Successful Entrepreneurs are often characterized as “Risk-Takers” — But, wait…
The 99% of UNsuccessful Entrepreneurs Were Risk-Takers Too!! So…
“Risk-Taking” has basically become an entrepreneurial badge of honor. The greater the initial risk, the cooler the retrospective story — if, If, IF *IF* the story ends up being a *SUCCESS* story!
But… is this Causation or Correlation?
Does the successful entrepreneur achieve success BECAUSE of his/her risk-taking? IN SPITE OF his/her risk-taking? Or REGARDLESS of his/her risk-taking?
And couldn’t/shouldn’t we ask all those same questions about the role of “risk-taking” in the FAILURES of the UNsuccessful Entrepreneurs?
You will OFTEN hear about / read about the <1% whose big RISK-TAKING resulted in great success, fame, wealth, etc. But you will RARELY hear about the >99% whose big risk-taking led to failure — accompanied by stress, anxiety, regret, depression, bankruptcy, divorce… — or worse!
So… What’s My Point?
*AND WHY DOES IT EVEN MATTER* if we‘re giving “RISK-TAKING” too much credit for entrepreneurial success stories??
- It matters because it creates a startup culture that (unnecessarily — and, in my opinion, unwisely) encourages risk-celebration and risk-glorification (rather than risk-mitigation)…
- It matters because it indirectly encourages “risk-tolerance levels” to be used as a primary means of differentiating “REAL” Entrepreneurs from those who “don’t have what it takes”…
- It matters because it establishes caution, risk-aversion, and pragmatic decision-making (a reluctance to ignore probability and statistics by going “All-In / Full-Time” initially) as bad things, as weaknesses, as a “weeding out” criterion (for “what it takes to be an entrepreneur”), essentially choosing Optimism Over Objectivity and prioritizing “risk-taking & risk-tolerance” ABOVE criteria like: Intelligence? Talent? Skill? Ability? Expertise? Creativity? Passion? Hustle? Motivation? Determination? Dedication? Work Ethic?
- And that all matters because it’s pushing away a HUGE talent pool of potentially-phenomenal founders, co-founders, and entrepreneurial employees (who could have been valuable assets to a plethora of Idea Stage / Pre-Revenue startups, if only it weren’t so frowned upon to mitigate risk and start as a part-time entrepreneur — Sacrificing Weekends And Nights #SWANstartups)… And it’s keeping this HUGE talent pool away from YOUR Startup… from MY Startup… and from a yet-to-be-founded, Game-Changing Startup [that will one day create the medical device that will be used to cure the rare form of cancer that your future grandchild will one day get diagnosed with!]**
**[Editor’s Note: Maybe that last part was a bit dramatic, but hopefully you get the point — The entire startup community is missing out on MANY talented would-be entrepreneurs (albeit initially part-time entrepreneurs), because we’re hung up on this “all-or-nothing” mentality and rhetoric.]
It’s kinda crazy if you think about it, to judge or look down upon (or push away) those whose only/primary “flaw” is that they simply aren’t comfortable with taking a risk that has a proven track record of ~99% Failures!?!*
THIS IS INTERMISSION.
That’s how excessively wordy I am!
I thought you needed a break!
Though I should probably just make this a separate post at some point…
ACT 2 BEGINS IN 3… 2… 1…
If the GOAL is more successful startups (rather than just simply keeping the “Entrepreneur Club” exclusive to those with the risk-tolerance or personality type or personal financial situation to take the plunge and go “All-In/Full-Time” — prior to achieving any of Objective Indicator of better-than-average success/fail odds?)… WHAT IF we (as a startup community) start thinking about (and implementing!) more ways to proactively MITIGATE/REDUCE RISK for potentially-GREAT entrepreneurs, co-founders, and entrepreneurial employees — who might be PHENOMENAL, GAME-CHANGING ADDITIONS TO STARTUPS — but for whom it’s ONLY risk-tolerance / risk-aversion keeping them away?
If you had to choose one, who would you choose as a CoFounder or a key member of your core startup team (like a CTO), someone from Group 1 or Group 2:
- Super-smart, great experience and expertise, one of the best at what they do (coding, design, sales, digital marketing, whatever) — therefore probably twice as effective/efficient (minimal learning curves necessary) compared to an average/new person. Awesome culture fit, totally understands what you’re trying to build, your vision, the value prop, etc. However —
… Never really been a big risk-taker. And, as a rational-thinking pragmatist who values probability and statistics and recognizes the realistic likelihood of startup success as the long-shot that it statistically is, there’s just no way they are going to leave the comfort/security of the big salary and great benefits of their current job (that would be crazy!), so they could initially only commit 10 to 20 hours/week to join you, primarily weekends and nights. Would be open to going all-in/full-time in the future — after you have achieved Product-Market-Fit or significant funding or profitability (or ANY Reliable Objective Indicator that you’re not just one of the 99% of startups that will fail despite truly believing you are the 1% that will succeed).
- Average intelligence, minimal experience, no real areas of expertise, but they’re a born risk-taker (and/or come from a wealthy family) so they’re able to join you FULL-time (initially for no pay or below-market pay) — plus, they have minimal opportunity cost because they’ve only really ever held entry-level jobs before. Plus, after months of frustrating networking events in search of a cofounder or CTO, you’ve so far only really been able to convince 2 or 3 others that they should consider joining you — and this “Average Alex” is probably the best of that group of 3...
Ok, you can probably see where my bias is headed, but…
DO YOU REALIZE how many people there are out there (from GROUP 1) who would be INCREDIBLE ASSETS to your startup, except for the fact that (due to their personal risk-tolerance, financial situation, personality type, whatever) they are simply not willing (or able) to give up their current salary/benefits to join you?
If any of the above resonated with you and you’d like to discuss further — or might be interested in working with us to build-out a program or two (The S.W.A.N. Startup? — Sacrificing Weekends And Nights!), to help promote these ideas, attract GREAT part-time entrepreneurs, and actually build/launch some cool “Starter Startups” based on some of our “ReThinkingStartups.com Improvement Ideas & Initiatives”, please get in touch! — Jeff@StartupWhatever.com
P.S. And/Or, if you completely disagree with everything I wrote and would like to discuss or debate (or just tell me why you think I’m an idiot), I’d honestly love to hear from you too! — Jeff@StartupWhatever.com