Many people dream of becoming entrepreneurs, believing they have what it takes to start a company and turn it into a profitable business. While anyone can start a business, not everyone will succeed.
Research from Harvard Business School Professor Shikhar Ghosh shows that as many as 75 percent of startups fail. According to Zippia, 22 percent of small businesses fail within their first year, half fail within five years, and about two-thirds fail within 10 years.
Given these statistics, the question arises: What does it take to be a successful entrepreneur? What steps can those aspiring to start their own business take to increase their chances of success?
Who Is an Entrepreneur?
An entrepreneur is someone who starts a business venture, usually in the form of a company that creates and sells a product or offers a service. Entrepreneurs are often seen as innovators who identify a problem or an opportunity and develop a unique solution.
In the online course Entrepreneurship Essentials, it is explained that “entrepreneurs—whether individuals or teams—actively look for opportunities or discover them while working. They form ideas about what customers want or need and how to provide value.”
Successful entrepreneurs don’t just act on their ideas. They first make sure there is a demand for what they are offering. One way they do this is through testing. According to Entrepreneurship Essentials, entrepreneurs “gather people and invest money to see if customers will value the product, and if they can produce and deliver it at a reasonable cost. They often find new or better ideas once they enter the market.”
What It Takes to Be an Entrepreneur
Do you dream of becoming an entrepreneur and starting your own company? In addition to having a business idea, you will need certain skills and qualities to succeed.
1. Key Qualities and Behaviors of Entrepreneurs
Researchers have long tried to identify the traits that make some entrepreneurs more successful than others.
According to *Entrepreneurship Essentials*, there is no single personality type that guarantees success. However, many successful entrepreneurs share certain characteristics.
Some behaviors linked to entrepreneurship include curiosity, team building, structured experimentation, adaptability, decisiveness, persistence, and recognizing patterns.
Although some people may naturally display these behaviors more than others, they can all be developed through training and practice.
2. Critical Entrepreneurial Skills
In the early stages of starting a business, entrepreneurs often have to wear many hats. Before hiring staff for accounting, marketing, and product development, you may need to handle these tasks yourself.
Developing certain skills before starting your business can greatly improve your chances of success. Here are some of the key skills every entrepreneur should have:
Communication skills are needed daily when working with vendors, investors, customers, and your team.
Organizational skills help you work toward your goals efficiently.
Time management skills are crucial, especially early on when you are juggling multiple responsibilities.
Data-driven decision-making enables you to make informed, measurable choices about your business.
Strategic thinking helps you spot opportunities and threats that guide your decisions.
Basic accounting knowledge is essential until you can hire someone to manage your finances.
Resilience is necessary to overcome challenges, as all entrepreneurs face setbacks.
3 A Solid Business Idea
For your business to succeed, your plan must revolve around a strong opportunity. According to *Entrepreneurship Essentials*, an opportunity is a business idea that allows you to sell a product or service for more than it costs to produce and deliver.
An opportunity is more than just a product idea. It involves a plan for how your venture will attract, keep, and reward everyone involved, including customers, employees, investors, and suppliers.
Even after identifying a promising business idea, it is important to validate it before committing resources. Once the business is running, you must regularly evaluate whether you need to adapt to new opportunities or challenges.
4. Funding and Resources
Finally, to get your business off the ground, you will need funding. You will need resources to purchase equipment, develop your product or service, improve your offerings, and streamline your processes. The amount of funding needed depends on the type of business and the industry.
For some entrepreneurs, self-funding is an option. They may set aside enough money to cover their living expenses while getting the business started, as well as the costs of launching it.
Self-funding is just one option. There are many other ways to fund a business, such as:
– Getting a loan from the Small Business Administration (SBA)
– Raising money from investors
– Applying for grants (especially for nonprofits)
– Crowdfunding
– Using a line of credit
Each funding method has its pros and cons. Self-funding gives you complete control but puts all the financial risk on you. Raising capital from investors helps share the risk and might speed up the launch, but requires giving up some control. Ultimately, you need to decide what works best for your situation.
Your Path to Entrepreneurship
Many people have great business ideas but lack the skills to make them happen. Others have the skills but no idea to pursue. And even those with the right idea and skills can fail if they don’t secure funding. Successful entrepreneurship requires a balance of all these elements.
