I’ve heard a lot of great business ideas lately — and more than a few people announcing that now is the right time to go into business for yourself. I think that there’s a lot to be said for becoming an entrepreneur during a down economy — although the risks definitely go up. With your own business, especially if you hold on to your day job as long as possible, you’ve got more flexibility if you get a pink slip. But starting your own business is certainly not for everyone. There are certain characteristics that can significantly improve the odds of succeeding as an entrepreneur. Without these characteristics, though, it’s hard to do well even with the best of business ideas.
- Discipline: Plenty of business experts claim that you can’t get anywhere as an entrepreneur without vision or creativity, but that’s simply not the truth. Instead, the one quality that no entrepreneur can be successful without is discipline. To build an idea into a business, you have to have the discipline to spend time slogging through the least fun parts of running a business (like the bookkeeping), rather than taking that time to do something fun. When you’re the boss, there’s no one to keep you at work except yourself — and there’s no short-term consequences for skipping out early. Sure, if an entrepreneur plays hooky enough he knows that the business just won’t happen, but it’s very hard to convince someone that ‘just this once’ won’t hurt (and to keep ‘just this once’ from becoming a daily occurrence).
- Calm: Things go wrong when you run your own business. Most entrepreneurs go through crises with their businesses — and more than a few wind up with outright failures on their hands. But when you’re responsible for a business, you have to be able to keep calm in any situation. Any other reaction — whether you lose your temper or get flustered — compounds the problem. Instead, a good entrepreneur must have the ability to keep his cool in an emergency or crisis. It may not make the problem easier to solve, but it certainly won’t make it harder. If an entrepreneur can handle failure without frustration or anger, he can move past it to find success.
- Attention to Detail: Restricting your attention to the big picture can be even more problematic than ‘sweating the small stuff.’ As an entrepreneur, unless venture capital has magically dropped out of the sky, a small expense can be a killer. It’s attention to detail that can make a small business successful when it has competition and it’s attention to detail that can keep costs down. Attention to detail can be difficult to maintain — going over ledgers can be tedious even when you aren’t trying to pay close attention — but keeping your eye on a long-term vision is just asking for a problem to sneak in under a radar. After a business grows, an entrepreneur might be able to hire someone to worry about the details. In the beginning, though, only one person can take responsibility for the details.
- Risk Tolerance: No entrepreneur has a sure thing, no matter how much money he stands to earn on a given product. Even if a product tests well, the market can change, the warehouse can burn down and a whole slew of other misfortune can befall a small business. It’s absolutely risky to run a business of your own and while you can get some insurance, it’s not like most investment options. Even worse, if something does go wrong, it’s the entrepreneur’s responsibility — no matter the actual cause. In order to deal with all of that without developing an ulcer, you have to have a good tolerance for risk. You don’t need to channel your inner frat boy and take on absolutely stupid risks, but you need to know just how much you can afford to risk — and get a good idea of how likely you are to lose it. If the numbers make you uncomfortable, the risk is too great. An entrepreneur has to be willing to accept pretty big risks, with some level of comfort.
- Balance: You can take any characteristic too far. There’s a point at which attention to detail can become obsession or calm can become unemotional response. As an entrepreneur, you have to be able to balance your characteristics, getting the most of them without going over the edge. But balance for an entrepreneur goes far beyond keeping your characteristics in check, though. Just as an entrepreneur doesn’t have a boss to keep him at work when necessary, he doesn’t have one to send him home when he’s done. If you are working for yourself, you have to decide how to balance your work and home life — and if you have a day job to add into the equation, balance just gets more complicated.
The characteristics I’ve listed below are not characteristics that a person is born with. Some people do seem to have an aptitude for those qualities that make up the entrepreneurial spirit — but they can be learned. They aren’t the easiest things to learn, admittedly, but it’s not impossible. You won’t find classes in these subjects, but you can teach yourself, if you truly want to.
Are there any other characteristics you think are necessary? Share them in the comments and tell us why you think a particular characteristic is crucial to an entrepreneur’s success.