Tough at the Top, The Psychology of Entrepreneurship (2 of 2)
Overcoming the Challenges Blog 2 of 2 in this series about the psychological difficulties inherent in being a successful entrepreneur, and how to overcome them.
Paul Gregory, former executive director at New Zealand Venture Capital firm Caltech Capital, is a man who knows a thing or two about thinking for success: A psychology graduate who’s spent much of his career advising client companies about growth strategy, he’s quick to point out that there’s no such thing as an ‘entrepreneurial personality’, but identifies a list [link] of what he calls ‘entrepreneurial characteristics’ which, he argues, help the would-be entrepreneur to overcome the challenges and failures that are an inevitable part of striking out on your own.
In his analysis, a key feature of entrepreneurs as distinct from other self-employed individuals is their desire for achievement. This, he argues, leads them to work hard and take calculated risks that others would consider ill-advised.
Risk taking is an inevitable part of entrepreneurship. It’s often the case when trying to grow or diversify a business that information about the market is incomplete, meaning that key decisions are taken in partial darkness, without a clear idea of exactly how things will turn out. It’s important to recognise that this is normal, and to devise strategies for coping with uncertainty, such that the decisions you take are always more than a ‘guess’ or a ‘gut feeling’ and any risks you take are calculated ones. It’s a similar situation to that encountered in extreme sports: To the uninitiated, jumping out of a plane in a wingsuit, or diving with sharks is unthinkably dangerous, but those involved are familiar with the situation, are trained for it, and have developed safety nets for themselves that are tried and tested. The risk is still there, but it’s a risk that’s well understood.
Another trait or skill that Gregory identifies as useful to entrepreneurs is an ability to develop an internal locus of control. Individuals who exhibit this tend to see outcomes as dependent on their own actions, rather than on luck, fate or environmental factors. This can help in making decisions of the type described above, but it can also lead to the sense of failure described by Nina Burrowes in the previous article [link to blog 1] when things go wrong.
I think it’s important to recognise that, although the language of ‘traits’ and ‘characteristics’ implies something inborn or permanent, these qualities are not set in stone, nor are they unique to so-called ‘entrepreneurial types’. Experience tells us that ‘personality’ can be fluid – people are capable of incredible feats of transformational change, and it may well be that, even inside the stuffiest, most risk-averse individual, a hidden entrepreneur lies waiting to emerge.
Dr Burrowes, then, has perhaps the most important piece of advice for would-be entrepreneurs, and the final word in this article.
“As an entrepreneur, your greatest asset is you. You’re worth more than any amount of funding and any idea. Your humanity is the birthplace of your innovation, creativity, leadership skills, passion, integrity, and resilience. It’s where the awesome ideas will come from, it’s how you’ll be able to connect with people, and it’s what will get you through the challenges. A business plan that doesn’t leverage its greatest asset doesn’t make good business sense.”
She advocates putting your heart into your business; recognising that your hopes, dreams and fears are the hopes dreams and fears of your company, and refusing to shy away from your own strengths and vulnerabilities as you make decisions. It’s a roller-coaster ride, so you may as well enjoy it!
Jun 12, 2015