Entrepreneurship: Do You Have What It takes?

Big Money in Simple Ideas 

One doesn’t have to found a Google or Amazon to make big money in America. America’s very open economy allows for quick changes in fortune and most of her super rich are “self-made” businessmen and women (rather than inheritors). Technology has sped up the possibility of quickly creating and spreading new ideas and products to millions or even billions of customers, kicking off tremendous wealth. While the technology field is famous for minting young moguls, riches can be rapidly accumulated in the simplest of fields too, like:

* Writing: After having her book rejected by 12 publishers in 1996, divorced mother, author J. K. Rowling, joined the Forbes Billionaire list 10 years later.

* Clothing: Sara Blakely, a failed law student turned fax machine salesperson, turned $5,000 and a “simple” innovation in women’s garments into a vast fortune within five years.

* Food: 17 year old Fred Deluca borrowed $1,000 and turned it into the humongous fast food chain, Subway.

But Most Businesses Fail

But while it is human nature to focus on success stories, the overwhelming majority of businesses fail outright or enjoy just modest profitability. Don’t connect business ownership with a walk down Easy Street. According to the SBA, half of new businesses fail within 5 years, and only about a third survive past 10 years. When holding up Google as a model business, people rarely pause to think about its extinct competitors like Altavista, Lycos, or Inktomi. Google’s fantastic rise was hardly inevitable. Most businesses are also quite small: some 75% of them have less than one million dollars in revenue (not profit), according the Census Bureau. It is true that most very rich people are business owners but most business owners are not super rich.

And Are Very Hard to Launch

Even when entrepreneurship does lead to financial success it is not for the faint of heart. Top business leaders all share the relentless drive and steely nerves required to face the trials and setbacks of business startups. Walmart Founder Sam Walton said of his company, “Like most overnight successes, it was 20 years in the making.” He began as an underdog, facing competition from established companies like K-mart, and Sam worked seven days a week to match and then surpass them. Walton also took a great risk by pioneering his strategy of situating mega-stores in sparsely populated rural areas. As he suspected, these underserved markets were an untapped goldmine and over time, Walton proved the naysayers wrong. But this process took many years of heartache, hustle, and perseverance.

All the Way Through

After overcoming the initial challenges of getting off the ground, an entrepreneur’s challenges are still formidable. Especially earlier on, he or she may have to wear many hats to keep the fledgling operation afloat. Blakley, who designed a garment’s prototype, took care of her own sales and then ran around North Carolina to find a manufacturer who would take a gamble on her new idea. She even wrote her own patent application because she could not afford to hire an attorney! Being a boss may sound glamorous, but it can be quite lonely at the top, and he should be prepared to deal with difficult employees, demanding customers, and unyielding suppliers. The successful entrepreneur manages to keep it all together while facing the onslaughts of a competitive marketplace.

It Takes Money to Make Money

Money is the lifeblood of any business and under-financing is probably the greatest cause of business failure. Many startups are led by youngsters without families who can afford to go for years without drawing a salary, very common for entrepreneurs. To pay her own bills, Blakley kept on selling fax machines even after her clothing sales were in the millions annually. Rowling, who had to support her two children alone, lived on welfare as she finished her book and chased down publishers.

Owners get paid last, so an entrepreneur needs to find sources of support for both the business and  household until the enterprise earns consistent profits. With a man’s wife’s approval, perhaps they can get by on her salary alone, living very frugally and growing the business slowly, or vise versa. Otherwise he may need to seek a financing partner which can remove both the independence and possibility for the greatest monetary gains that he is seeking.

Hishtadlus + 

Due to the many difficulties in building a business, it is common to hear very successful gevirim acknowledge how clearly, they saw the yad Hashem in their success. With lots of hard work and perseverance, you can follow in their paths and do your hishtadlus toward building great wealth through a business.

Want to dig deeper?

Try these related articles

A Great Business Idea or a Silly Dream?

Dream or Nightmare: The Realities of Opening a New Business

Opportunity Funds: The Cash Stash to Grow With

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