The A to Z of the characteristics of an entrepreneur
Much academic research has been conducted to define the characteristics of an entrepreneur. Like an animal in the zoo they have been studied at length by economists, anthropologists, management academics, psychologists, sociologists, historians, finance experts and organisational scholars.
Who are these creatures? Why do these persistent people never know when to give up? What drives them to take risks that ordinary folk find overwhelming? Where do they get that energy? How do they create value from nothing and most importantly … what are the characteristics that define them as an entrepreneur.
As practicing entrepreneurs, lecturers and authors of entrepreneurial books and material, Dr. Neil Flanagan and myself have developed our own view on the A to Z characteristics of an entrepreneur .
Introduction – Characteristics of an Entrepreneur (the A to Z)
Even though entrepreneurial skills can be identified, analysed and taught, we believe that the position of the entrepreneur in society is more aligned to a calling than that of a skill-set. What others may see as ‘a black sheep’ curse, the entrepreneur sees as a gift which is quite possibility, simply an accident of birth. For example, according to the Myers-Briggs personality classifications, entrepreneurs come from fields like the ISTP ‘Craftsman’, ESTP ‘Doer’, ENTJ ‘Field Marshal’, ENTP ‘Inventor’ or the ENFP ‘Champion’ type temperament, which will all gravitate naturally to the entrepreneurial style of endeavor.
Successful entrepreneurs learn to control and discipline their gift and by combining this with a business education (both formal and from the ‘school of hard knocks’) together with a perseverance and an enjoyment of hard work driven by a righteous passion, they eventually craft their success in spite of the many preceding disappointments and set backs.
However, sharing this ‘money accumulating’ space in society are other players, with some like the scammers and value takers, whose view of success is so focused on just the money that they are quite prepared, if necessary, to sell both their integrity and their grandmother in order to have it. As you will see, whilst both this particular acumen and the entrepreneur’s methodology share the same ‘money accumulating’ outcome, each achieves it with an entirely different mind set and approach. Entrepreneurs ‘make money’ – meaning they create value that did not previously exist rather than just accumulating money via schemes and exploiting weaknessess that take from another’s hard earned assets. Following is the ‘A to Z’ of what we believe are the unique and distinguishing aspects, skills and mind-sets of the entrepreneur – the characteristics of an entrepreneur.
1921 By F.Schumpter
Ambiguity is the “doubt about meaning: a situation in which something can be understood in more than one way and it is not clear which meaning is intended”.  Ambiguity usually occurs at times of significant societal, environmental, economic, political, technological or organisational change. Now, whilst periods of change are quite stressful for the vast majority of people, it marks a time when entrepreneurs becomes quite invigorated. Entrepreneurs are people that have a great tolerance for ambiguity . This is because entrepreneurs know that change always brings with it new opportunities and as Albert Einstein observed “In the middle of every difficulty lies opportunity” .
“I am not sure where I’m going but I still prepare myself diligently for the journey every day” PB.
Entrepreneurs have a natural understanding and appreciation of Beachhead Strategies. Beachhead strategies are the strategies that an entrepreneur uses to gain market penetration and customer acceptance for their products. Like the war metaphor they mirror, beachhead strategies aim to secure a foothold as a prerequisite to the main game. Entrepreneurs and generals alike know that the main game is too heavily guarded and fortified for a full frontal attack so they each secure a space in some easily acquired ground and then use that position to eventually strike out for the intended target.
The book “Harvard Business Essentials: Strategy – Create and implement the best strategy for your business” talks about ‘beachhead strategies’  in the light of Carl von Clausewitz’s nineteenth century book on military strategy titled ‘Principels of War’. The authors purport that the lessons learned from Clausewitz’s timeless advice is to ‘aim at the sharp end of the spear where rivals are weak or uninterested in what you are doing.” The book sites many examples of this strategy including Sam Walton’s (Wal-Mart) strategy of opening in small towns that were not served by the formidable rivals like the retail giants, Sears and J.C.Penny.
Once launched, other beachhead strategies that could be adopted by the new venture include: (1) Build momentum not profit (2) Be the topic of conversation (3) Work with your champions (4) Create memorable experiences (5) Create addictions (6) Break habits and break through (7) Remove barriers (8) Linkup with the locals (9) Focus on what matters and (10) Exploit the unforeseen opportunities.
“Every project can be broken into two halves – making a start and all the other stuff” PB
Entrepreneurial endeavour will never happen without it. Commitment is the founding drive of the entrepreneur. Not just the commitment to do – but the commitment to do and then see it through – not just the commitment to see it through but to see it through with everything on-the-line. It is a commitment to the long term, the commitment to never giving up on the dream, the commitment to getting up and starting all over again if fate so decrees.
If commitment is the ‘ying’, then the whole is complete with the ‘yang’ of courage. For one can not exist without the other. That is, courageous people are committed just as committed people are courageous. Now courage is not acting without fear but is rather the ability to look beyond the things that scare you to death and see the things that inspire you to live. For more, see the knol by Sandra Walston on courage.
“More important than all the talent, all the resources and all the opportunities – is a solitary act of commitment” PB
They are driven to take control of their future, to craft their destiny and if needs be, to make sacrifices in the short term for a greater long term gain. Many entrepreneurs hold to the same view as was expressed by Winston Churchill , the wartime Prime Minister of Great Britain, who said “I felt as if I were walking with destiny, and that all my past life had been but a preparation for this hour and this trial.” It is not their business that makes entrepreneurs a champion, they chose the champion’s life from an early age and so developed their character until it eventually becomes self evident.
“Our destiny is the last thing we discover after having prepared for it all our lives” PB
Business schools and corporate enterprises the world over teach the process of managerial or strategic decision making as the basis for all business development. This process starts with clearly defined goals, that translate into specifically defined objectives that inform the strategies and then determine the tactics.
“To build anything, we need to progress down the hierarchical pyramid from purpose to values to goals to objectives to actions – trouble is, our own life is built the other way up.” PB
Entrepreneurs know better than most, the power generated by focus. They define the mantra for their venture and in spite of the many morphs, changes and set-backs they manage to keep everyone focused on the main game. They know how to focus their own lives as well as the lives of others onto the targeted outcome and so penetrate barriers by the concentrated attack on a single point.
Their concentration at times can boarder on obsession as they stick with their passion, in spite of the many distractions, and get the job done. They narrow their living to a few core commitments protecting those at all costs but forgo the fringe and peripheral engagements that can clutter the lives of those less focused and obsessed. These successful entrepreneurs are single minded with a eye-constantly-on-the-prize. They are not easily distracted, they rarely quit and with blinkers on they stay focused on the task at hand until it is done.
“Unfocused energy dissipates whilst focused energy, like the sun’s rays through a magnifying glass, BURNS!” PB
“Life is a vast open plain in which your courage stakes out the boundaries”
“My good health comes from a balanced diet of accepted truth whilst exercising much kindness, integrity and cheer and avoiding those deadly carcinogens of envy, anger, jealousy, revenge, pretence and double-mindedness” PB
Innovation sets the entrepreneur apart from all of their other commercially engaged contemporaries. Entrepreneurs know how to add value by making a product better and getting a target market to demonstrate their appreciation of it by parting with their money. The management theoretician Peter F. Drucker in his book “Innovation and Entrepreneurship: Practice and Principles” describes innovation as what entrepreneurs do. For him, innovation represents “the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or different service … innovation involves, changing the value and satisfaction obtained from resources by the customer” (p. 19-33).
“Creativity is born of a passion to do it right and to do it better” PB
The Nike mantra could so easily be the entrepreneur’s. Entrepreneurs do. Just like Richard Branson says in his book ‘Screw it, Let’s do it’. Entrepreneurs also think, plan, judge, arrange, source, allocate, choose etc … just like everyone else but doing is the priority and often times the first thing done. For the entrepreneur it is more a case of ‘ready-fire-aim’ than it is the more conventionally accepted sequence. Entrepreneurs are action takers and should not be confused with creative day dreamers and idea makers. Entrepreneurs are decision makers and are unafraid of making wrong decisions knowing that these are often necessary in finding the path to the right one.
For the entrepreneur, the decision to just do it is often to do it alone. This is what separates an entrepreneur from a highly competent corporate executive, for the latter on getting knocked back on a proposal will simply shelve the project. This is not the entrepreneurial one. They immediately look for an alternative even if that means putting 100% of their own resources behind the project to make it happen. They believe in the opportunity to the point of going it alone if needs be. ‘Making it happen’ is what the entrepreneur does.
“The suffering born of a tragic event is fate’s doing – the regretful anguish of a missed opportunity, is ours” PB
Herb Kelleher, the entrepreneur who started Southwest Airlines, identifies this keep it real approach in entrepreneurs with what he calls  “a pleasant sense of scepticism”. This mind set can challenge on points of reality without turning negative or destroying motivation. He says that he plays the passionate advocate who applies “sound judgement to focus on the truly important issues, and delivering the type of positive yet challenging scepticism needed to fully explore ideas”
“Reality is in the ‘what is’ not in the ‘what should be’” PB
We think it is truer to say that entrepreneurs do not chose to be leaders but that leadership chooses them. They lead because they are prepared to take responsibility in an effort to get the job done. They lead because, from their objective standpoint, they don’t trust another’s decisions too heavily skewed by political or subjective bias. They lead because others follow, and other follow because they see their own needs being fulfilled in the entrepreneurial direction and outcomes. They lead because in times of great change they are the ones still moving forward, still possessing the energy to work tirelessly to solve the confronting problems. They live in a future that others wish to be guided to.
Leadership for the entrepreneur is not about status but about function. Imbibing a healthy self esteem, they have little need for status. They are not motivated by external acknowledgement but by achieving their own internal measures of success and achievement. Armed with a generalist approach, futuristic mindset, excellent people skills, a penchant for action over words and operating often in high variance industries, the entrepreneur makes for a natural-born leader  .
At the very core of entrepreneurial leadership is problem solving and decision making. If there is a problem – they solve it. If there is a decision to be made – they make it.
Anita Roddick, founder of the global retail chain The Body Shop, says  “I want to define success by redefining it. For me it isn’t that solely mythical definition – glamour, allure, power of wealth, and the privilege from care. Any definition of success should be personal because it’s so transitory. It’s about shaping my own destiny. … Entrepreneurs have this real belief that their lives are about services and leadership.”
“Groups are lead to achievement by good leaders, supported all the way by great leaders but achieve their own success with the very best of leaders” PB
Guy Kawasaki in his book ‘The Art of the Start’  goes further to explain that entrepreneurs can create the meaning, which will become the driving motivational force behind their ventures, in one of three ways
- To increase the quality of life and to change people’s lives for the better
- To right a terrible wrong which is most prominent in the area of social entrepreneurship
- To prevent the end of something good where but for a new innovative approach something beautiful can be made to be sustainable again
“Purpose to Life? How about, never giving up, committing yourself to the continuous development of your allotted talent and being the best possible influence for good in every corner of the world in which you live” PB
If the term ‘faith’ was not already an icon of religion, it would be the mantra of the entrepreneur, because most entrepreneurs would declare, “if faith is an act of believing in spite of the past or present circumstances, a hope unseen, an aspiration unrealised, a destiny unclear – then faith is my mountain”
It is this faith or belief that underpins the entrepreneurial trait to never give up. For what others see as failure the entrepreneur see as either a learning, as a chance for character development or as simply a barren environment or an improper timing. So, they continue doggedly on their quest with great persistence working for the moment when their time will come. Most of all, they never give up and never quit striving for their success.
“Never give up on the hope that ‘Your time will come’.” PB
As Tom Caprel  points out in his article “The Gold, The Opportunist and The Entrepreneur”, those sad creative dreamers that do chase “every pot at the end of the rainbow, will find it devoid of gold but full of broken hearts, dreams and bank accounts … they fail as entrepreneurs because they are enticed by bright shiny objects and seduced by the next new dot bomb and become too distracted by UFOs (Unidentified Flying Opportunities)”
Having said that, entrepreneurs do develop an options portfolio and keep a constant vigilance for significant changes in the environment and/or a chanced resource discovery that may trigger a promotion from option to opportunity. Either way, they are not searching for AN opportunity (like a lottery ticket) but THEIR opportunity (the one that they are uniquely resourced to provide a solution to a need).
“If you are not centre stage in your own opportunity then you are just a bit player in someone else’s.” PB
People and the Entrepreneur
Although it is a common trait amongst entrepreneurs is that they like to be the boss, it does not mean that they are elitist. They need to be in charge for practical reasons and is not a status trip. In fact when in charge, entrepreneurs typically employ an egalitarian style of management. Entrepreneurs are honourable people who would do business on a handshake or promise (if they could) and tend to form strong associations with others who share the same ethos.
Their temperament package radiates a certain charm that makes for binding relationships, which inspires cooperation, confidence and loyalty. It is this genuine relationship that entrepreneurs form with their financiers, partners, vendors, sub-contractors, professionals and employees that supercharges their organisations and though small in numbers is big in stature and capable of taking on the giants in any industry. Being mostly generalists, entrepreneurs have no problems employing people smarter than themselves. In fact, it is almost a prerequisite to their success that they do.
Of all the rare, immutable and un-substitutable resources an entrepreneur can secure to build their enterprise, it is the people resources that is the most valuable. This is why every person an entrepreneur meets is seen as a potential resource or teacher. Entrepreneurs want you to teach them what they don’t know and if they perceive you know too much, then they want to employ you. Right then!
“If you want to achieve something individually great, then don’t attempt it on your own” PB
Entrepreneurs revel in the quirky. They add it to their products, you will find it in the unusual parts of their assortment, your will see it in their marketing and it is the endearing part of their service. It is a form of creative, almost cheeky humor, that can only be produced by a person with boundless self-esteem, who is confident in their offer and who understands that it is this very quirkiness that creates the fond and lasting memory in the mind of their customers.
“The same’ is never recorded – ‘the quirky’ never forgotten” PB
There are hundreds of jobs, sporting feats and activities that we witness every week that we believe are ‘too-risky’ for us, yet ask the expert performing them and they will hardly even acknowledge any risk at all. Their natural gift, training and experience all make it so. So too with entrepreneurs. To the untrained eye entrepreneurs take risks, to the entrepreneur they are simply taking the next challenge after carefully evaluating the risk and deciding to do it based on their ability to accommodate it. Anyway, the entrepreneur places little faith in assets for security, preferring by far their coping ability regardless of the threat.
Just as the concept of risk and reward is fundamental to the finance and investment industry so it is with entrepreneurial living. The entrepreneur is not satisfied with the mediocre life returns of pleasure and comfort preferring instead to strike out for a life of fulfilment, joy, meaning and destiny. These rewards are so highly valued by the entrepreneur that they will risk everything they own to have them. Entrepreneurs then simply invest their lives to attain the highest return and willingly accept the risks that this involves.
“Many a soul is lost to the risk–free life of irrelevance” PB
The art of the entrepreneurial offer is to not fight with competitors on the battlefield of price, but rather to shift the focus to the satisfaction of customer needs. They do this by leveraging subjective or emotive margins. Subjective margins are the margins that entrepreneurs achieve because they know how to perfectly position their offer in an emotive arena where price for the customer is not the issue.
The real issue for the customer is the satisfaction of their emotive need and they will willingly pay a price that has little relationship to the accounting costs of production or the market price of another similar but poorly positioned good or service. The following represent areas in which customers will willingly pay a premium to have their subjective/emotive needs satisfied. (Urgency, Self Esteem, Pain Relief, Fear Mitigation, Scarcity, Unique name, High Emotional Experience, Vital Small Cog, High Sentimental Value or Indulgence)
“The problem with a life ruled by money is that it only sees the price – never the value” PB
For entrepreneurs, timing is everything. Experienced entrepreneurs know that many a successful venture happened because they launched it in the right place at the right time. There often appears to be a large element of luck in these ventures but what is unseen is the preparation time that took place prior to the launch. The gathering of market intelligence, their positioning in the emerging field, the securing of the people resource, the look-out for the environmental trigger, their trial & error a few times to get it right, the organising of their personal life and the thinking through of the business model which all laid the ground work prior to the successful launch. Or as the 1st century Roman philosopher Seneca said “Luck is what happens when preparation meets opportunity.”
“Success is all about timing – being there at the moment when it mattered as well as the 99 times when it didn’t” PB
To a large extent even this Google Knol project is being launched ‘under the radar’. There is very little self promotion being done by Google and very little responce from them when they are attacked. Google’s knol project is quietly adding features to improve the product and gaining traction in the market almost unnoticed by rivals that have too quickly placed it in the non-relevant and non-threat box. Whilst not privy to the Google mind, it seems that there is much more in store for the Knol project that when fully released and promoted it will be too late for competitors to respond.
“Entrepreneur – Revolutionary inside”
As discussed in the introduction, both approaches outlined by Cabrera make money, but each approach is adopted with a quite different mind-set. The entrepreneur makes their money by taking a slice of the added value that they create for their customers via their innovative products and services. To take Cabrera’s words further – “You (entrepreneurs) are not looking at your business venture as a way of extracting value away from others”. Unlike other operators in the field of commerce, entrepreneurs are not in the business of ripping people off.
“There is a vast difference between exploiting an opportunity and exploiting a weakness. The former adds the latter takes” PB
Perhaps the closest entrepreneurs could get to anything resembling this would be the entrepreneurial concept of returnment. That is, to return all those favours and benefits that have been bestowed on the entrepreneur throughout their life, back to a new generation of start-ups by way of angel investing, mentoring and coaching.
“What a fulfilled life it is where work and play mesh so indistinguishably. Where both are pursued with a spirit of excellence, displaying at all times an unconquerable passion and imbibing an endless duty to love. Where every act is an expression of a deep sacred belief, the totality of which is acknowledged by others as the ‘mastery of life’.”
For Anita Roddick  the X factor was obsession and she explains it in this way “Dysfunction is the essence of entrepreneurship. I’ve had dozens of requests from places like Harvard and Yale to talk about the subject. It makes me laugh that ivy leaguers are so keen to “learn” how to be entrepreneurs, because I’m not convinced it’s a subject you can teach. I mean, how do you teach obsession? Because it is obsession that drives the entrepreneur’s commitment to a vision of something new.” She goes on to say that “Potential entrepreneurs are outsiders. They are people who imagine things as they might be, not as they are, and have the drive to change the world around them. Those are skills that business schools do not teach.” She believes that the X factor is passion and imagination.
“The smugly talented know they can do better than those less gifted achievers – but they never will.” PB
Now whilst not part of their natural gift, entrepreneurs need to educate themselves on the other half of business success – business acumen. The cheapest way to learn these skills is through formal education, however most entrepreneurs choose the far more expensive option from the ‘University of Hard Knocks’. Which ever way the learning takes place, these are lessons that must be learned if the entrepreneur is ever going to create a successful and sustainable enterprise.
Another unusual characteristic of the entrepreneur is the concept of self-branding. They share this attribute with the show ponies and the egotists but again for different reasons. Entrepreneurs know that they will be at the epicentre of any new venture and so it is vital that they have a reputation that inspires trust, that demonstrates courage to act alone if needs be, that copes effectively with the unforseen and that can create the future. So, they have no hesitation in placing themselves at the forefront of any option to volunteer, any option for publicity or any option that allows them to demonstrate or build their reputation. It is the ‘hit they take for the team’ even though the team has not yet been formed.
Anita Roddick again “We entrepreneurs are loners, vagabonds, troublemakers. Success is simply a matter of finding and surrounding ourselves with those open-minded and clever souls who can take our insanity and put it to good use.”
“It is a condition of living that we are compelled to withdraw 24hours of time each day from our account at the Bank of Existence. What will you do with that time? Squander it on the fleeting gratification of your senses? Will your use it to acquire those decaying and life-absorbing assets? Will you flitter it on the winds of nothing to do or will you invest it in the incorruptible legacy for a fellow traveler’s betterment.” PB
Z is for Zest
“The zest of life actually comes from having to make a choice, in a state of frailty and in a world of uncertainty whilst being fully conscious of the painful consequences of getting it all so wrong.” PB
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These days Peter Baskerville likes to call himself a New Venture Architect. This is because he is keen to impart the knowledge and insights he has gained from establishing over 13 new ventures (involving over 30 outlets) to help budding entrepreneurs of today design and build sucessful new ventures.
As a teacher, mentor and coach to hundreds of ‘real world’ new venture intenders, Peter now wishes to share his expertise with the millions of intenders scattered across the globe who have been brought together via the medium of the internet. He has contributed many works on entrepreneurship here on Knol and on other content publishing platforms. He fully intends to continue expanding this body of work as well as provide value-added resources via his website, designed to help people start and succeed in their own business.