Photo by lazaro
What is that 1 special quality that allows one entrepreneur to succeed over another? Is it hustle, determination, persistence, leadership, or luck? I have seen many startup teams who have received funding fail because they weren’t able to reach critical mass and ran out of cash. I have seen many entrepreneurs fail because they had an entrepreneurial seizure and started a company without actually knowing what they were getting themselves into.
If you want to give yourself the best chance at succeeding in the startup roller coaster, then you need to come mentally prepared. You need to know the edge that a successful entrepreneur has over a Business Owner. You need to know what kind of entrepreneur you are.
The edge is the Entrepreneurial Mindset. A successful entrepreneur builds systems and works ON his company, while a business owner works IN his company. Lets dive into the two different mindsets to examine why the Entrepreneur has the superior mindset.
The Business Owner Mindset
Example: Tony, the SEO professional, excels at his job and works at a large SEO firm
Tony likes his job, is great at what he does, and gets paid a decent $65K salary. Though he likes his job, he doesn’t like his boss because the boss makes Tony work long hours without getting paid extra. Fed up with the long hours and the boss taking all the credit for Tony’s hard work, Tony decides to leave his job and start his own SEO company.
Tony’s thinking: “I’ll just start my own company, hire employees, and pay myself much more money than I was ever paid at my old company.”
Tony quickly brings over 5 clients from his previous company and picks up 5 more clients through his connections for a total of 10 clients. He also hires 2 SEO professionals to join his company and trains them to do client work. Tony does well for the first couple of months, but then unexpected problems begin to arise:
- A client is late on a payment so Tony has to personally call the client to handle the situation
- Tony conducts all of the sales calls because he doesn’t trust his team to sell the services on their own
- Tony hires more team members, but doesn’t have the time to train them all properly
- Tony spends time doing all of the logistical work like finances, setting up meetings, and human resources tasks
- Tony hires more people but has to micromanage all of them because they don’t know what to do on a daily basis
- Tony has to show up to work everyday to make sure people are doing what they need to do
Though Tony owns his own company, he is no better off than he was at his previous job; in fact, I would argue that Tony is worse off because he is working harder and working more hours and has less time for personal enjoyment. Tony has become a SLAVE to his business.
The Problem with the Business Owner Mindset
The problem with the Business Owner Mindset is NOT the long hours or the hard work; on the contrary, the Entrepreneur will spend just as many hours working ON his company as the Small Business Owner spends working IN his company. The following are the key differences between the two mindsets:
- The Entrepreneur works smarter; The Small Business Owner works harder
- The Entrepreneur builds systems; The Small Business Owner hires more people
- The Entrepreneur removes himself from the day-to-day tasks; The Small Business Owner micromanages
- The Entrepreneur spends time hiring the right people; The Small Business Owner feels that he’s the only one who can do the job the right way
- The Entrepreneur understands that TIME is the most valuable possession; The Small Business Owner believes that MONEY is the most valuable possession
The Entrepreneur’s Mindset
Example: Same example and set up as the one above
Tony picks up 1 client that will allow him to sustain life for a period of one month. During this period, Tony focuses on developing systems and processes that will allow him to scale his company and remove himself from day-to-day tasks. By establishing the systems from the very beginning, Tony ensures that all future employees will become indoctrinated in the system-focused culture. Here are some systems that Tony focuses on:
- System for hiring and training employees
- System for sales
- System for project management
- and many other systems that are specific to a company
Once the systems for project management are in place, Tony hires a project management team to do the client work. This allows Tony to focus on sales and bring in more clients. Once the systems for sales are in place, Tony hires a sales team and removes himself from all future sales calls. And so on and so forth…
Just because you start your own company, it does NOT make you an entrepreneur.
Even though you may not own your own company, you CAN still have the entrepreneurial mindset.
Entrepreneurship is not a career; it’s a lifestyle