Just like parenthood, entrepreneurship is not for the faint-hearted. (Every entrepreneur will tell you that starting a company is the closest thing to having a baby.) It’s tough emotionally, physically and spiritually. Starting a business requires courage, confidence and a certain amount of risk-taking. That being said, there are many misconceptions preventing people from taking the leap. Now it’s time to set the record straight and debunk the five most common myths surrounding entrepreneurship.
1. You need to wait for the right time
A common misbelief is that you must wait for the right time to launch a business. The truth is that there never really is a “right” time. Usually, you never are going to feel fully ready. The secret is to prepare as best you can and take small steps. You can put it off and plan for months or years, but if you don’t act, you’re not going to get anywhere. If you wait for the right moment, you won’t find it. There isn’t an alarm that will go off announcing, “today is the day!” A steep learning curve exists for new entrepreneurs, and a lot of what you need to know can’t be learned in books. The sooner you begin, the sooner you’ll get closer to your long-term dream of building a profitable, sustainable business.
2. You need to know everything
Real entrepreneurs thrive on being in a constant state of learning. They enjoy creating, improvising and pushing boundaries. In her bestselling book, Rookie Smarts, author Liz Wiseman asks the question, “Is it possible that we can be at our best when we are underqualified, doing something for the first time?” The answer is yes—with the right mindset we can. Being new and even somewhat naïve can be an asset in today’s rapidly changing world. That’s because succeeding at entrepreneurship requires energy, innovation and the ability to push yourself outside your comfort zone. It’s often not what you know, but how fast you learn that counts.
3. You need to be a risk-taker
In general, entrepreneurship is considered a risky proposition. However, contrary to popular belief, truly successful entrepreneurs tailor their decision-making process to reduce risk. For instance, entrepreneur Richard Branson believes in minimizing risk. In his blog, he writes,
For example, when we started Virgin Atlantic, the only way I got my business partners in Virgin Records to begrudgingly accept the risks involved was by getting Boeing to agree to take back our one 747 after a year if things weren’t working out as we hoped. To this day, with giant, capital-intensive ventures like Virgin Galactic and Virgin Voyages, we always spend a lot of time in finding inventive ways to mitigate the downside.”
Successful entrepreneurs follow a calculated learning and experimentation process, actively taking steps to mitigate risk early and continuously.
4. You need a business plan
Do you need a business plan before opening the doors of your new venture? The answer is not necessarily. A study conducted by William Bygrave, a professor at Babson College, examined whether writing a business plan before launching a new venture affects subsequent performance. The analysis revealed that there was no difference between the performance of new businesses launched with or without written business plans. The data suggests that unless an entrepreneur needs to raise substantial startup capital from investors, there isn’t a compelling reason to write a detailed plan. Even more impactful data was uncovered by Anthony K. Tjan, coauthor of Heart, Smarts, Guts and Luck. As part of the research for the book, he and his colleagues interviewed hundreds of successful entrepreneurs around the world to understand better what it takes to build a great business. It turns out that about 70% of the entrepreneurs surveyed who had a successful exit (an IPO or sale to another firm) did not start with a business plan. The majority of successful entrepreneurs spend less time planning and more time doing.
5. You need a huge budget
You don’t necessarily need millions of dollars or venture capital money to start a business. Ryan Holmes, the cofounder of Hootsuite, says,” When in doubt, bootstrap. Using your own personal resources is the easiest way to start a business. You don’t have to convince investors about the merits of your idea. You just have to convince yourself.” If you want to go beyond bootstrapping, there are many other possibilities. Incubators and accelerators provide programs and funding explicitly designed to assist a startup company. Crowdfunding platforms like Kickstarter and Indiegogo are also an option. They allow you to raise capital through the collective effort of friends, family and individual investors primarily via social media. Finally, loans and grants are other alternatives. A grant is advantageous because it’s basically like free money that you don’t have to pay back.
To succeed at entrepreneurship, you need dreams and ideas, but you also have to believe it’s possible. As Linda Rottenberg, author of Crazy Is a Compliment, says in this Harvard Business Review article, “you don’t need a hoodie to be an entrepreneur.” More and more women and people over the age of 50 are starting businesses. Everyone can get the skill set and mindset of an entrepreneur. You just need extreme passion, confidence and the willingness never to give up.
If you’ve been thinking about being your own boss for a while but aren’t sure if it’s the right time, download my free resource: 5 Signs It’s Time to Leave Your Soul-Sucking Job!