An Ode to Entrepreneurs

A Nassim Nicholas Taleb quote, that would work as an apt opener for this post, goes- “Entrepreneurs are heroes in our society. They fail for the rest of us.”

Professionally I have now spent over a decade working closely with entrepreneurs and this good fortune has given me a ring side view of what it is common between successful entrepreneurs.

This post is my hat tip to them and also a primer to what budding entrepreneurs can look forward to as they take the plunge.

Ownership: My career has now spanned working in privately held companies, publicly listed companies and venture capital owned companies.

I have worked with ‘Process Owner’, ‘P&L owner’, ‘Product Owner’ and ‘Values Owners’ and also worked with people who actually own stocks in the companies I have worked for.

Majority of these people, I have found work in these roles passionately and demonstrate a sense of ownership for what they do.

Nothing though quite matches, irrespective of the scale and size of operations that professionals manage, the onus of ownership that falls upon an entrepreneur.

To have and daily demonstrate, acumen and mental fortitude needed to grapple with challenges that customers, competition, regulators and your business processes throw at you, knowing fully well- a failure at any of these fronts will have a direct bearing on your personal earnings.

Failure on any front will have a direct impact on your ability to sustain yourself.

A bad quarter and there may not be another quarter.

You are the know all and end all of everything for you are the Owner.

Managing Uncertainty: No entrepreneur I know, ends his day without trying to solve a problem/firefight a crisis they had in their ‘In Tray’ at the start of the day. A new or an unforeseen problem everyday.

Every day brings about a challenge, the scale and its impact may vary, that can not be delegated or can be categorized as ‘Not my job’.

World is complex and running a business is the polar opposite of running an experiment in a controlled environment.

The crown of ‘Unknowns’ that make up for the life of an entrepreneur goes to Cash Flows.

The non-linearity and the unpredictable nature of when the money will come and of expenses that cannot be timed or planned for.

They demonstrate skill, temperament and the wherewithal to hang in there when the money tap dries out.

A Nous for Finance: Irrespective of the nature of business or the primary skills that they bring to the table, entrepreneurs are masters of managing the life blood of their business- money.

The ability to raise money, deploy it efficiently and keep an account of it to the last penny.

Nothing quite builds the discipline and skill to manage capital than the knowledge- a penny wasted is a penny less in your personal income.

The stake diluted for equity- loss of share in the business, the interest cost on the credit line- hits the cash at disposal, an expense incorrectly recorded- impacts the tax to be paid.

They understand everything and are masters of the art of capital management.

Conviction to Bet the House: They know the working of their business like no one else, they know what it takes to run it in a complex and an unpredictable landscape, they know how to raise and optimally deploy capital and they have experienced the payoffs of getting it all right.

All this augments the risk appetite of entrepreneurs that cannot be matched by any performance linked incentive structure for professional managers.

This is one of the fist things I learnt as a professional, entrepreneurs get like no one else does- what is risk and more importantly what it entails.

They never stop having an expansion plan or stop working on ideas.

Entrepreneurs never stop doing what they do- take risk.

They never retire.

Humility: They are and they come across of supremely confident, confidence that innate and also that comes from having pulled it off, beings; sure of what they are doing and backing themselves with their own money.

The one aspect of their personality that is often overlooked is their humility.

Their acceptance of the ‘unknown unknowns’.

What one may see as a superstitious streak- religious motifs adorning their offices or personal beliefs in astrology, are indicators of entrepreneurs conceding to the one non-controllable that has a disproportionate say in outcomes- luck.

They live what Richie Benaud said of captaincy- Captaincy is 90% luck and 10% skill; but don’t try it without the 10%.

It’s the acknowledgment of the odds, the size of the challenge and the payoffs- not always financial, that fuels their drive.

My selection bias only makes me meet successful entrepreneurs, but that in no way diminishes my respect for everyone who has tried or is trying their hands at entrepreneurship.

It also makes me support policies that would make life easier for people forced into entrepreneurship- farmers in India and policies that don’t force people into entrepreneurship- small time shop owners and Ola/Uber drivers who wish they held regular jobs.

For entrepreneurship is as tough as it gets-let us not grudge the rewards for those who pull it off.