Do you want to run your own business?
Do you see yourself as the boss, making big decisions, and earning a lot of money?
These all sound nice but it’s also a lot of work.
Starting your own business is backbreaking work. Anyone who claims it’s easy is lying or isn’t really running a business.
As an entrepreneur, your hours will be long and you’ll have to deal with new challenges and problems everyday. If your heart isn’t in it, you will lose money and fail.
The Bureau of Labor Statistics’ (BLS) record shows that 30% of small businesses fail in the second year, while a whopping 50% don’t make it past five years.
Despite the odds, thousands of people still choose to pursue the path of entrepreneurship because of its promise of financial freedom, among other things.
There are some things you can do to stack the odds in your favor. Great entrepreneurs aren’t just born that way, after all. They are born through hardship and experience.
Below are different traits of successful entrepreneurs that you can emulate to increase your chances of success.
9 Traits of Successful Entrepreneurs Worth Following
1. High Tolerance for Risk
Being an entrepreneur means foregoing a steady paycheck— at least until your business takes off and stabilizes.
Many entrepreneurs risk their own savings to bootstrap their business. Barbara Corcoran, one of the hosts at Shark Tank, used a $1000 loan to start the Corcoran Group real estate company, which she sold for a cool $66 million exit profit in 2001.
She didn’t even like real estate and admits she’s not even a good closer. But she took a risk and it turned out her people skills made her a good CEO.
A high tolerance for risk and uncertainty is one of the main characteristics of entrepreneurs, and it’s especially evident for those who are pioneers in their field.
2. Organized Planners
Successful entrepreneurs are good planners. They plan for the year, the quarter, and the months and days in between.
Planning helps them assess current resources, research competitors, create goals, and delegate tasks to run the company. A well-researched strategic plan can make the difference between hitting your annual sales goals and failing spectacularly.
Entrepreneurs also create methods, procedures, and policies for how things are done in their organization. That’s how they scale and delegate their sales, operations, marketing, customer service, and almost every business process without things going haywire.
3. Tenacious and Resilient
Three out of four startups fail, according to a different study by Harvard Business School lecturer Shikhar Ghosh. As sad as it sounds, many entrepreneurs will fail on their first attempt to start a business.
What’s not often mentioned in the news is that many of these failed startup founders and small business owners dust themselves off and try again. By refining their ideas and trying again, many of them do succeed eventually.
Like Sir Winston Churchill said, “Success is the ability to go from one failure to another with no loss of enthusiasm.”
So much of running a business means dealing with failure, and that’s why resilience is one of the most valued characteristics of an entrepreneur. Your business per se might not fail, but your supplier and employees might mess up. As the boss, you’ll have to deal with it or risk losing your business.
Instead of giving up, successful entrepreneurs come up with ways to learn from their mistakes and turn things around.
What went wrong?
What can I do better next time?
What’s a good alternative in case this problem happens again?
These are the kind of questions a resilient entrepreneur will ask himself.
Walt Disney, Richard Branson, and Steve Jobs didn’t give up when things got rough in their business.
4. An Inquisitive Mind
Nokia was once the top mobile phone company worldwide, until Apple came along. Industries evolve and consumer demands change all the time. If you’re not constantly learning and improving, you will get left behind.
Entrepreneurs need to stay sharp if they don’t want to be overtaken by their competitors. Read books on leadership or sales, take courses, and keep up with changes in your industry.
Better yet, make sure your employees receive continuous training to improve their skills too.
For outsiders, it’s easy to assume that many entrepreneurs go into business for the money. Yes, a big payoff sounds great but you’ll soon doubt if it’s worth it once you see all the work involved.
Prof. Jay Friedlander, who teaches sustainable business at Babson College and College of the Atlantic says, “Most entrepreneurs I know believe they will change the world. There’s an excitement and belief in what they’re doing and that gets them through the hard times.”
Passion for your business’s product, service, or mission is an excellent source of intrinsic motivation that can sustain your company’s profits takeoff.
John Roulac, founder of Nutiva, was passionate about the uses of hemp for sustainable agriculture. He launched Nutiva in 1999 to create a new market for Canadian hemp farmers, but he often had trouble with the US Customs who associated his products with marijuana.
The first two years of his business were tough but his passion for hemp kept him going, even when the Justice Department ruled that hemp products were in the same category as heroin.
Roulac could’ve been bankrupted by this new ruling. Instead, he sued the Drug Enforcement Administration (DEA) with the help of Dr. Bronner’s soap and other natural-product entrepreneurs. They won the suit two years later and Nutiva has since expanded into other natural healthcare products.
6. Willingness to Ask for Help
Many entrepreneurs are jack of all trades with knowledge in many parts of running a business. But they know their limitations and aren’t afraid to ask for help. Successful entrepreneurs know that it’s more productive to delegate a task to someone who can do it faster and cheaper.
7. Budget Conscious
It doesn’t matter if you’re bootstrapping your business from your own savings or you have millions at your disposal in venture capital funding. Whatever your financial situation is, you won’t last in business if you have poor money-handling skills.
Good entrepreneurs know how to track their profits and expenses. They also know how to allocate money for emergencies, expansion, and other business expenses.
When it comes to business, poor financial decisions won’t just ruin your personal credit score. It can also leave you in terrible debt.
Create a clear financial plan for your business. List all your monthly operating expenses and income. Make sure it balances out. If you’re bootstrapping, create a separate budget for your personal expenses and make sure they don’t mix with your business expenses. Not only is this confusing come tax season, but taking money to pay for personal expenses is an easy way to run out of funds.
8. Good Salesmanship
If you want to start a business, you need to learn how to sell.
Need funding? You’ll need great persuasion skills to convince investors.
Need suppliers? You’ll need to learn how to negotiate the best payment terms.
Need customers? You’ll need to know how to show them the benefits of buying your products and services.
Need employees? You’ll need to sell them in on your vision, especially if you want top talent but can’t afford to pay like Google.
Even if you don’t see yourself selling your products or services in the long run, you need to know how to do it yourself first. Otherwise, how will you train people to do it for you? And how will you know what to improve on your products if you don’t talk to customers?
Before Bloomberg became a big financial company, its founder Michael Bloomberg would buy coffee and give it to the associates at Merrill Lynch every morning. He’d walk the hallways giving cups of joe while building a relationship with his target audience. He used this time to learn about his audience and their needs.
Three years after Bloomberg’s launch, Merrill Lynch bought 20 terminals and became their first client.
As this story demonstrates, you can’t delegate evangelism. You have to do it on your own, at least for starters.
Do you want an audience to pitch your business ideas? Download Goodwall and submit your pitch there.
Entrepreneurs need to adjust according to the market. Sometimes, these adjustments won’t just be for new features or pricing. In some cases, you might have to come up with a whole new concept and start from scratch.
It sounds like too much work, but many entrepreneurs will tell you that their current business is different from what it was when they started. This happens for many reasons.
It could be because the demand isn’t as big as they originally projected, or that their initial idea might’ve been great but not cost-effective. It could be other things, too. As an entrepreneur, you have to go with the flow to stay in business.
For instance, Hyungsoo Kim, creator of Eone, initially created a braille wrist watch to help blind people tell time.
He identified a gap in the market and created a solution tailored for them. Still, his braille wrist watch didn’t sell as much.
After a couple of discussions with his audience, Kim found that they wanted to tell time but they didn’t want to bring attention to their disability.
As surprising as it sounds, they didn’t want a watch specifically built for the vision-impaired. They wanted to feel included in the regular watch market.
Kim is adaptable so he built a watch that works normally and in braille. His second prototype called Bradley, raised almost $600,000 in crowdfunding.
As Kim’s experience suggests, entrepreneurs should be adaptable to the demands of their market. You can’t always expect your product to be a hit right off the bat, so think of the whole product-market fitting process as an exercise in problem solving.
Which of the Characteristics of an Entrepreneur Do You Want to Cultivate First?
To recap, here are nine traits of successful entrepreneurs:
- Tolerance for risk
- Good organization skills
- Inquisitive and curious
- Willingness to accept help
- Budget conscious
- Good salesmanship
Which of these traits do you already have? What characteristics of an entrepreneur do you lack? I suggest you pick three to work on and prioritize it according to what your business needs most right now.
Remember, you can’t be perfect at everything but you can improve yourself little by little everyday.