My business partner David used to say, "The deal of a lifetime crosses your desk every week," and I think that is one of the best pieces of advice there is.
What David was saying, of course, is opportunity is all around you, if you are willing to look and grab it.
And both those things are important.
What happens far too often is that people get set in their ways. It could be out of habit — "this is what we have always done." But far too often it is out of fear. Fear of the unknown. Fear of risk. Fear of failure. Fear of uncertainty.
But ironically failure is a key part of entrepreneurial success.
The best entrepreneurs deal with uncertainty not by trying to analyze it or preparing for every contingency or predicting what the outcomes will be. Instead, they:
- Learn from what they find,
- Build off that learning, and
- Act again. (And the cycle keeps repeating.)
And they take tiny steps at each part of the process, keeping their risk to a minimum.
Here's How It Works
Say you are thinking of opening an Italian restaurant downtown. If you followed the approach of the best entrepreneurs your first step would not be to sign a lease and buy equipment. It would be to talk to potential customers.
"I think I would like to open an Italian restaurant downtown, if I did would you be interested in coming?"
The next step? You learn from the last one. What did those potential customers want? In the case of the potential restaurant concept, there really are only three possible responses:
- What a great idea.
- Maybe I'd eat there.
- No, I would probably never give you a try.
You'd learn from each response. Let's begin with "no." You want to find out why someone rejected the idea. It could be that there are already a lot of Italian restaurants — at various price points — in the area, and potential customers have no interest in trying a new one because they already have their favorite(s).
At this point, many potential entrepreneurs make a critical mistake. They say, "ah, but they haven't seen my vision. Once they do, they will be beating the doors down to get in." That almost never happens. Going ahead with exactly the same idea that people have told you they do not want, is the fastest way I know to lose a fortune.
But perhaps those restaurant-goers say, as they reject your idea, "You know, there really isn't a place around here to get a good steak." That response could take you in a different direction, one that, as my partner David said, you need to be open to.
If you get a "yes" or a "maybe" when you ask about opening an Italian restaurant, you then take another small step toward your goal. You might ask, for example, should we be open for both lunch and dinner or only dinner? And you keep asking questions — and evaluating the answers — until you are convinced you are on to something or that it is time to find another idea.
Some people would look at all the "no" answers they got as a failure. The best entrepreneurs don't see it that way. They see it as another fact they can build on in creating something new.
If you don't make failures a part of your success, it is less likely you are taking the kind of risks required that often are the key building blocks to creating significant entrepreneurial successes.
Michael W. Sonnenfeldt is the founder and chairman of TIGER 21, the premier peer-to-peer learning network for high-net-worth first generation wealth creators. He is the author of the book Think Bigger: and 39 Other Winning Strategies from Successful Entrepreneurs. (Bloomberg)