By Alissa Bryden, CPA, CA
(10 minute read)
My undergrad degree was a Bachelor of Commerce in Entrepreneurship. I studied entrepreneurship everyday and analyzed case study after case study on business owners and their stories. We looked at the types, traits, life circumstances and then got into the steps they took to make it happen. We looked at cases where they succeeded and also where they didn’t.
For my first blog post, I thought it would be an interesting topic to dive back into. With the benefit of experience (and additional education in accounting) I wish I could take another look at all those case studies again. Instead, I will review my take on some of what we analyzed then and what I have seen (or experienced) since.
Types of an Entrepreneur
Over the years, I have met a lot of entrepreneurs. And I always knew I would be one some day. I have heard people joke that some people have to be entrepreneurs because they don’t like to be told what to do. The other day, I was speaking with a retired business owner, who said he found that funny because as a business owner you just have more people telling you what to do (clients, suppliers etc.).
In all the start-ups I have seen there have been some consistencies in the owners (there are always exceptions to the rule though). I have found there are two types of entrepreneurs, the “born” entrepreneur, who has always been looking for the right idea to pursue. Some entrepreneurs pursue multiple ideas in their lifetime just waiting for the right one to “make it”. Or, they are constantly on the lookout waiting for the right time, and the right opportunity. These are the people who maybe haven’t started a business but are constantly reading about entrepreneurship, new businesses, new technology or new ideas. I call them the “born” entrepreneur. In my experience, it is not just “money” they want but a true desire to create a business (although money often plays a big part in in too!). On the other side, there are people who found a business and were more forced into entrepreneurship. Let’s call them the “made” entrepreneur, this would be the physio who entered physiotherapy because of a passion for it. Then this stemmed into having certain ideas around how they would want a practice which eventually leads them to opening their own to allow them to pursue those ideas.
As I mentioned, I always thought one day I would become an entrepreneur. When I was studying entrepreneurship I had a vision of being a small business consultant and “helping small businesses”. When I realized that good advice was the result of good information (the accounting) my path to becoming an CPA was clear. So I would be placed in the “born” category.
Traits of the Successful Entrepreneur
There are many traits to choose from but I will pick three that I think are the most important. 1) Perseverance – entrepreneurship is filled with ups and downs. Anyone entering this strange world needs to be able to get through the downs to get back to the ups. 2) Organizational skills – the ability to “triage”. As an entrepreneur there is so much to do (especially at startup!). An entrepreneur needs to be able to un-emotionally categorize tasks and proactively complete them. Otherwise, you can get overwhelmed and unproductive which can hurt your chances of success.
As an accountant, I have seen entrepreneurs who focused on only “the fun stuff” and left the boring stuff (the accounting and administrative work) for the back burner. When it was finally dealt with months or sometimes years down the road, it may or may not have been too late for the business. But one thing is for sure they cost themselves opportunity and money, usually in that order. Without the numbers, businesses were running blind on general notions of levels of cash in the bank or debt. If your looking at becoming an entrepreneur, categorizing tasks by level of importance is very important. Make sure that you are dealing with all of it (including the boring stuff). An important part of this is getting the right advisors or experts on your team (bookkeeper, accountant, lawyer or banker) depending on the situation. Many entrepreneurs try to do it all to save money but sometimes in the long run this can cost you more than you save.
The final trait of the successful entrepreneur (in my opinion) is adaptability. We always hear it “the world is changing” and fast. Business owners need to be able to keep up with that change and be careful of clinging to the ways of the past because it was how they always did it. This is easier for “millennial” or “near millennials” who have grown up in a technologically fast paced world but may be harder for the older generations. Even millennials tend to have preferences (its human nature) such as “I am an Apple person” or “I only use Android” etc. My tip is to just ensure you are re-evaluating your decisions to ensure they continue to be what’s best for you and your clients. This can be applied to the technology you use or just the way you do business in general.
Some people wait for the right “moment” to be an entrepreneur and it never comes. There may be life situations such as a new baby, out of work spouse, illness in the family or whatever. There is always an excuse. I will also say it may be a good one. Being an entrepreneur can take a lot out of you and you need to be conscious of that. But you should also never let excuses get in the way of your dreams. A solid plan in place and you can feel more confident that you can do it despite “insert excuse here”. I have also noticed in my dealings that the most successful entrepreneurs had a solid home support team (either family or friends). I have seen both marriages, families and friendship’s ripped apart due to the business. Make sure your plan includes maintaining these relationships so you don’t lose what’s important in the process of starting and running your business. You can also find networks in your community (like Rotary groups, professional chapters, etc.) they can be great sources of advice and support. I have never liked the word “mentor” because a mentor is only one person and I strongly feel you need a solid “team” to be successful. I also caution that advice is often freely given and these individuals may have the best of intentions but it may not be the right advice for you. For example, I have seen businesses who incorporated too early on bad advice from a “friend”. Try to be open minded, but also recognize when professional advice is needed.
I would not be doing this without the support of my husband, who has been amazing. I also have a lot of family and great friends who are always willing to lend an ear (and often advice). Sometimes I take their advice, sometimes not, but its great having someone to bounce ideas off of. They are my anchor. Make sure you have one too.
So your still ready to be an entrepreneur? My final recommendation is to have a plan in place. It can be formal or informal but get it written down so you have something to go back to. I consider the business plan an “active” document that changes as you adapt. The businesses I have seen fail often lacked a clear concise plan on what they wanted to achieve and how to get there. I will post more on a business plan blog in the future as there would be too much to cover here.
I am just at the start of my journey in entrepreneurship and I am happy I took the leap. If you are still considering it, or all ready have become an entrepreneur, I wish you the best of luck and hope to read about your success one day.