Who is an Entrepreneur?
- An entrepreneur is a starter. An entrepreneur is an initiator, a challenger and a driver. Someone that creates something new, either an initiative, a business or a company. He or she is the beginning (and sometimes the end) of a venture, project or activity. The entrepreneur might not be the ideator, but he or she is definitely the one that decides to make that idea a reality.
- An entrepreneur is the driver. The entrepreneur is the person in charge, the leader and the person to look to for leadership. He or she is the one that pushes forward and inspires a team to follow. The entrepreneur is the one that sits in the driver’s seat, and has the ability to change direction, accelerate, slow down or even stop a venture.
- An entrepreneur is accountable and responsible. The entrepreneur is the ultimate responsible for the destiny of its venture, which can be a company, a project, or any other endeavor. The entrepreneur is the one that has the highest stakes at the venture, thus the one that needs to be empowered to fully direct the endeavor.
Being an entrepreneur is not directly related to having an equity stake in a company, but instead showcases the leadership-related points. Why do we tend to associate entrepreneurship with equity ownership (as value), instead of understanding it as the one that has the highest stakes in an endeavor, which sometimes gets translated into entrepreneurship?
Entrepreneurship is more than financial gains
We tend to associate entrepreneurship with direct financial benefits and risk, but not only when the entrepreneur has equity in the company, he or she is exposed to the financial upsides and downturns. Corporate ventures and corporate entrepreneurship allows “corporate entrepreneurs” to benefit of the upsides of their projects without having equity stakes.
Corporate entrepreneurship does exist
Traditional corporate culture tends to disregard the entrepreneurial approach. However, with the proliferation of new startups and disruptive innovations, corporations have been forced to embrace the entrepreneurial approach towards running and operating their business. An entrepreneurial approach is not only more agile and dynamic, but also results in a more lean operation. By providing a strong level of staff empowerment, you create a strong sense of ownership, which results in better outcomes for any endeavor.
Passion is the real drive
There is another element that really dwells at the center of any entrepreneur: passion! An entrepreneur possesses an interior fuel and stamina that drives his or her actions; this superior energy helps to overtake and surpass the different challenges and it injects strength to continue pursuing goals when difficulties arise. Anyone can be an entrepreneur and behave like one- regardless of whether or not they happen to be an equity holder. Ultimately, it’s all about the attitude when running the show.
6 Steps to Successfully Launch a Business
Before launching your business, here are six steps to ensure a successful start.
1. Go beyond the business plan.
Planning carefully before launching a new business is not limited to preparing a business plan, says Bruce Bachenheimer, clinical professor of management and director of the Entrepreneurship Lab at Pace University in New York City. “While preparing a business plan is generally a valuable exercise, there are other ways to plan carefully,” he says. Bachenheimer recommends three planning methods.
- The Apprentice Model: Gaining direct industry experience, as the founders of Tender Greens did.
- The Hired-Gun Approach: Partnering with experts who have in-depth knowledge and experience.
- The Ultra-Lean School of Hard Knocks Tactic: Figuring out a way to rapidly test and refine your model at a very reasonable cost.
While writing a business plan is certainly helpful, the real value is not in having the finished product in hand, but rather in the process of researching and thinking about your business in a systematic way, according to Victor Kwegyir, founder and CEO of Vike Invest, a U.K.-based business consultancy. “The act of planning helps you to think things through thoroughly, study and research if you are not sure of the facts and look at your ideas critically,” he says.
If you don’t commit to in-depth preparation, launching a new business can be a very expensive lesson in the value of planning. Bachenheimer asks: “Would you enter a high-stakes poker tournament without knowing the game, assuming that you’ll figure it out as you go?”
2. Test your idea.
Sixty percent of new businesses fail within the first three years, according to Victor Green, a serial entrepreneur and author of How to Succeed in Business by Really Trying. “Too often people rush into business without carefully checking out their idea to see if it will work,” he says. “Research is essential.”
While the internet makes it possible to conduct research without leaving your desk, Green says Googling isn’t enough. “Talk to real people who are in the business you want to go into. Talk to people who might be your customers and get their views and opinions,” he says. “Test your ideas if possible.”
For the founders of Tender Greens, spending two years in the planning process allowed for a unique opportunity to try their ideas out on the public that would eventually become their clientele. “During that time we were testing recipes and refining our business,”
3. Know the market.
Ask questions, conduct research or gain experience to help you learn your market inside and out, including the key suppliers, distributors, competitors and customers, Bachenheimer says. “You also have to really understand the critical metrics of your market, whether it’s as simple as sales per square foot and inventory turnover, or an esoteric measure in a highly specialized niche market,” he says.
Tender Greens’ Oberholtzer and his partners spent many years working in the California restaurant industry before launching their business. That experience allowed them to not only perfect their craft, but also to develop longtime relationships with food purveyors, farmers and other suppliers that they relied on to help Tender Greens succeed. In fact, Scarborough Farms, the restaurant’s lettuces and greens supplier, is a partner and investor in the company, thanks to its long relationship with the founders.
4. Understand your future customer.
In most business plans, a description of potential customers and how they make purchasing decisions receives much less attention than operational details such as financing, sourcing and technology. But in the end, it will be the customers who determine your success or failure, Blue Canyon Partners’ Brown says.
“You need to know who they are going to be, what drives their purchase decisions, what you can do that will differentiate your offering from that of competitors and how you can convince them of the value of your offer,” he says. “And the answers to those questions shouldn’t be off-the-cuff guesses. They need to be well-grounded in reality and market testing.”
Understanding your future customers can be the difference between changing a failed aircraft engine on the ground vs. doing so midflight, Brown says. “The former is much simpler and much more likely to be successful. Once you start up the business, it’s likely that you will be consumed with operating details, often with little time to think and even less to make adjustments. Implementing the right plan from the start is far more likely to yield success than figuring out a plan on the fly.
5. Establish cash resources.
“Cash is king, so you must take steps to adequately capitalize the business and secure ready sources of capital for growth,” says Steve Henley, senior managing director and national tax practice leader at Cbiz MHM, an accounting and management service provider. “A good cash-forecasting tool is critical so that you can plan for the sources and uses of cash on a rolling basis.”
While some startups rely on owners’ capital, others look to investors. Tender Greens’ owners raised funds from friends, family members and colleagues.
To determine how much cash you’ll need, develop a cash-flow statement that estimates your expenses and income. Be sure to include appropriate expense levels by researching actual business costs rather than estimating based on your personal experience as a retail consumer. “For instance, you can host your personal website with unlimited bandwidth for $9.95 a month, but operating a commercial website may cost hundreds or thousands of dollars a month,” Pace University’s Bachenheimer says.
Limit your need for cash by avoiding long-term commitments, like long-term leases, until necessary, adds Cbiz’s Henley. “There will be a considerable amount of uncertainty during the first few years, so be conservative in making commitments for resources that might not be yet needed.”
6. Choose the right business structure.
From the beginning, it’s crucial to select the appropriate corporate structure for your business, which will have legal and tax implications. The structure you choose can also ensure the success of future decisions, such as raising capital or exiting the business.
Most startups should probably operate as either an LLC or an S Corporation, Henley says, because starting with one of those structures and converting to a C Corporation later is much easier than starting as a C Corp and trying to convert to an LLC or S Corp. To determine which structure is best for your business, Henley outlines four considerations.
- Liability limitations: For C Corps, S Corps and LLCs, the owners’ personal liability is generally limited to the amounts invested and loaned. There is unlimited liability for general partners.
- Startup losses: If your company is an S Corp or an LLC, also known as “pass-through” structures (because tax liabilities and benefits “pass through” to the owners’ personal tax return), you can usually write off startup costs as losses on your personal tax return. In a C Corp, startup costs producing tax losses can only be utilized at the business level and offer no future benefit if the new company has future tax profits.
- Double taxation: “Generally, double taxation of earnings is avoided for pass-through entities, but not for C Corporations,” Henley says.
- Capital-raising plans: If you plan to take your business public or fundraise through private equity, these plans may require that the company not be a pass-through structure.
19 things emotionally intelligent people do
For the past several years I’ve been addressing the following question through my writing:
What does emotional intelligence look like in everyday life?
I’ve endeavored to answer that question thoroughly in my new book, EQ Applied. If you’re looking for a preview, I’ve outlined 19 actions below that highlight how some people are able to make emotions work for them, instead of against them.
Here are 19 things that emotionally intelligent people do:
1. They think about feelings.
Emotionally intelligent people are able to identify emotions and understand the role they play in influencing a person’s thoughts, words, and actions.
They do so by quietly observing both themselves and others, reflecting on those observations, and (at times) sharing their conclusions. This enables them to see what’s happening “below the surface,” so to speak…and to identify the reasons behind our behavior.
2. They pause.
Emotionally intelligent people realize that emotions are fleeting, and that often making impulsive decisions leads to regrets. Therefore, they try to pause and think before speaking or acting–especially when they find themselves in an emotionally charged moment.
In short, their goal is to never make a permanent decision based on a temporary emotion.
3. They control their thinking.
Most emotions are experienced instinctively, meaning you can’t control how you feel in any given moment.
But emotionally intelligent people recognize they can control how they react to those feelings–by focusing on their thoughts. In doing so, they avoid becoming a slave to their emotions.
4. They learn from “emotional hijacks.”
The truth is, none of us can control our emotions perfectly. We all make mistakes, and we’ll continue to do so. Show me an “expert” in emotional intelligence, and I’ll show you another person who loses their temper or makes an emotionally faulty decision–under the wrong circumstances.
But those with true emotional intelligence endeavor to learn from mistakes. They study their behavior, identify their triggers, and cultivate the habits they need to successfully keep their emotions in balance.
5. They demonstrate humility.
Many people today view humility as weakness.
6. They practice honesty.
Emotionally intelligent people do more than say what they sincerely believe; they also avoid half-truths and strive to present information in a way that won’t be misinterpreted.
They realize that a focus on technicalities, loopholes, and escape clauses may win them a trial in court, but it won’t win them others’ trust.
7. They’re authentic.
Those with high emotional intelligence realize authenticity doesn’t mean sharing everything about yourself, to everyone, all of the time.
Rather, they endeavor to always say what they mean, mean what they say, and stick to their values and principles above all.
8. They show empathy.
Instead of labeling others or freezing them in time, emotionally intelligent people work hard to see things through another person’s eyes.
They listen, not to form judgments. Rather, they listen to understand–which leads to deeper, more connected relationships.
9. They commend others.
Emotionally intelligent people look for the good in others. Then, they share specific praise.
They also focus on nurturing others’ potential. By doing so, they create positive, self-fulfilling prophecies.
10. They deliver necessary feedback effectively.
Negative feedback has great potential to cause hurt feelings.
Realizing this, emotionally intelligent people reframe criticism as constructive feedback, so the recipient sees it as helpful instead of harmful.
11. They apologize.
“I’m sorry” can be the most difficult words to say.
But emotionally intelligent people realize the power of those words. They also know that saying sorry doesn’t always mean you’re wrong–just that you value your relationship more than your ego.
12. They forgive and forget.
Hanging on to resentment is like leaving a knife inside a wound. While the offending party moves on with their life, you never give yourself the chance to heal.
But by forgiving and forgetting, emotionally intelligent persons move on–and prevent others from holding their emotions hostage.
13. They keep their commitments.
We live in a world where it’s become commonplace to “bail,” “ghost,” or simply flake out.
But emotionally intelligent people realize that keeping their word–in things big and small–establishes a strong reputation for reliability and trustworthiness.
14. They tell good stories.
Everyone loves a great story.
Realizing this, emotionally intelligent people use anecdotes and narratives to bring numbers, facts, and key ideas to life. Through illustrations and real-life examples, they touch others and motivate them to act.
15. They help others.
One of the best ways to inspire someone is to help them.
By extending a supportive hand, emotionally intelligent people help others to become the best version of themselves.
16. They know when to relax.
Those with high emotional intelligence realize they needn’t understand every feeling as they experience it, or dissect every event as it happens.
Rather, they search for deeper understanding when beneficial. And simply enjoy the moment when not.
17. They safeguard themselves from emotional manipulation.
Emotionally intelligent people realize that there’s a dark side to EQ–like when individuals use deception to manipulate, or pursue selfish goals at the expense of others.
And that’s just one reason they continue to sharpen their own EQ, so they can protect themselves and others.
18. They embrace diversity.
Emotionally intelligent people recognize that EQ comes in all different packages, shapes, and sizes. Man or woman. Quiet or loud. Brash or meek. Leader or follower.
As they become aware of their own emotional tendencies and weaknesses, they endeavor to learn from those who are different–realizing it is these persons from whom they can learn the most.
19. They recognize the power of emotions.
Our emotions influence practically everything about our lives.
Emotions can cause us to make a split-second decision, with consequences that will follow us for the rest of our lives. At times, they make us feel like we’re stuck in a black hole with no way out–even if in the eyes of the rest of the world we’ve got it made. But they can also provide light at the end of the tunnel, making the most dire of circumstances more bearable.
It is for all these reasons that emotional intelligence is so invaluable.