What Can We Learn from Unsuccessful Entrepreneurs? Everything!
You’ll often hear people talk about what it takes to become a successful entrepreneur. But what about those that are remarkably unsuccessful in business? I’ve learned that we can discover more from personal failings, and that of others, than we can from success.
So, here’s a look at seven ways to assure your entrepreneurship demise and why you should avoid these behaviors at all costs:
Start ten businesses, all at once.
Unless you lead a startup studio, focus is paramount. “In 1971, renowned social scientist Herbert Simon observed, ‘What information consumes is rather obvious: it consumes the attention of its recipients. Hence a wealth of information creates a poverty of attention’”. (Source: 99U)
I recently met a would-be entrepreneur who was convinced he should start four or five companies, simultaneously, to minimize the odds of failure. While it seemed like a logical fail-safe plan to him, successful entrepreneurs know differently. Harvard Business Reviewcontributor, Tony Schwartz explains why spreading your attention too thin is costly.
“The biggest cost — assuming you don’t crash — is to your productivity. In part, that’s a simple consequence of splitting your attention, so that you’re partially engaged in multiple activities but rarely fully engaged in any one. In part, it’s because when you switch away from a primary task to do something else, you’re increasing the time it takes to finish that task by an average of 25 percent.”
But what about serial entrepreneurs? The truth is this: every entrepreneur realizes the importance of focusing on one idea to bring it to fruition. Serial entrepreneurship is about leveraging your core capabilities, empowering others, and recognizing other business opportunities as they come. Simple wisdom is this: before you attempt to start ten companies – get at least one right first.
One of the single greatest lessons entrepreneurship has taught me is self-discipline. To be honest, while I excelled at many things … discipline wasn’t as high on the list as I once thought. Starting a business requires immense discipline – dare I say, above the norm of what most consider discipline.
By definition, it is the ability to control one’s feelings and overcome one’s weaknesses; the ability to pursue what one thinks is right despite temptations to abandon it. According to Forbes, studies indicate that “people with high self control are happier than those without … These people spent less time debating whether to indulge in behaviors detrimental to their health, and were able to make positive decisions more easily. [They] did not allow their choices to be dictated by impulses or feelings. Instead, they made informed, rational decisions on a daily basis without feeling overly stressed or upset.”
When you are building a company you have to discipline yourself to accomplish the task at hand, even when enthusiasm wanes. You’ll require self discipline to work while the world sleeps and wake when you’d rather sleep in. More importantly, you will need the discipline to execute on a vision that no one else sees but you. If you want to be completely unremarkable in business, don’t discipline yourself — not one iota.
Keep talking and do nothing.
It’s easy to get excited about your venture and tell the world. But have you ever met that one ‘entrepreneur’ that is always about to do something … yet never does? Of course, we all have. And the truth is, he (or she) hasn’t yet learned the power of making more moves and less announcements.
You can only talk about something so much until you literally talk yourself out of it. Meanwhile, your chatty, albeit witty banter may be directed at the wrong people, which yields less than desirable feedback. And before you know it, they are talking you out of your own excitement and dreams. Instead let your success make the noise. Let your results speak for themselves.
Let expenses far exceed your revenue.
What do you call it when your expenses exceed your income? It’s not a trick question or a comedic punchline – it’s called “broke!” And it’s really hard to build a business when you are insolvent.
What most founders fail to discuss is the steps back you must take in order to make purposeful steps forward in business. In fact, in the early stages of business you’ll need to cutback on personal expenses and funnel resources into your company. At the same time, it’s not the time to live large and well above your means.
If a personal budget sounds like gibberish to you, then it’s time to learn a new financial language. If you are running out of money before you run out of month, then it is time to revisit your priorities. Since we know that a common reason for startup failure is undercapitalization and cash flow concerns, reigning in your financial picture will keep you far ahead of the game.
Have low expectations.
We often get what we expect. Expectancy theory states that the intensity of a tendency to perform in a particular manner is dependent on the intensity of an expectation that the performance will be followed by a definite outcome and on the appeal of the outcome. Hence, you get what you expect. While some may say the key to happiness starts with low expectations, that doesn’t have any practical advantage or application when applied to business. For entrepreneurs, low expectations are the key to lost profit.
Minimize work effort.
When given the option, most of us would rather work smart in lieu of working hard. But often times, entrepreneurship doesn’t afford that luxury, at first. Anything worthwhile will require work. So, if by chance you perceive that you can sit back and work at it when you ‘feel like it’ you are highly mistaken. Instead, working smart is about leveraging your 80/20.
Better known as The Pareto principle, also called the 80–20 rule, it states that, for many events, roughly 80% of the effects come from 20% of the causes. When applied to business, this means that I want 20 percent of my effort to produce 80 percent of my results. This, my friend, is the very definition of working smarter. But if you’re running a hobby, and not a business it’s okay. “Go ahead, kick back, watch TV, sleep in late. Relax, you deserve it. You’ll be working for me soon. P.S. I like my coffee black, old sport.” (Source: Unknown)
Compare yourself to others.
Theodore Roosevelt once said that comparison is the thief of joy. I’ve found this is particularly true in business. It’s easy to fall into a comparison trap, but the truth is – there is no one that can do what you do, they way you can do it.
The very nature of business can cultivate comparative thinking. However, if you aren’t conducting a competitive analysis it’s a futile effort. Instead learn to celebrate others talents and focus on cultivating your own unique gifts and capabilities. Your worth is not based on how you personally stack up against other entrepreneurs.
When you find yourself envious of what another entrepreneur has accomplished, and feel jealous, or inadequate as the result, you are essentially diminishing your value and the value you create for others. This is the root cause of stress, anxiety, depression, and self-sabotage in business.