Entrepreneurs without money (III).What is the entrepreneurial profile required for success? Part B.
Today we will continue with the entrepreneurial profile required for success. We define a successful entrepreneur as the one that is able to be “integrally” successful. A successful entrepreneur is able to be financially stable but also is doing business with “awe”.
On our last post, we listed 4 characteristics of successful entrepreneurs: (1) Passion for what we do; (2) Wise Use of Money; (3) Resilience and (4) Vision.
Let´s continue today with the rest of the characteristics:
5. Balance: Knowing when to act and when to wait and when to rest. We live in a society that gives rewards to people who are assiduous hard-working to excel. Which is fine. We live a certain type of values where the people who work harder are recompensed with a bonus. And the procrastinators which are considered as “lazy” are punished. It is time to rethink this. Not all procrastinators are slothful. And not all “hard-workers” deliver results without hurting their health or family. I have met people who stay long hours in the office, and are not effective neither efficient. Additionally, building a hard-working life by sacrificing a family or our health has nothing to do with success. A successful entrepreneur has learned in his or her own skin that time balance is the key for inspiration and sharpness. Time management is key.
6. Healthy lifestyle: Successful entrepreneurs have understood that keeping a healthy lifestyle is as relevant as working hard. A healthy lifestyle includes sleeping at least 8 hours per day, eating properly (with veggies, fruits, proteins, reducing carbohydrates and alcohol to a minimum), drinking enough fresh water daily, practicing sports at least 5 times per week (any sports discipline is ok), realize at least one artistic activity (music, painting, sculpture, poetry-writing, theatre, dance, photography, etc), loving nature and protecting animals, etc. Furthermore, remember that we need to feed our brains physically, and emotionally with positive experiences that can only be found in the middle of nature or natural habitats (forests, savannas, lakes, grasslands, oceans, mountains, etc). An entrepreneur without regular healthy natural exposure is like a criminal inside a grey prison. God has gifted us nature to re-charge our batteries. To feed our brains. Nature is free and we have forgotten it by spending our days with our smartphones and technology. Let´s not lose time to enjoy nature. And it is free!
7. Learning every day: Successful entrepreneurs do not give up on learning. We have understood that learning from others is as significant as learning from books and through formal education. Looking for excellent sources of thought, action, and practice. Learning from elder masters as much as from youngsters. Learn by reading. Learn by watching others how they learn. A successful entrepreneur never stops in his or her quest for wisdom. Learning from the past is as transcendent as learning now, and learning for the future. Learn new languages, learn about different disciplines beyond our own field. Moreover, nowadays is so prominent to re-learn what we think we know. Keep educating yourself.
8. Financially savvy: A Successful Entrepreneur has knowledge about the drivers of a firm´s profitability and growth. We know what are the tradeoffs between product-market strategies and financial market policies. We have basic knowledge of financial analysis and cash flow analysis in a variety of contexts. We also have knowledge about the four financial levers of decision making in our companies: (a) managing revenues and expenses, (b) managing working capital and fixed assets; (c) Managing liabilities and equity and (d) managing payout. Many entrepreneurs fail because they believe that an idea with a lovely market strategy is enough to create growth and net-worth in the long run. Without an understanding of the financial analysis, it is not possible to do forecasting and prospective analysis for the future. We won´t be able to do valuations, and our corporate decision making won´t leverage us for growth. It is insane to start a company without knowing the meaning of financial ratios and key indicators such as NOPAT (Net Operating Profits After Taxes) or Discounted Free Cash Flows!. Remember, “Many small businesses fail because the owner doesn’t keep tabs on the firm’s cash flow and financial position. If you understand financial statements, you can prevent this from happening in your business”.
Of course, there are additional characteristics of successful entrepreneurs which we have not listed, such as flexibility, strength or resistance to rejection, perseverance, the desire and willingness to take the initiative, competitiveness, self-reliance, achievement, self-confidence, etc. But why do entrepreneurs fail even if they have all those traits in their endeavors?
This leaves us, with our next question to answer: Why do entrepreneurs fail? Even the most reviewed startups with venture capital investments fail. In a study by Statistic Brain, Startup Business Failure Rate by Industry, the failure rate of all U.S. companies after five years was over 50 percent and over 70 percent after 10 years. Even if we have not reviewed the stats of this source, failure is inherent to start-ups. Why?
This is the next subject to cover in our next post… Stay tuned! Thank you.
Disclaimer: All the presentation slides shown on this blog are prepared by Eleonora Escalante MBA-MEng. Nevertheless, all the pictures or videos shown on this blog are not mine. I do not own any of the lovely photos or images posted unless otherwise stated
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