Today, being an entrepreneur is a pretty hip thing to be. We hear stories with regularity about disruptive innovators, kidpreneurs making millions before they can drive a car, and humble stay at home parents leveraging their brilliant ideas to bring hoards of cash rolling in.
The sheer preponderance of these stories makes it seem almost too easy. Unfortunately, for most, the entrepreneurial house they are building might be flawed from its basic foundation as shown by some stark numbers that we don't talk about nearly as much.
According to the Small Business Administration, 66% of new businesses survive into their second year and only 50% survive until their fifth year. In other words, over half of new entrepreneurial ventures are here today and gone within five years.
Those that survive might be paying attention to two critical things that are easily overlooked with all the hype out there.
Why Are You Really Doing It?
The foundation of a successful entrepreneurial venture is having a strong and compelling "why" that fuels you. This concept may seem almost rudimentary. Unfortunately, though, many people who want to be entrepreneurs have a shaky foundation to begin with because they simply don't have a strong enough "why."
I talk to a lot of colleagues who want to start their own thing and want to know how I have done it so far. I usually start with the humble truth:
"I have no idea how I've done this for eight years successfully..."
Then I ask them why they want to start their own thing. I can usually tell right away who is going to make this work for the long term and who won't get there. I hear a lot of answers like:
"I want to be my own boss."
"I've got a great idea."
"I want to make a ton of money."
"I want flexibility."
Those answers are popular but are not built on a lot of solid ground. Having a good "why" is a critical first step that needs to be so compelling that it will serve as your fuel during the times of adversity.
I've run my business for eight years now and have had both expected and unexpected adversity. If I didn't have a really compelling reason why I was doing this, it would be easy to make my entrepreneurial venture a fly by night thing and move on to the next thing.
Beyond The Why Is Knowing Yourself
If there is one thing I've learned on my own journey, it is that this is a challenging path to be on riddled with both adventure and lots of risk. I asked myself lots of questions about just how strong my mental wherewithal was to handle the roller coaster before getting on the ride.
I've learned just how critical it is for any aspiring entrepreneur to also truly know themselves and have an honest self-assessment. If you are faint of heart, then entrepreneurialism might not be your thing and you might reconsider your path. As my dad and business mentor always used to tell me:
"No matter how pretty the horse is, you still have to clean up the barn."
There is a lot of barn cleaning with being an entrepreneur. It's not all glamorous pitch meetings and angel funding.
Before I started my own venture, I talked to another great mentor of mine, Jim Hazboun, a top C-Level executive at a large global company as well as serial entrepreneur. He is a highly sought after mentor and advisor, so I had to compete with lots of other people to get his time, but it was well worth it.
According to Jim, a lack of honest self-assessment is one of the root causes for entrepreneurial failure. Hazboun told me:
"Many are inspired by the dream but few are prepared for the reality of starting their own business. It's like going to war. Don't do it lightly. You have to be prepared, have the right strategy, resources, and creativity to address unforeseen obstacle. But more than anything, you need fortitude."
Hazboun suggests that as you go through your self-assessment, consider some other attributes that may predict future success. The best entrepreneurs he has experienced had passion, drive, people skills (EQ) and humility. They were continuously learning and had strong problem solving skills. Lastly, they knew how to sell themselves and their ideas, but they were also strong operators who could deliver results.
"Of course, very few entrepreneurs are great at everything..."
"Knowing your weaknesses might be more important than knowing your strengths, and partnering with people to help compensate for those weaknesses is the key."
So before taking the leap, think about why you want to jump, whether it is a solid enough reason to carry you through the entrepreneurial gauntlet, and just how well you know your own strengths and gaps that will be important on the journey.
I know it helped me before I dove into the pool.