the Apprentice, Richard Branson and the Virgin Group, Dan Lok and his famed FU Money. All these characters have in varying degrees made it cool to make a lot of money. And it is.
The only sustainable way to create lasting wealth is through enterprise and more specifically through entrepreneurship.
Entrepreneurs are catalysts for business.
They have a highly desirable and fundamental effect on the wider economy through establishing new businesses of providing not only goods and services to customers but also providing job opportunities to individuals in various industries.
No country can survive without a thriving breed of entrepreneurs! They literally keep the wheels of the economy turning through their activities.
Entrepreneurship is a critical solution according to Nieman (2003) to low economic growth, high unemployment, and unsatisfactory levels of poverty especially in countries like South Africa and Zimbabwe.
It is not difficult to see that entrepreneurs are clearly are an important commodity, so what then does it take to become one and can anyone become an entrepreneur? Is there a template against which a person can match himself or herself to gauge how they would fare as an entrepreneur?
Before we take a hard look at what it takes to be an entrepreneur it is essential to distinguish between genuine entrepreneurs and entrepreneurial tendencies. Taking the metaphor of art, people with artistic tendencies will visit museums and galleries, attend auctions, and collect artefacts and even go to arts and crafts classes. However, there are few people who have the necessary combination of creativity, talent, and persistence to call themselves artists. In a similar fashion one can distinguish between natural entrepreneurs and people with entrepreneurial tendencies.
SO, ARE YOU AN ENTREPRENEUR OR NOT?
Not everyone is made for the fast lane or born to be a hustler so to speak. I am also not suggesting that the hustler is the same as an entrepreneur. The genuine entrepreneur will possess the following characteristics:
- Very high levels of energy and passion: this is the most prominent feature of the quintessential entrepreneur. This band of people tends to get up early in the mornings and they hate to stay late or to sleep in. They tend to be enthusiastic people who realize that the only thing more contagious than enthusiasm is the lack of it. This very high level of energy stems from their passion. If people are to successfully start and venture on this journey, they must preferably pursue business activities for which they have a passion because they are much more likely to succeed in businesses they are passionate about.
- Locus of control: entrepreneurs typically are people who like to be in control and have good delegating skills. They have a high degree of autonomy and do not like to be told what to do by someone else. This comes from their natural desire that these individuals must oversee their lives and one way of ensuring this is by being in control of one’s own venture. In short entrepreneurs have a strong desire for independence.
- A very keen interest in money: entrepreneurs love money (like the author). They love to make it and love having it (again like the author). A typical candidate for entrepreneurship will have had jobs in their childhood and understanding the nature of the value of money and how to use it as a resource. Bill Gates for example started his business at the age of 16 and was filing company tax returns by the time he was 18. Warren Buffett had several newspaper routes when he was still a young boy and Carlos Slim Helu is said to have bought his first stock by the time he was 12.
- A deep desire for and need for achievement: this is one of the crudest motivations that drives entrepreneurs to excel. Entrepreneurs have a great need for achievement compared with individuals who are not entrepreneurially inclined. This breed of people is made up of self-starters who are driven internally by a strong desire to compete against self-imposed standards and to attain challenging goals.
- Risk-taking and uncertainty: entrepreneurs thrive on and are famous for their risk-taking ability. They usually operate on stretched resources especially in the early stages of whatever ventures they pursue yet still manage to carry out a realistic evaluation of risks. Additionally, they establish a position where the risk is limited, and the reward is substantial. This readiness to take risks involves being prepared to make use of opportunities even if there is a possibility of financial loss. Successful entrepreneurs do not take chances. It is very important to make this distinction but take calculated risks. They will from time to time avoid opportunities where there is a high probability of failure regardless of the reward involved. In short, to be an entrepreneur and a successful one, in the long run, requires you to be a very good risk manager and the only way to be adept at managing risks is to be absolutely consummate about the ventures you get into.
- Creativity and innovation: entrepreneurs have a creative attitude towards obstacles. It needs little mention to know that business, especially starting one and growing one, is never a straightforward and linear affair. Things can and will certainly go wrong every now and again. When faced with obstacles the typical entrepreneur will find new ways of overcoming them. It is believed that every person has the capability to be creative. It is a matter of how individuals develop that creativity within them to produce the most favourable results. Creativity simply involves new ideas and new thinking around adjusting or refining of existing procedures or products, the identifying of opportunities and solutions to problems. Innovation and creativity are the necessary fuel to sustain an entrepreneur’s venture. To further stress the importance of this concept in the long term the success of an enterprise is determined by the degree to which good ideas are generated, developed, and implemented. Creativity requires that people be open to new ideas and approaches to business and focus on what can be done differently to ensure the success of the enterprise.
- Determination and persistence: this no doubt emanates from having a strong positive mental attitude. Optimistic tenacity is a must, given the tendency in business for things to go wrong before they become right. It requires perseverance to succeed in business and entrepreneurs who have a positive attitude towards their enterprise believe in their business despite setbacks they encounter and are prepared to persevere in their efforts to ensure success. Perseverance and drive are therefore very closely related. All large businesses started off as small enterprises. The Ford Motor Company started in Henry Ford’s garage and Ford persevered despite many setbacks and problems because he believed in his product and as a result, he finally achieved success. Determination and energy are part of what it means to persevere. They are the ability of entrepreneurs to strive after their business ideas despite problems, obstacles and setbacks. Individuals who are true entrepreneurs are born with this skill or trait of intuition that makes it possible for them to persevere. It is overcoming the challenge of the unknown that motivated entrepreneurs.
- Commitment: this is the willingness of entrepreneurs to commit their personal resources to the business. This willingness also serves as an indicator of the level of confidence that entrepreneurs have in their business. It stands to reason therefore that to succeed as an entrepreneur you need to be hands-on. A high potential enterprise cannot be developed and established part-time. It requires total commitment and involvement. This is especially important because in my various consulting engagements I have dealt with several businesspeople who believed that they could set up and run ventures remotely without their active participation. It is also needless to say that many of them never got off the ground. Commitment requires that entrepreneurs make personal sacrifices and apply extraordinary efforts to deal with a task.
- The ability to convince financiers and raise capital: This is an absolute requirement. The entrepreneur must be able to convince providers of capital whether they are banks, finance companies or venture capitalists to buy into his or her vision and supply capital to the venture. The entrepreneur, therefore, needs to be persuasive in speaking the language that financiers understand and present their ventures as compelling investment case. The importance of this skill set cannot be overemphasized because as mentioned earlier financiers are the suppliers of capital which in many cases entrepreneurs lack. It makes it invaluable to be able to engage effectively with this group of people. This point is best captured and has been made popular by the now world-famous reality TV show Dragons Den. Entrepreneurs engage financiers effectively by being excellent communicators as well as having an excellent understanding of the numbers or financials of the business. A business person needs to understand the principles of accounting. You need not be an expert, but working knowledge is essential. You must at the very least be able to read and analyse accounts.
- Leadership: John C. Maxwell’s maxim rings true every time and, in this instance, especially: “everything rises and falls on leadership”. You may start your venture on your own and operate it as a one-man business for some time but as the venture grows more and more people will join you giving rise to the need to develop leadership ability. Leadership ability is critical to be comfortable with people and to have good personal interactions, to confront problems, to be amenable to differences in opinion, to trust people and to give recognition where it is deserved. All these factors place a demand on the entrepreneur to become leaders in their ventures. Leadership in an enterprise can be compared with a musical conductor’s task. The conductor must select the right music to play for the audience. His hearing must be well developed to identify the best musicians for each instrument and it must also be his job to get all the players to play together so that the music sounds like it is coming from a single entity.
- Good human relations: successful entrepreneurs will very often be team builders. This ability naturally will flow out of their leadership ability. They let people feel worthy by giving them responsibility and credit for what they have achieved. They should know how to work with people and motivate them. Entrepreneurs must also know how to build a comprehensive network of contacts they know will be useful in the future. A very important point to note is that the successful entrepreneur realises the importance of business relationships. They will strive to have good relations with clients and suppliers seeing long term goodwill as more important than short term benefits. In short, they see things to do with business in terms of the big picture.
The foregoing has been a summary list of what the makeup of a successful entrepreneur looks like. It is by no means exhaustive. Further inquiry by way of research and study will certainly bring other qualities not included in this article to the fore. If you are an entrepreneur by nature you would have been able to identify most of the qualities and traits described.
If you did not, do not despair because while not everyone is born an entrepreneur, those that are not can learn and implement what it takes to be a successful entrepreneur.
To start and successfully run an enterprise requires more than just the makeup and traits of an entrepreneur. The point to note here is that the traits in and of themselves will count for very little if the individual who possesses them does not, first of all, take action in setting up the business venture and does not develop the managerial success factors required to run a successful enterprise.
Entrepreneurs running high potential ventures need to be effective in the following managerial areas in addition to having the previously described traits:
- Knowledge of competitors.
- Market orientation.
- Client service.
- Financial insight and management.
- Business savvy.
- Knowing when to engage experts.
The truly astute entrepreneur will be able to marry their entrepreneurial traits together with management competencies in order to become successful on a lasting basis.
Go forth and prosper!
- Golis C. (1998), Enterprise & Venture Capital, An investor and Business Builder’s Handbook, Allen & Unwin;
- Nieman et al. (2003), Entrepreneurship, A South African Perspective, Van Schaik Publishers