In casual conversations with colleagues, I like to joke around and say that I’d be a gunslinger if I lived in the Wild West – or a hunter in the Early Ages… I see being an entrepreneur today very much in the same light.
While working in a corporation is more like trying to figure out a human-made puzzle, being an entrepreneur is more like a primal fight with the forces of nature. It is a challenge that you have to respect, commit, focus, work and build mastery on.
A few years back, I was chatting with a friend that highlighted exactly how not to approach being an entrepreneur. She had a decent idea, a decent work ethic, was smart, was good with people – all the good qualities. But here we were, talking about putting a stop to it all because she was convinced she sucked at this… She didn’t. She felt like a failure. But she wasn’t.
It was her first-ever startup project that had failed, not her. There is a HUGE difference between you being a failure and your first startup failing. In the end; it was more about her ability to deal with feeling unsuccessful rather than the facts of her situation. Long story short; the rest of the conversation was about finding the right way to transition back to a full-time job.
What an entrepreneur is and what s/he do?
The problem goes deep down into a misunderstanding of what entrepreneurs are and what they do. So, here’s what I learned about that in the last four years as an entrepreneur after quitting my job at a reputable tech company, moving from İstanbul to London, launching a number of businesses, failing at some and having what I can best describe as an adventure.
Entrepreneurship is about:
Dealing with failure
Being great at deal-making
And here is the top four. Of course, there are other important things like being in tune with technology, balancing creativity in new ideas with discipline in execution, using the right mental models, planning well and more… But these four I have shared, easily take the stage as the most important things to get right – or the things that I see people getting most of the time.
There are different dimensions to each that are vital. These dimensions are not always readily visible from the outside. So I will try to elaborate.
“Entrepreneurship is about dealing with failure.”
- Separate your sense of self-worth from your failed projects.
- Have a healthy fear of failure. Generic superhero movie quote: Courage is not the absence of fear, it is having the strength to overcome it. But it is true. And applies very well here: Healthy dose of fear keeps you from taking stupid risks and making illogical bets.
- Fearing failure is the biggest reason why people can’t realise their true potentials. Being an entrepreneur is like threading the thin line between order and chaos. Chaos turns to order when you “figure it out” (product-market fit, channel market-fit, your niche, whatever…).
- Don’t make big or important decisions with fear. It is all about making high-quality decisions and fear doesn’t work very well when you are making highly complex, abstract decisions with a lot of unknowns.
“Entrepreneurship is about resource management.”
- Capital is not just money. There are multiple types of capital. Time, energy, motivation, intellectual, network, education, reputation and more. What an entrepreneur does is convert from one to others – and try to find the best rates of conversion. (i.e. converting from time capital to education capital or from network capital to reputation capital might be much better than motivation capital to financial capital in most cases if it depletes you.)
- The asset you need to most protective of is yourself. If you burn-out (deplete your belief in yourself, your motivation to create, sell, hustle and work towards a better future), it is game over. Which mean; the most valuable of these resources is your love, belief and respect towards yourself. Your motivation is like a recently kindled little fire when you start out. You have to keep an eye on it, always. Growing that fire to ignite bigger and bigger dreams should be your number one priority (especially while starting out).
“Entrepreneurship is about understanding markets.”
- Knowing how to deal with failures and being smart about your resources means you are ready to take on a challenge, but they don’t by themselves make you successful. The single biggest factor that determines if an entrepreneur is actually successful is their understanding of the market.
- Markets are these complex, hard to decipher, constantly changing the bulk of collective human will (purchasing behavior) that determine if what you are selling has a buyer. Those who are best at understanding markets are actually the people who are the most humble about what they don’t know. Ask the top 10 VC’s which consumer software applications are going to dominate in 2020, and you won’t get a decent answer. Why? Because they will refuse to answer the question unless it is phrased as an invitation to make a wild guess.
Understanding the entrepreneur
- Those who are able to navigate markets are those who know what metrics to look at. Just like a doctor, they look at symptoms and signs and make a diagnosis. (i.e. MRR; Growth Rate, CAQ, Stickiness, etc…) Great entrepreneurs know that they don’t know and do their best to decipher the signs.
- The best way to understand markets is to roll-up your sleeves and run micro-experiments. Early in 2019, I started building cultureboom.co believing there was a big enough market for early-level startups that want to spend on culture building. I was wrong, it was (is) too early for that. But the only way I could have found that out was to launch with an MVP and speak to a lot of potential customers (startup founders in my case).
- A very big part of understanding markets is about understanding the giant role of timing. Did you know that Twitter first started as a podcast business? They were right about the need, just 15 years early.
Another personal lesson if value deeply: If you don’t have a big budget, a lot of time and an abundance of resources; opt towards taking place in an already established market that is rapidly growing (as opposed to the markets you would be the first innovator to open the space up).
“Entrepreneurship is about finding the right partners“
Even when running a solo business, entrepreneurs have to think about what partners they need now and in the future. And when you are building a team, it’s important that everyone sees themselves as potential deal-makers and not someone there just to be told what to do.
Take time to understand your company needs to create the right strategy that will attract and retain partners. Possible partners include the employees, the supplier and vendor community, the government, and the public. For a stress-free process when looking for the right talent, work with agencies such as a hospitality recruitment agency that understands the needs of the hospitality industry.
Understand what the partners need to stay focused on your business and see how you can offer them value. This will help build loyalty and long-term relationships.As you will realize, business is about creating a win/win situation, not just for you but for everyone involved in the deal.
“Entrepreneurship is about being great at deal-making.”
- Business is making deals. The end. A customer contract is a deal. A hiring decision is a deal. A partnering decision is a deal. A collaboration project is a deal. They are all deals.
- People who are good at making deals reject a fool’s choice when they see one. (Those who take the “Fool’s Choice” see only two outcomes or behaviours, usually in terms of either/or – but there are always other options.)
Entrepreneur example side note:
A UK based accelerator program located outside London is trying to increase the number of applicants and is looking for recruitment companies to help them. In their mind they have two choices; buy a recruitment service (which they don’t have the funds) or do the recruitment themselves (which they don’t have the necessary time), so they are stuck.
In reality, there is a third (and most likely a fourth and a fifth) way to do this deal. They can offer the recruitment company a “win” via a partnership. (e.g. the opportunity for them to position themselves as a tech/startup-friendly recruitment business by offering their candidates a second chance at a reputable acceleration programme even if they don’t get the role they got in touch first for.) This is a “win” has tangible business value that a partnership with the accelerator can provide. Cost = £0. Value for both parties = Big.
- Being good at deal-making requires command of technology, out of the box thinking type of creativity, and most importantly, a very good understanding of the opposing business’s priorities and needs.
- Deals are leverage. They allow you to know about what other people don’t, see what others can not, get things done others aren’t able to and multiply your efforts at value creation.
So the biggest takeaway, I guess, is being honest to yourself about what type of a challenge you are most suited for. Which one do you like more: Solving human-made puzzles or being in a primal fight with the forces of nature?