Updated: Apr 8
What is an Entrepreneur?
Canada’s online small business magazine, About.com, says, “Essentially, an entrepreneur is a person who starts a new business venture. However, we tend to think of entrepreneurs as people who have a talent for seeing opportunities and the abilities to develop those opportunities into profit-making businesses”.
If this is true. then using the word failure in relation to an entrepreneur would be an oxymoron. However. being reasonable individuals we know the reality of the challenges that we, as entrepreneurs, face in building a successful business.
Research indicates that at least 75% of small businesses fail within the first two years so we need a proven formula for success if we are to beat the odds.
The Wall Street Startup Journal gives us some great advice on pitfalls to avoid if we want to start and maintain a successful venture. As an entrepreneur myself I know that good preparation is one of the key functions in achieving success in business. This includes the preparation of a detailed business plan comprising timeframes, objectives, costs and expenses.
In addition. having a good network provides much needed expert advice that comes in handy in areas of uncertainty and helps to bolster confidence. We need as much help as we can get. Knowing and understanding the market is also important in driving a successful venture.
Understand Your Environment
Understanding the market that you're trying to penetrate will give you an advantage in strategically positioning your product or service within that market segment. You may not be able to invest in a marketing strategy at the outset, however, having some knowledge of the competition is always useful.
Competitor knowledge will assist you with knowing what segment of the market to target and helps with setting appropriate and comparable pricing. Business leaders, Kotler and Keller suggest that “The (business) must decide where to position its product on quality and price when entering the market”.
Investing in a good marketing strategy will also be of great benefit to your business over the long term. Make sure you have adequate checks and balances in place so you can be flexible and adaptable to changes in the market.
If possible, make sure that you have a sufficient and sustainable source of capital to maintain the business, especially in the first couple of years. If the business is slow getting off the ground there will still be bills and other expenses to pay.
Depending on the type of business that you're creating, the location could play an important role in its wellbeing. Research suggests that entrepreneurs should possess these five qualities for success:
Desire: This is the desire to get away from the regular nine-to-five routine.
Positivity: An entrepreneur always maintains a positive attitude. For an individual to maintain creativity, self-reliance, and adaptability they would need to have a positive outlook. They should not be afraid to fail.
Commitment: The successful entrepreneur is in it for the long haul. They are committed to seeing the results of their hard work and will allow nothing to deter them from their goal.
Patience: In my opinion, patience here suggests tolerance. Tolerance of Risk, Ambiguity and Uncertainty. Successful entrepreneurs carefully assess risks before making decisions. A patient individual would also be tolerant of fluctuations in the market and the stress that comes along with that.
Persistence: “Nothing is ever straightforward or without contradiction or change and the future is unknown” (Rhiannon Williamson). These are very clear allusions to risk, ambiguity and uncertainty. It takes a very determined and committed individual to keep a level head under such circumstances.
Small business growth is on the rise globally and in 2004 Canadian Imperial Bank of Commerce (CIBC) World Markets reported that, since 2002, approximately twenty-five thousand small businesses began operations. As of 2018, there are approximately 1.14 million small businesses operating in Canada.
Additional research into this trend suggests that people are starting small businesses because they want to, as opposed to doing it out of economic necessity. Cases may defer during the current pandemic but overall there seems to be a strong leaning into entrepreneurship worldwide.
The majority of small business owners in Canada are men although women business owners are on the rise. This group has been slow out of the box perhaps due to the challenges they face in obtaining financing for their businesses.
The Task Force of Women Entrepreneurs finds that “...women entrepreneurs are more likely than men to depend on their business earnings and personal debt for financing, women business owners are being held back”.
The current difficult financial climate makes it more likely that women entrepreneurs will rely on credit cards as a source of business funding than their male counterparts. Thirty-four percent of men are deemed more likely to seek business financing whereas only 25% of women do.
This brings home the point of how extremely important sustainable financing is in starting a small business. Lack of adequate financing is having such a visible impact on this demographic, that it was necessary to create a task force to ensure fair and equitable treatment in an attempt to help these entrepreneurs succeed.
There is no magic formula that one can use to ensure success in business. While a simple thought can be the foundation for starting a business, it takes guts, determination, discipline and experience to build it into a successful venture. At KMI, we give you the tools to take your business from idea to thriving success.