Adonis Diaries

Posts Tagged ‘Entrepreneurship

The four elements of entrepreneurship

Are successful entrepreneurs made or born?

Entrepreneurial behavior isn’t about scale, it’s about a desire for a certain kind of journey

We’d need to start with an understanding of what an entrepreneur is. They’re all over the map, which makes the question particularly difficult to navigate.

There’s the 14-year-old girl who hitches a ride to Costco, buys 100 bottles of water for thirty cents each, then sells them at the beach for a dollar a pop. Scale that that every day for a summer and you can pay for college.

Or the 7-time venture-backed software geek who finds a niche, gets some funding, builds it out with a trusted team, sells it for $100 million in stock and then starts again.

Perhaps we’re talking about a non-profit entrepreneur, a woman who builds a useful asset, finds a scalable source of funding and changes the world as she does.

The mistake that’s easy to make is based in language. We say, “she’s an entrepreneur,” when we should be saying, “she’s acting like an entrepreneur.

Since entrepreneurship is a verb, an action, a posture… then of course, it’s a choice. You might not want to act like one, but if you can model behavior, you can act like one.

And what do people do when they’re acting like entrepreneurs?

1. They make decisions.

2. They invest in activities and assets that aren’t a sure thing.

3. They persuade others to support a mission with a non-guaranteed outcome.

4. This one is the most amorphous, the most difficult to pin down and thus the juiciest: They embrace (instead of run from) the work of doing things that might not work.

As far as I can tell, that’s it. Everything else you can hire.

Buying into an existing business by buying a franchise, to pick one example–there’s very little of any of the four elements of entrepreneurial behavior.

Yes, you’re swinging for a bigger win, you’re investing risk capital, you’re going outside the traditional mainstream. But what you’re doing is buying a proven business, not acting like an entrepreneur. The four elements aren’t really there. It’s a process instead. Nothing wrong with that.

All four of these elements are unnatural to most folks. Particularly if you were good at school, you’re not good at this. No right answers, no multiple choice, no findable bounds.

It’s easy to get hung up on the “risk taking” part of it, but if you’re acting like an entrepreneur, you don’t feel like you’re taking a huge risk.

Risks are what happens at a casino, where you have little control over the outcome.

People acting like entrepreneurs, however, feel as though the four most important elements of their work (see above) are well within their control.

If you’re hoping someone can hand you a Dummies guide, giving you the quick steps, the guaranteed method, the way to turn this process into a job–well, you’ve just announced that you don’t feel like acting like an entrepreneur.

But before you walk away from it, give it a try.

Entrepreneurial behavior isn’t about scale, it’s about a desire for a certain kind of journey.

Only 12 words to define Entrepreneurship?

BILL MURPHY JR updated on April 24, 2014

There’s a definition of entrepreneurship that has changed how I think about the way people choose their paths in life. It helped me to build a thriving business and find all kinds of great new experiences. Heck, it even helped me to meet my wife.

I believe it can have the same kind of positive impact for you, if you’re willing to try to put it into practice:

Entrepreneurship is the pursuit of opportunity without regard to resources currently controlled.

That’s the 12-word definition of entrepreneurship that they teach at Harvard Business School.

I first read it while researching my 2010 book, The Intelligent Entrepreneur

I remember staring at it on the page and feeling like a boy noticing girls for the first time: There’s something really interesting here, but I know there’s a lot more to it than I currently understand.

I’d like to break the definition down for you, because it not only gives insight into why people like you are so drawn to the idea of starting and building something, it will also improve the likelihood that you’ll be successful.

(As a quick aside, seeing that definition in another of my books is what originally led me to meet Inc.’s editor-in-chief, Eric Schurenberg. A column he wrote about it became the most-read article in the history of Inc.com at that time.)

1. “Entrepreneurship…”

Let’s start with the word itself: Entrepreneurship. A noun with few true synonyms. (that lack of real synonyms can be a real pain in the neck.) It’s not simply a matter of being a boss or a leader or owning a business. In fact, there’s nothing intrinsic at all in this definition about business, or risk, or even making money. It’s something different–a way of looking at the world.

2. “…is the pursuit of opportunity…”

There are two key words here: pursuit and opportunity.

“Pursuit” means there has to be action involved (hence, my reader-inspired decision this year to change the name of my column to Action Required). You have to have impact; you have to try to change something. Simply thinking about an idea doesn’t cut it, and neither does coasting along doing what you’ve always done.

Similarly, a true entrepreneur is always pursuing “opportunity.” That means something new, bigger, nicer, better, smarter, more useful.

it often also means pursuing the most amazing, appealing, enticing opportunities you can find.

Here’s where we really start to differentiate true entrepreneurs from everyone else.

There are a lot of good people out there running very nice businesses. However, if they’re not chasing new opportunities–if they’re coasting along, doing what they’ve always done–then maybe they’ve given up the mantle of true entrepreneurship.

3. “…without regard to resources currently controlled.”

This might just be my favorite phrase in the world. I suppose if Harvard Business School had wanted to make the definition more accessible, they could have said “regardless of” instead of “without regard to,” but no matter.

“Without regard to resources currently controlled” means it doesn’t matter how little you have at the start. It doesn’t matter that you don’t have money, or that you don’t have all the required skills, or that you don’t have a team to help you.

At the very beginning especially, reach for the stars. Don’t let the opportunities you pursue be limited by the assets you currently have. Instead, let the attractiveness of the opportunity serve as your guide.

There are so many implications of this part of the definition.

For one thing, while capital is a necessary ingredient, the truth is that all of those would-be entrepreneurs out there who blame a lack of money for their inability to get started are playing the wrong game.

there’s an advantage to not having money at the start, because that scarcity forces you to be more resourceful. It means you have to sell your ideas to others–a possibly painful exercise, but one that pays huge dividends in the long run.

Here’s the bottom line: For just about any decision you have to make in life, there are two ways to make choices.

Most people choose the first method of decision making. They look at the array of options that seem reasonably attainable, and then pick the best one. They choose a career because it’s what their parents advised, or because there are jobs available. They live somewhere because it’s what they’re familiar with. They surround themselves with the kinds of people they’ve always known.

The true entrepreneur, however, sees things differently.

Instead of choosing the best available option, he or she thinks big, and tries to identify the best possible solution, regardless of whether it seems completely implausible and unattainable. Then, he or she gets to work, trying to make that impossible dream a reality.

If you choose the first path, you might save yourself a lot of heartache, and a lot of ups and downs on the roller coaster of life. However, you also run a greater risk of achieving your goals only to find you didn’t push yourself enough. Which path will you choose?

BILL MURPHY JR. is a journalist, ghostwriter, and entrepreneur. He is the author ofBreakthrough Entrepreneurship (with Jon Burgstone) and is a former reporter for The Washington Post. @BillMurphyJr


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