Identification of the Entrepreneur – The ABCs of Entrepreneurship
America is rich with examples of those who created fortunes seemingly out of nothing and in so doing left indelible footprints on the history of American business. Many times we simply refer to these people as entrepreneurs. Often the term entrepreneur is used without a clear understanding of its meaning and without a single definition. Everyone seems to think they know what it means, but when asked, the explanations vary. Maybe no single definition of the unique traits of the entrepreneur can be formulated. Yet, the entrepreneur has been and continues to be a catalyst for change, not only in American business, but business throughout the world.
Many times these people are referred to as “doers” as opposed to “managers” because many entrepreneurs undertake the risks shunned by others in exchange for the potential benefits associated with a successful enterprise. Such a characterization may be understandable because the word “entrepreneur” finds its roots in the French word “entrenpredre” which, roughly translated, means “to undertake.” Yet, simply referring to an entrepreneur as a doer or even a risk taker, while convenient, fails to identify let alone appreciate the nuances unique to an entrepreneur. By the time the entrepreneur has his fame and fortune, the achievements have already been well documented and, other than maybe a few anecdotal stories, few are then in a position to recount what was it that led to the success of the entrepreneur. At that point, society often looks only to the achievements of the entrepreneur rather than the unique traits which helped the entrepreneur realize those achievements. Rather than looking at what these entrepreneurs have done, maybe we should examine what is the make-up of the entrepreneur.
Lawyers, have a unique position to witness, often first hand, the entrepreneur in action. They often aid in the birth and assist during the adolescence of the entrepreneur’s business and, in some cases, even beyond. Our law firm, Berliner Cohen, over the years has witnessed many remarkable successes of these remarkable people, and has come to understand the characteristics unique to them. We are headquartered in San Jose, California, and are part of the Silicon Valley legal community.
The client base of Berliner Cohen, unusual for the Silicon Valley legal community, has allowed us to work with many of these entrepreneurs in a variety of industries. We focus on real estate transactional work, land use work, general business litigation, complex tax, high level estate planning work and advice to privately-held companies. We see many companies that were started by visionaries which are not necessarily related to technology. Many of the business successes have rivaled, if not surpassed, the successes of those in the technology community. A review of the annual list produced by Fortune Magazine of the wealthiest people in the world mentions several from Northern California not directly related to technology, but whose wealth flows from the value of Northern California commercial real estate. The success stories of these individuals who accumulate these vast amounts of wealth are as unparalleled and interesting as any technology billionaire. Seldom do these entrepreneurs inherit their money or count on family money to start their endeavors. To use an often-coined phrase, the wealth that they create they create the hard way, they earn it by starting, developing and prospering businesses. How they do it is not often well documented. Why they do it is even less well known. Many times, they just cannot help themselves and, while the money is a component, often the drive to business success has less to do with the financial reward and more to do with the excitement of the “deal.”
I have had the opportunity to represent and meet some of them. Over the years, I have often asked what their keys to success are. The answers vary, but every answer provides a little insight. The typical folklore is that entrepreneurs are doers not thinkers, are born not made, are inventors not managers, and are risk takers not calculators. Our experience has shown that, while each of these terms may aptly describe some component of what it takes to be an entrepreneur, there is much more. More often than not, these stereotypes fail on closer scrutiny to adequately capture the essence of the entrepreneur. For the most part, these people are dedicated, competent and hardworking business people. Hence, to dispel some of the preconceived notions about who entrepreneurs are and why they succeed, this article seeks to provide the ABC’s of entrepreneurship and some insight into the traits of a successful entrepreneur.
A: Adaption, Not Just Action
Entrepreneurs do act and oftentimes, decisively. Yet, to characterize them as simply action-oriented is remiss. Most successful entrepreneurs think, plan, and then move. Their trail is more defined by deliberate movements predicated on a defined risk analysis, rather than a whim. Their success rests on their ability to adapt to a situation and learn from their mistakes. Seldom do they simply plough blindly ahead. More often than not those who lack this trait and who forge ahead blindly find their failures littering the bankruptcy courts.
B: Bold, But Not Brazen
Almost without exception, each entrepreneur I have met has had a daring spirit. This spirit manifests itself fearlessly against the risk of failure and a confidence in their own abilities and success. Yet, they are seldom foolish or foolhardy or act impetuously or with imprudence. They weigh the factors and make an informed decision when to act. They act out of thought, not instinct. This is not to say that they always succeed. Sometimes they do not. Failure, when it does occur, often results from economic considerations beyond their control, rather than from the paralyzation of inaction.
C: Created, Not Conceived
There is no blueprint for an entrepreneur. Entrepreneurs know no cultural, racial, ethnic, educational, religious or other social boundary. None of their success is predicated upon who their parents were, but rather on their own ambition, expectations and goals. What drives them and the traits that often give them their success include initiative, persistence and creativity.
D: Dedicated, But Not Daring
The accomplishments of the most successful entrepreneurs oftentimes are truly astonishing. Some, in a relatively short period of time, create vast amounts of wealth and their success is often thought to be merely the product of daring endeavors, if not reckless action. Yet, many of the most successful entrepreneurs are much less daring than they are dedicated. Rather than impetuously moving quickly in the face of unknown risk, these people act methodically. They have a vision, they act consistent with the vision, and they are dedicated to achieving their vision. This dedication helps them endure the inevitable lows of the business cycle, which they ultimately must transcend to achieve the success they ultimately obtain.
E: Energetic, But Not Excitable
Almost without exception, those who work for the entrepreneur look to the person almost as an evangelist of the entrepreneur’s business cause. Often the entrepreneur is seen rallying the employees to accomplish their goals and the entrepreneur may often pit the business of the entrepreneur almost on a warlike footing with other competitors. Yet in this role, the entrepreneur is not roused to excitability, but rather is the embodiment of the energy that fuels the business enterprise. The energy of the entrepreneur, not acts of excitement, create long-term success.
F: Failure, But Not By Foible
Not all entrepreneurs succeed. Those who do succeed have previously failed. Often more can be learned from failure than success. The most successful entrepreneurs understand that often failure should be embraced and sometimes an immediate success is viewed with suspicion. Failure allows the entrepreneur to create a knowledge base which, in turn, allows the entrepreneur to focus on how to create success out of failure. This failure is seldom predicated upon foible because to continue to endure with a fundamental weakness in the business plan or business model without adaptation would border on lunacy. Entrepreneurs, while sometimes eccentric, are hardly crazy.
G: Greatness, But Not Necessarily By Genetics
The traits of a successful entrepreneur are often unique to them. These traits seem to develop more from experience and environment than the genetic code of the entrepreneur. Many, if not most, come from humble beginnings. Their children or grandchildren may have a “silver spoon,” but their parents usually did not. Each seems to be unique differently, and often it is only success that successful entrepreneurs share in common.
H: Sometimes Heady But Seldom Haughty
Whether formally educated or not, successful entrepreneurs are almost universally shrewd and intelligent and often seemingly act rashly. They universally respect intelligence in others and recognize that their own success often depends upon hiring employees smarter than themselves. Although never short on self confidence, seldom is the entrepreneur blatantly and disdainfully proud.
I: Innovative, But Not Necessarily the Inventor
Entrepreneurs often do not create the breakthrough idea, but more often are those who can exploit someone else’s good idea. Bill Gates, while adept in software, did not invent or even make the software that Microsoft first sold to IBM. The computer had been around for years before Steve Jobs decided it was time for a personal computer. The McDonald brothers were serving up hamburgers when Ray Kroc was still selling milkshake machines. Entrepreneurship transcends invention. Entrepreneurs innovate inventions.
J: Judgmental, But Not Jackleg
Entrepreneurs are decision makers. When a decision is made, it’s often a product of deliberation, but is made quickly and decisively. Sometimes the decisions may be considered judgmental and oftentimes they are, because entrepreneurs have a certain vision and focus and quickly dispense with anything that detracts from that vision and maybe rightfully so. In making these decisions, they are never jackleg.
K: Knowledgable, But Not Know-It-Alls
Entrepreneurs have a vision and know where they want to go and learn, sometimes by trial and error, how to get there. The best of entrepreneurs do not rely solely on themselves. Rather, they develop around them a competent team to assist them and the best of the entrepreneurs always listen to those who provide advice to them, regardless whether the advice is accepted. Those entrepreneurs who embrace the “my way or the highway” attitude may sometimes succeed, but certainly not always.
L: Less Luck and More Logistics
Many who read about the extraordinary successes of entrepreneurs often come away thinking they were simply lucky or at the right place at the right time. No doubt good fortune is helpful. However, good fortune or luck is more often the product of preparedness. The prepared entrepreneurs are those who are able to quickly recognize and act on opportunities when opportunity is apparent. Their success is not predicated upon chance, but rather on calculation.
M: More Management and Less Magic
No doubt the stellar success of some entrepreneurs almost seems magical. Yet, as we all know, magic is not the product of some supernatural quality or power, but rather the magician’s management of the audience’s expectations and views. What may appear to be a magical act is a product of years of hard work and dedication. Entrepreneurs are no different. What magic they display has a solid foundation in years of hard work.
N: A Nucleus, Not a Nullifier
Entrepreneurs at their very best are able to forge coalitions and assemble groups of people who share the vision of the entrepreneur and are committed to the success of the enterprise. Under these circumstances, the successful entrepreneur becomes the nucleus of the endeavor by relying on the support and dedication of the employees of the enterprise. The successful entrepreneur enhances the contributions of the employees rather than nullifying those contributions.
O: Optimistic, But Not Necessarily Opinionated
The glass is never half empty for the successful entrepreneur. Optimism abounds. Some entrepreneurs run their enterprises with a religious fervor. They believe in what they are doing and in the righteousness of their plan of action. Sometimes, however, this optimism can be misconstrued as being opinionated. No doubt successful entrepreneurs have opinions, but are driven more by vision than opinion. Rather, what is viewed as someone being opinionated is merely someone who is extraordinarily optimistic.
Q: Quizzical and No Quitter
Each entrepreneur has a certain amount of eccentricity. Some may be considered quite odd. Yet, all successful entrepreneurs – whatever their unique personality characteristics – simply do not quit. They are undaunted by challenges, and view failures and defeats as mere learning experiences.
R: Resilient, Not Resistant
The hallmark of any successful entrepreneur is being able to adapt. Nothing in business is static. Change occurs and often occurs quickly. For this reason, even though the entrepreneur may have a particular vision, the successful ones will not be resistant to change and will modify their course to keep the vision in focus. They are resilient and adapt to the circumstances as presented.
S: Steadfast, Not Necessarily Stubborn
All successful entrepreneurs are firm in their belief in themselves and their vision. Often their determination is unyielding. Yet, seldom is the entrepreneur unreasonably or perversely unyielding or mulish. The best of the entrepreneurs recognize when to persist and when to adapt.
T: Typically Tyrannical, But Not Truculent
Every successful entrepreneur is and must be a leader. Some of the most successful ones are able to rally support amongst their employees to face any business challenge. As a consequence, many times the successful entrepreneur is demanding, if not overbearing. No doubt entrepreneurs dominate. Many people see this as tyrannical. While it is often true that the entrepreneur believes that he is absolute in his cause, and unrestrained by conventional wisdom, seldom is the entrepreneur vitriolic or deadly and destructive to his vision in carrying out the business plan.
U: Upstart, But Not Urbane
Entrepreneurs start businesses. Action is their calling. The ones who are the most successful often have meteoric rises in wealth and power and sometimes are viewed as upstarts because of their bold actions. More mature businesses often have an urbane quality to them because they are run by institutional managers and not often by visionaries. Urbanity is not one of the traits that fuels the success of the entrepreneur. Contentment and complacency are curses to the entrepreneur.
V: Vitality, But Not Vitriolic
Entrepreneurs, by their very nature, are energetic, often with dynamic personalities. Their zest for their enterprise has a vitality which is sometimes mistakenly identified as caustic.
W: Sometimes Wayward, But Never Whimsical
Entrepreneurs chart their own path. They display no reticence in following their own vision or inclinations. Many are viewed to be somewhat unpredictable. Some around them find it difficult to see the path being charted by the entrepreneur. However, this unpredictability seldom is whimsical. It is often part of a planned course of action, well thought out and implemented with deliberation.
X: Xenophile Rather Than Xenophobe
Many entrepreneurs are iconoclastic and often are attracted to the unusual rather than the mundane. Seldom is the entrepreneur conventional in style or manner.
Y: A Yielder, Not a Yammerer
Those entrepreneurs who fail often do so because they do not re-evaluate their decisions. Adjustment and adaptation are traits that serve the successful entrepreneur well. Hence, when faced with a conflicting view, the successful entrepreneur will evaluate the information, analyze it and, if the information provides a better approach than that first conceived by the entrepreneur, the entrepreneur will yield to that differing view and direct his enterprise to success. The unsuccessful business person will continue to utter complaints and whine about its predicament and stay steadfast in its original plans.
Z: Zenithal, Not Zero Sum
Successful entrepreneurs want to get to the top of the pyramid, so to speak. Success is their hallmark. Failure, although sometimes encountered, is considered a mere obstacle and never an end result. When faced with difficult business decisions, the successful entrepreneur will always look for a “win-win situation” rather than engage in a zero sum game.
Joseph Dworak, Berliner Cohen partner, has over thirty years of legal experience in representing clients from individuals and small businesses to large, publicly-traded companies in various business disputes, including contract claims, real estate matters, and closely held and family-owned business disputes. Mr. Dworak also has a wide range of experience in both the academic and the professional community, including serving as a Judge Pro Tem, Settlement Conference Judge, and Special Master (appointed by the State Bar for overseeing high tech criminal investigations), in addition to being an Arbitrator of disputes through private and court-coordinated programs. Mr. Dworak has received academic teaching appointments in local universities and community colleges including San José State University and the Small Business Institute at West Valley Community College. He has handled many noteworthy cases and has procured multi-million dollar settlements for his clients. For more information, please contact Mr. Dworak at email@example.com.
©2008 Berliner Cohen. This article is not intended to and does not constitute legal advice or a solicitation for the formation of an attorney-client relationship and no attorney-client relationship is created through your use of the Berliner Site or your receipt of the materials. Attorneys in the Berliner Cohen Litigation Group will be pleased to provide further information regarding the matters discussed in this article.