Being an entrepreneur is not for everyone. In fact, sometimes the best decision one can make is to NOT attempt a startup. So how do you know if you have what it takes to be a successful Founder? Here are 7 necessary characteristics and conditions that will increase your chances of success.
You have minimal baggage in your life, e.g. no oppositional spouse, no crushing mortgage, minimal debt, no drug habit, and relatively low current monetary needs; and you can exist for a while without a day job. You haven’t yet become a Porsche aficionado; your old Corolla is fine. Or, if you are in the lucky club that is born into family wealth that gives you financial freedom, be thankful. However, always keep in mind that your goal should be to expand what you have been entrusted and not to burn through your inheritance pursuing a dream for which you are ill suited. Even the richest people are well advised to set loss limits on any investment of money and time. At the onset of a venture, either frugal living or a fat bank account will buy you some time to pursue your ambition, but keep in mind that time is the one thing you can never recoup.
You will soon assemble a team, but you have the ability to function in today’s tech-heavy world with minimal support. You can deal with technical frustrations. You do not know what it’s like to have a personal secretary. You may have had a corporate career where you had lots of help with your daily tasks, but you have not let that spoil you. You can operate from a position with no power and prestige. You’re fine in a shared office with all the noise and distractions. You are crafty at seeking help from your friends and acquaintances. You know where to look for startup advice and aren’t bashful about seeking it, even from people half your age. You can communicate efficiently and effectively via all common electronic means. You can tell a great story in person or on the phone. In essence, you can control what is within your control and get things done. You are well above average in practical intelligence.
3. Personal Leadership
You are gifted with extraordinary perseverance and can see a project through to completion. You have physical and mental energy to take on the toughest of assignments. You are resilient; when things go wrong or when you disappoint others from time to time, which will inevitably be the case, you can rebound and continue on the journey. You are a risk-taker by nature; a regular paycheck is not your life’s ambition. You are coachable, which is important, since you would be wise to accept a lot of coaching. You are viewed as smart and trustworthy, to the point you can be very convincing. You are more of a leader than a manager, and there’s a big difference in the two. Most important, you have the ability to assemble, work with, continually improve, and motivate a team that can drive your venture to success. It’s never easy to recruit followers to a risky startup, and you must have the personal conviction in your mission that enables you to land those on whom your ultimate success will depend.
You have earned credentials as a “git ‘er done” person. You may have earned those outside the business world where people have observed you in action. You may have earned them via academic success, more so in leadership roles than your GPA. You may have real experience in the market you intend to serve, but that’s a plus more than a necessity. If you have the ability to drive the venture forward, you can often team up with insiders to fill the gaps in your own history. Many of you may be creating new markets, for which no one has direct experience. Nonetheless, you are standing on the shoulders of the giants who came before you and provided you today’s powerful startup ecosystems. Among the greatest credentials you personally can have is previous successful performance in a measurable operating role working with other people, whether it was your church’s annual pledge drive or being a star project leader in a corporate setting.
You must be able to immerse yourself in the task at hand. That means doing the grunt research, starting with pounding the pavement in customer discovery, finding and leveraging all the connections you need to work your way inside your chosen market, and carefully examining all the competitive threats. If you think you have no competition, you are wrong; doing nothing is always an option for your intended customers. You immerse yourself in your startup not at your desk, not at the whiteboard, and not in meetings. You do so by placing yourself wherever the action is, from major conventions to individual interviews. You must have the moxie to throw yourself into the game, be a great listener, and be able to connect the dots toward a viable concept. Furthermore, you must be willing to sacrifice whatever else you are doing for a living and demonstrate a 100% commitment to your startup; part-timers rarely achieve profitable outcomes.
6. Analytical Skills
Remember that investors don’t invest in ideas, only in businesses. You must be hard-nosed analytical in your planning to make sure you are keeping yourself on track toward a functioning business with a potential exit value. Early on you will need to create the spreadsheets that stress-test your assumptions and prove, at least on paper, the feasibility of your idea becoming a prosperous venture. This testing should take into account all that you have learned by immersion and should comport to the realities of customer interest and competition.
If your path is a big idea that requires you to raise money, you’ll be able to rely on this early analysis to build a convincing case that an investor will get a venture return. You’ll use it to show how much capital is a reasonable estimate to achieve the end goal, and how you are going to access that capital while also being fair to yourself, your co-founders, and the rest of your team. Everyone in the startup game knows startup spreadsheets are assumptions compounded on assumptions, but, if you can defend your numbers with good analysis, you can get yourself into the game with the resources you need to win.
7. Unique Thinking and A Vision Of How To Start
I suppose it’s obvious that you can possess all of the foregoing qualities and still fail at a startup. You’re in the 90% club if you do. To make it to the top 10% that actually work, clearly you must have a concept that finds market acceptance, that is one you can deliver, and that has bona fide uniqueness. I don’t think that I’ve ever seen a plan that didn’t claim a unique advantage, but it’s better to do enough homework to prove that in advance than to find out later the hard way. You may have all the gifts to be successful but deploy them along with your time and resources on a less than stellar idea. I personally see thousands of startup pitches each year, and it’s hard to show me something that I don’t think I’ve seen multiple times before. But, I know there are plenty of unique business propositions out there, and that often it’s the skills of the founder combined with great execution that provide a sustainable competitive edge for what looks on the surface like an old idea.
One acid test of that is the founder’s plan to start the start. Do you have such a plan? What exactly do you do first? Starting correctly is hard work, but it’s what enables you to finish correctly. It’s the part of the startup universe that flummoxes many potential entrepreneurs. I could give hundreds of examples, but you probably have observed many yourself. If you don’t have that resolved in your mind, be bold in seeking advice. Unless you see little hope for your football team in a particular game, you probably won’t begin with an on-sides kick. Yet I often see founders spend their resources out of sequence and add unnecessary cost and risk purely for lack of having a view of how to start. I’ve written essays on that before, and we’ll revisit that from time to time.
Startups are for the few, not the many. It’s far better to be successful in some other career path if you aren’t the right person to be a Founder.
Make the leap thoughtfully.
This post is guest written by Ben Dyer and was first published here. Ben is an Entrepreneur in Residence at Morris, Manning & Martin, LLP in Atlanta, GA and a partner at TechSquare Labs. The founder and president of Peachtree Software, Ben Dyer is a serial entrepreneur and leading technology advisor. He continues to partner and consult with innovative companies to deliver a better future.