Of course, an appetite for entrepreneurial risk is essential; but it is not enough: good judgment, planning, resource allocation and management, people skills and myriad other ingredients are indispensable to creating a successful venture.
On the employee side, working for a start-up can offer unique benefits, such as the opportunity to play a pivotal and guiding role in a new venture, absence of immediate pressure to generate revenues [during the design and implementation phases], and freedom from immediate client/customer pressure and complaints.
Entrepreneurship involves an innovative or profitable approach to business in which new ideas or great ideas are brought to life in the form of a tangible business structure and setting. To become an entrepreneur, one must possess a number of traits, including being innovative, driven, hard-working, have high business acumen, be a risk taker, have strong analytical skills and nerves of steel, possess the ability to seek out an opportunity, the ability to follow leads, the ability to make decisions quickly and many other key traits.
In periods characterized by job insecurity, widespread unemployment, downsizing, low interest rates for investment loans, first-mover opportunities in rapidly developing sectors, e.g., innovative technology, entrepreneurship is likely to become attractive. Then there is the perennial entrepreneurial personality type: These are people want to work for themselves, be their own boss, control the money and opportunities that their business generates and generally make all the important decisions about the business.
Of course, this also involves a great deal of risk and vision. The greater the vision, the more acceptable risks will seem. However, the risks of failure cannot be minimized - 3 out of 4 startup ventures fail, according to a recent Harvard study. Causes of failure are countless: inadequate market research, unworkable or endlessly revised business plan, flawed projections of founder enthusiasm onto the broad consumer market, uncontrolled capital burn-rate, mis-estimates of costs and revenue streams; unexpected increases in the cost of borrowing, product or service obsolescence, supply-chain breakdowns, etc.
The wise entrepreneur will not only identify such hazards, but also prepare contingency plans for coping with those that cannot be prevented at the outset.
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