Risk taking and Entrepreneurship!
Entrepreneurship is a career in which you work hard to build something exciting and, obviously – make money.
Now, Entrepreneurship involves a lot of commitment (financial and emotional) and responsibilities.
All the commitments come with something called – risk-taking.
You might be wondering, ‘What is risk-taking in entrepreneurship’?
The simple answer is – You need to take the risk and fulfill your commitments to help your business survive -> thrive -> succeed.
The nuanced answer depends a lot on your readiness to be an entrepreneur – A topic we are going to discuss in this answer ‘in detail.’
Entrepreneurship is challenging, draining, yet rewarding. My job is to make it fun and simple for you.
Before I take you through the whole journey, I want to talk about “you” in this chapter.
This is why I start the course by asking you a simple question – “Are you ready to be an entrepreneur?”
Now before you answer the question – I want you to wait.
Have patience, mate!
Irrespective of how pumped up you are after reading about Mark Zuckerberg or Bill gates’ worth, do not answer it now.
Because if you answer it now, you will feel like – how I felt 12 years starting my first venture – An emotional fool who got into the business purely driven by passion 😊.
I would like you to wait until the end of the chapter to answer the question.
As of now, let me help you get an answer to the above question.
Are you Ready to be an Entrepreneur? - Risks & Commitments
Why is it important to check your readiness to be an "Entrepreneur"?
“I did not know anything about this readiness to be an entrepreneur when I started my first venture.”
Yup – I was living in a lalaland hoping for some magic to help my business go from “Survive to Success.”
You really don’t want to know what happened because of my immaturity.
We worked like a donkey for the next few years because we were driven by “passion” and not commonsense.”
Entrepreneurship is a process (you will hear it a lot of times for the next six days, of course) and one of the critical steps of the process is getting yourself mentally ready.
Remember all the boxing bouts you want on TV. In addition to preparing the boxers physically for the fight, there is a lot of money spent to coach them on mental toughness.
Though all the coaches you meet or hear only speak about “business,” my entrepreneurial experience has taught me that you will fail if you are not ready mentally to be an Entrepreneur.
Well – they do not talk about depression or the reality of running a business on your own where you work under tremendous pressure to get into profits and fight against all odds.
The bottom line is – You must be emotionally ready to be an “Entrepreneur.”
And this is what this Step of the course is all about. I want to check your mental preparedness to be an Entrepreneur.
The answer to the question - How ready are you to be an Entrepreneur?
The answer to the question ‘How ready are you to be an Entrepreneur’ also gives you the nuanced answer to ‘What is risk-taking in Entrepreneurship?‘.
In Entrepreneurship, it ultimately comes down to – How do you convince yourself to take risks?
Whenever I have to start a new venture, I check my emotional readiness by asking myself a few questions.
These are the questions that I also want you to ask and then see if you are convinced to take the plunge.
To start with – I always ask myself a simple question “Why do I want to do this?”.
The majority of the time, the answer I give myself is a reason for me to drop my idea.
B.S answers like:
– John built a million-dollar company with this business
– Raghav got a 10 million dollar exit with the same concept
Are not reasons for me to start a venture.
Frankly speaking – they all seemed and sounded good when I was young. Having been an entrepreneur for 12 years, I know in my mind – the above answers are B.S reasons and should not lead anyone to start a company.
If you are inspired to start a company because of any of the above reasons.
My answer is:
However, there are times” when I am enlightened,” and I think straight like a monk who has had a bottle of the old monk.
An answer like “We are going to solve a problem that definitely had a market need” is more convincing than anything else.
Once, I am convinced that I am getting into something that will be impactful and, most importantly – makes me happy.
I move on to check my risk readiness to be an Entrepreneur and there comes the next question, “Am I ready to take calculated risks?”
Over the years, if there is anything I have learned about risks – it is “Inherently, we all are not risk-takers.”
We are not risk-takers as risks are unpredictable.
And with unpredictability comes anxiety and apprehensions of uncertainty.
We humans are not designed to throw ourselves in an unpredictable and uncertain situation where the startup failure rate could be as high as 80%.
So, how do you get an answer to ‘whether you are ready to take a risk by becoming an Entrepreneur or not?’
How do you convince yourself to take risks?
So, how do you get an answer to “whether you are ready to take a risk or not?”
The answer to the above question lies in your preparedness to take risks.
You convince yourself to take a risk by understanding your idea better and following steps like Market Research and Financial Planning or following all the steps to getting ‘entrepreneurship ready.’
However, these are the topics that are more related to business, and I will be covering them in the next few days.
At present, my focus is “You.”
You and your readiness to be an entrepreneur.
You and your risk-taking ability to be an entrepreneur.
If I were you, here is how I would start:
I always check my risk readiness by getting my finances in shape.
I assume that I will not get paid for a year. Hence, my bank balance should be able to support me for one full year and that’s non-negotiable (period).
The next step for me is to get my family on board with what I will do.
Trust me, they are the ones who will be an equal member of the journey as I will be missing for the majority of family time, and they will need to understand my now our financial situation better.
I ask myself, “What is it that my family has to change in terms of finances and lifestyle if I start this venture?”
SO here we are at the end of how you can check your preparedness to be an Entrepreneur.
Three simple questions are all you need to answer (there are more at the end of the article if you want to take it a step further 😊)
Entrepreneurship is your calling, and it is you who must be positive than anyone else to move forward.
When I quit my job to start my first business, I didn’t answer any of them.
But as I kept maturing as a business owner and started getting into new businesses, I started answering the above questions for myself.
Well! I am not exactly sure about some of the answers, but then deep down, when I know, I have to start my entrepreneurship journey now.
Similarly, you, too, should be sure about the arduous yet fun journey you plan to take.
Some call it soul searching. Others call it self-introspection.
I call it, “I am procrastinating.”
I give myself a mental kick, and then I am ready to get started 😊.
You are the one responsible for the consequences of your action– hence, take a call only when you are ready for it.
The Action list - How to improve your risk taking ability?
At the end of each chapter, I will provide you with an action list to gauge your learnings from the section.
Consider the action points as – your “to do” list.
Before I list my action points for this chapter, I was hoping you could get a notepad, piece of paper, or anything you can write or type (i keep forgetting that we live in an IT era :)).
- Action Point 1: Answer these questions:
- How much do you believe in your idea?
- Are you willing to go that extra mile to taste success?
- How good are you living outside your comfort zone?
- Do you work hard to get better at your strengths and improve your weaknesses?
- Are you financially prepared to take the risk?
- Is your family aware of your decisions? If yes, how supporting are they of your decision?
If you are positive about all the questions asked above, you are ready to start your journey.
- Action Point 2: Read the book “The Lean Startup” by Eric Reis
I wish someone had given me this book before I started my first venture.
The book helps you understand some considerably basic yet important fundamentals of starting a venture.
You learn from case studies of some of the best businesses and tech startups around the world.
Trust me – while I was reading it, I could not help but ask myself, “Why did I not get this book before I started my first venture?”
The book definitely challenges you at all levels to check your readiness to be an Entrepreneur.
Most importantly, Eric teaches you how to run lean businesses and the journey of a startup from idea to the execution stage.
Any confusion you have about your readiness to be an entrepreneur will be resolved in the book.
No wonder – the startup community so highly recommends ‘The Lean Startup.’