It is a common misconception that entrepreneurs are only successful because they love to take big risks. The adage, if you want to win big, you must play big. But entrepreneurs are not big risk takers on average. You will always have an outlier that risks it all for that one product launch.
I have heard countless stories of someone sleeping on the floor of their one-bedroom apartment, refusing to buy a bed because they were investing it all in their company. We love those success stories, but for those of us who do not love gambling, there still is hope that entrepreneurial spirit lives in you.
To start, entrepreneurs typically only take big risks when they feel that the odds are in their favor. And by odds, I mean we have researched, prepared, practiced and marked the deck we are playing with. We are not into taking a shot in the dark. We have considered all the options and made the most informed decision.
No, it does not always work out, but we are not walking into the casino dumping $10K on black just for the thrill like it often is made to seem.
Entrepreneurs are focused on limiting losses. It is not always possible, but there are backup plans, safety nets, and rainy-day funds put into place for these reasons. Start-ups might not be comfortable and that’s the name of the game when it comes to building a business from scratch, but even in that scenario, we typically have calculated how much we are willing to lose before diving in.
You do not need to be jumping out of airplanes and riding a high at the casino to be a successful entrepreneur. I cannot tell you how many business coaches I went through who were always convincing me to just put their next fee on my last available credit card and it would make the difference between me being broke now and rich after their coaching.
Success still comes from careful planning, cash flow management, diversification, adaptability, and reinvesting in your business with a strategic plan in mind.
The moral of the story is, that even if you feel more conservative, it does not mean you should not follow your dreams of owning your own business. A love affair with risk is not the recipe for success.