In the past, no one really considered themselves to be an entrepreneur. Sure, people stared businesses, but they didn’t have much support from outside sources. That has changed over the years, though. There are resources for almost everyone who wants to start a business, including men, women, and children. So, why does the failure rate remain so high?
First, many entrepreneurs learn to build a business the way some people learn to swim; they just jump in. They might have the basic skill, or even be very talented at the task at hand, whether it is baking or programming or candlestick making. What they lack is basic knowledge of marketing, management and accounting. Even though there are many resources available, they are too busy doing the task to learn how to do the basics. In this case, ignorance is not bliss; it is a ticking time bomb.
Second, not everyone is wired to be an entrepreneur — just as not everyone is wired to be a social worker, a lawyer, a salesman or an accountant. The success or failure of a business has less to do with the idea and more to do with personality, drive, skill set and tenacity. Businesses don’t fail, people do.
Third, entrepreneurship is about risk. Sometimes it is calculated risk; sometimes it is a shot in the dark; sometimes it is delusional. This is where the current entrepreneurial fever can get dangerous. We have been led to believe that entrepreneurship is this romantic journey of discovery and creativity and believing in your dream. We all read stories about Facebook and Starbucks and countless other successes, but the large numbers of failures just slip away in the night, along with the owner’s life savings. The people behind those failures all believed in their dreams, too. Again, starting a business is risky. Even the most experienced entrepreneurs cannot always predict what will work and what won’t.
Photo by Peter Dutton