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Research shows that approximately two-thirds of college students intend to be entrepreneurs at some time in their careers, and three-fourths of high school students say they want to own their own business.  Ninety percent of parents today say they approve of their children pursuing entrepreneurial ventures.  Entrepreneurs are becoming our national heroes, and everyone wants to be one.  

There's a big difference between talking about being an entrepreneur and actually doing it.  o, where does somebody learn how to be an entrepreneur?  From school?  From the Apprentice?  Formal education in entrepreneurship is valuable, but pails in comparison to the experience of starting a company. Watching it on TV is interesting, but come on...nobody starts a successful company from watching a season of the Apprentice.  The best way to learn about entrepreneurship is to actually do it!  

So, why don't more people become entrepreneurs?  imple...it is FEAR...plain and simple. People are afraid of failing, when in fact failing is the best way to learn how to do it better the next time. If you want to be an entrepreneur, be willing to fail...fail early and fail cheaply.  

You need to be willing to fail, but you need to do everything you can to make sure that your new venture succeeds.  The key is preparation.  The better prepared you are before launching a venture, the more likely your new venture is going to succeed.  

The planning process of an entrepreneur is a lot like playing in a "Turkey Bowl" on Thanksgiving morning.  You know what your team wants to accomplish - to score touchdowns and win the game - but your strategy changes constantly based on rain or snow, the depth of the mud, injuries to players, the tactics of the other team, people needing to leave early, and so on.  Throughout the game, you continue to pursue opportunities that were not there when the game started.  If you do something that works, you do it again.  If you try something that fails, you don't repeat it.  If you lose players, you shift other players around.  (You get the idea.)

In a similar manner, successful entrepreneurs apply short-term planning that is opportunity driven.  They continue to amend a portfolio of products and services based on feedback from customers, tactics of competitors, new technology, and missing pieces in the marketplace.  It's like they are running a test kitchen in tandem with their core business; and there is always something cooking in the kitchen.  Sometimes these new recipes become a mother lode for the organization.  Here are some great examples:

Becky Anderson opened a retail bath and body shop, started making her own products, began selling her products to other retailers, and has become one of the largest candle manufacturers in the country.

June Morris, the only female to own and operate a major airline, started her career as a travel agent, launched a travel agency, built a leisure travel business, started an air charter company, and evolved into a full-fledge airline - which she sold to Southwest Air for $139 million.

Mimi Silbert, founder of the Delancey Street Foundation, continually asks herself, "What can I do with the resources I have" - which are convicted felons from the prison system.  Mimi and her convicts have created more than 20 successful, labor-intensive businesses including a moving company, a constructions company, an auto detailing business, a furniture-making factory, Christmas tree lots, etc.

Once a new venture is up and running, successful entrepreneurs must continue to "Live in the Boundary" of their organization and stay close to the wants and needs of their customers.  Through constant interaction with customers, competitors and employees, entrepreneurs should begin recognizing a myriad of new opportunities to grow and expand.  One of the biggest benefits of introducing a new product or service into an established business is that much of the hard work has already been done.  Think about it...thriving companies already have customers, team members, resources, and a strong position within their industry.  Over time, entrepreneurs must continue to (1) develop related products and services to sell to their existing customers and/or (2) utilize their existing resources (team members, plants, technologies, funds, etc.) to cultivate new but related business opportunities.  In other words, DO NOT remain stagnant and constantly plan for opportunities!  Diversifying within an industry provides multiple streams of revenue and reduces the vulnerability of a single product or service.

Scenario #1: While working in an industry, a mid-level manager stumbles onto a business opportunity.  She presents it to her boss and says, "I think this is a great opportunity for us to introduce a new product and gain additional market share."  The boss replies, "We don't do that around here.  That's not the business we are in."  Feeling somewhat dejected, she continues to massage the idea, study the industry, analyze potential customer groups and put resources in place.  Several months later, she has a handful of potential customers who are ready to buy her new products and she is certain that the new venture will work.

Scenario #2: A guy is sitting on his couch watching a football game on a Sunday afternoon.  He thinks to himself how much he hates his job and how he doesn't want to go to work tomorrow.  Suddenly, he has an idea for a new product in an unfamiliar industry.  He thinks to himself, "This is a revolutionary product idea.  I am sure no one has ever thought of this before.  I'm going to make millions."  Without doing any additional research and without knowing any more about the industry, he promptly goes into his bosses office on Monday morning and gives his two week notice.  He is going use the money in his savings account and all of his time to focus on his "new business."

I'm sure you get the point: one is a true business opportunity and one is a pipe dream.  A sound opportunity consists of:

1. A proposition for satisfying an unmet need (or a better way to meet a need)
2. A credible position in the industry (broad and deep industry knowledge/experience)
3. Access to the resources required to implement the proposition (suppliers, partners, funds, etc.)
4. A handful of customers who are ready to buy the product or service right now!

It is vital that anyone who is considering starting a new business understand whether or not they have a great idea or an actual business opportunity.  (There is a HUGE difference between the two!)

Becky Anderson, founder of For Every Body, is a highly successful entrepreneur who spends most of her time gathering critical information about her industry, competitors, suppliers and customers.  Becky says:

You absolutely have to know your industry.  These are questions I ask myself every Monday morning: What do I know today about a competitor that I did not know last week?  I spend hours and hours on all my competitors' websites, studying what they do, what promotions they have, what's working, what's not working, and what press releases they are putting out.  I read three newspapers a day and stay glued to CNBC ince most of our customers are publicly traded.  I like to know exactly what they are doing.  What do I know about our top ten, twenty or thirty customers?  What have I learned about them this past week?  What do I know this week that I didn't know last week about my industry as a whole?  What do I know this week that I didn't know last week about the social, cultural and economic trends that will affect our industry?

Becky's knowledge of her industry has lead to phenomenal relationships with customers, suppliers and industry leaders and helped For Every Body become one of the largest and fastest growing candle manufacturers in the United States.  The stories of the vast majority of successful entrepreneurs contain a similar sentiment about "working in the field," and "Live in the BoundaryLive in the Boundary."  Entrepreneurs that fail, on the other hand, often retreat deeper and deeper into the center of their organization as it expands.  Hence, critical information about the industry comes to them fourth or fifth hand from people with limited power.  Before long, the key strategy makers are out of touch with market realities and cannot respond fast enough to changing conditions.  Entrepreneurs need to reside in the boundary of their organization - where their customers, products and competitors meet.

In order to be successful, it is critical that entrepreneurs spend a considerable amount of time on the edge of their organization - rather than in the center - gathering market information for decision making and strategic planning.  Carl Winefordner and Frank Herrmansen, founders of Crank Brothers, are superb examples of this practice.  Carl is a mechanical engineer and Frank is an industrial designer - both are avid cyclists.  Together they have created elite, state-of-the-art bicycle parts including pedals, wheel sets, seat posts, pumps and tools.  Most of their products have been "born out of frustration" while riding together and with other cyclists.  Carl believes "it is very difficult to crate great products in an area in which you don't personally participate."  Their website sums up their attitude: Above all, we are impassioned people; our work is our life and we live our work.  This in itself is what ignites and makes every idea and product a reality.

Successful entrepreneurs continue to experience their industry first hand by "Live in the Boundary" of their organization as their business grows.  Within organizations, there is a geographical space; the center is the furthest away from customers; the boundary is the place where customers and products interface.  Living in the boundary, rather than in an office, provides personal and up-to-date information about new innovations, reactions from consumers, tactics of competitors, changing conditions and new business opportunities.

Abraham Lincoln is a perfect example of someone who thrived as a result of "living in the boundary."  According to Lincoln, the best way to assess an opportunity was to gather data personally.  During his first few years in office, Lincoln spent more days out of the White House than he did in it.  He inspected every state regiment that passed through Washington, D.C., he spent time with the troops in their encampments, he visited the wounded in hospitals, he met with cabinet members in their offices and Generals in the field, he spent days in the telegraph office at the War Department to obtain real-time information, he studied new weaponry and even took charge of several battles, coming under fire on several occasions.  This approach gave Lincoln first-hand information for quick decisions and effective strategies without having to rely on second- or third-hand information from others.

As entrepreneurs grow their companies, it is important that they never lose touch with their organizations.  Decisions are best made in the field, interacting with customers, vendors, partners and stakeholders.  Living in an office with minimal outside contact is a sure-fire way to lose touch with the needs of an organization.

The vast majority of successful entrepreneurs have worked in the industry in which they start their businesses.  Those who haven't held a job in their industry are serious and frequent product consumers.  Living in the industry exposes future founders to the products, services, suppliers, competitors, key customers and delivery systems.  Also important, being in the thick of the action give aspiring entrepreneurs ideas to contemplate and test while still drawing a paycheck.  In nearly every success story, this "higher level of knowing" reveals the missing piece that leads to the business opportunity.  Here are two typical examples:

Bill Kilburg, founder of Hospitality Performance Network (HPN), spent 17 years in the hotel industry as a bellhop, a financial assistant, a controller and a CFO.  After buying 22 hotels of his own, he saw weaknesses in the sales companies that were booking his facilities; he knew he could do a better job linking businesses with meeting sites and hotel rooms.  Thus came the genius behind HPN.  During 2009, HPN booked over 3,000 conferences, $100 million in hotel rooms, and realized increased sales during a year when the hospitality industry was down.

Likewise, Michael Hyacinthe spent nine years in the military prior to creating Urban Liberty, a fashion company that caters to men and women serving in the armed forces.  The idea germinated while Michael was overseas and had difficulty finding "off-hour" clothing that represented his New York culture.  He has now partnered with the military to open stores on bases around the world, as well as a retail websitewhere military personnel can acquire the latest leisure fashions while serving abroad.

Bill and Michael were only able to create these thriving companies because they were already in their industries and recognized the opportunities.  HPN and Urban Liberty never would have been realized without that industry knowledge.

If you are wanting to start your own company, but are coming up short on ideas, then take a look at the industries that you are most familiar with.  Look for new opportunities, untapped markets, or ways to better offer a familiar product or service.  This will hugely increase your odds for success.

Over the past 20 years, we have interviewed and profiled hundreds of entrepreneurs from every industry imaginable.  From all of the stories we have collected, we have identified eight core leadership practices that appear over and over again and that all of these entrepreneurs have used to build and grow their companies. These practices are the differences that make the difference when it comes to launching a successful company.  When these keys are applied in starting and growing new ventures, the probability of success goes up dramatically; when these factors are absent, the probability of staying a small sole proprietorship or failing altogether is high.

These success practices are organized around four leadership processes: preparation, partners, performance and purpose.  First, preparation prior to launch is half the battle.  Many of the ventures we have seen fail have been launched prematurely - before all the critical pieces are in place.  Second, finding the right mentors, advisors and team members is a huge part of beating the odds.  Third, working with great passion and tenacity, and becoming the low cost operator in the industry, are critical to successful company performance over time.  Finally, entrepreneurs who maintain a crystal clear purpose of serving customers and the broader community do better than those who lack this focus. 

Our goal with My New Enterprise is to provide you access to some of the most successful entrepreneurs and the specific practices that they have used to build their companies.  Our experience has been that lessons on entrepreneurial success can best be taught by entrepreneurs who have built amazing companies and who have a great story to share.  

Entrepreneurial practices are not just for start-ups.  It is quite common to find that large, bureaucratic companies are less efficient than small, entrepreneurial based companies.  However, the size of the company is not the critical determining factor in whether a company can successfully innovate and operate efficiently.  It is a matter of being entrepreneurial. 

There are many small companies that behave like large, inflexible bureaucracies.  There are also many large corporations that behave like small entrepreneurial firms.  The telling question is: Do entrepreneurial practices permeate the organization?  Although it is hard for gigantic conglomerates to run like small businesses, it can be done.

A great example is W. L. Gore and Associates, the most innovative company in the world according to Fast Company Magazine.  Bill and Vieve Gore endowed the business school at Westminster College, so we enjoy a close relationship with the Gore family and organization.  With 8,000 associates in 45 countries, W. L. Gore is a beehive of entrepreneurial activity.  The company has no hierarchy, all associates work in teams, every associate has time to innovate each week, and only 150 to 200 people work in a given location.  If an associate generates a business idea and can assemble a team, the company supports the innovation.  W. L. Gore has created products like Gore-Tex outerwear, Elixir guitar strings, Clean Stream Filters and dozens of other market-dominating products.

As a result of the entrepreneurial practices that permeate the organization, W. L. Gore is able to operate a very large organization much more efficiently than the typical large, bureaucratic organizations found in "Corporate America."  This lack of hierarchy and intense focus on entrepreneurial practices fosters (and even insists upon) constant innovation.  How would large organizations benefit if their focus turned from bureaucracy to innovation?  How would their shareholders benefit?  How would our economy benefit?  We need more companies like Gore!

 

Interest in entrepreneurship is booming!  More people than ever before are trying to start and operate their own business. Statistics from the U.S. Bureau of the Census and the Bureau of Labor Statistics show that 500,000 people each month are in the process of launching a new venture.  As a result, millions of households in this country are having experiences with entrepreneurial activities. 

The attitude of the up and coming workforce is particularly telling:approximately two-thirds of college students intend to be entrepreneurs at some time in their careers, and three-fourths of high school students say they want to own their own business.

Entrepreneurship is a vast frontier of freedom.  It discriminates against no one.  it matters not if you are young or old, male or female, black or white, Asian, Hispanic or Native American.  Anyone with an idea and a strong work ethic can enter the entrepreneurial theater.  Consequently, more women and other minorities are launching new businesses.  In the past twenty years, the number of firms owned by women has more than doubled in the United States.  The number of people they employ has grown four-fold, and their revenues have grown five-fold.  Business launched by females are outpacing those started by men.  Companies owned by women now account for nearly 30 percent of all businesses in the United States.

This is great news!  I firmly believe that entrepreneurship is the key to new innovation and job creation and is the solution to our country's economic challenges. 

Over the weekend, my wife and I went out to dinner with a group of friends.  We came across a new restaurant and thought we would give it a try.

The restaurant appeared to be well appointed and I was looking forward to a good meal.  Except for one other small group of customers, the restaurant was virtually empty.  Despite the low occupancy, there was a staff of at least six employees that seemed all too disappointed to be bothered by yet another group of paying customers.  (Sense the sarcasm.) 

We were poorly greeted and told that if our group of eight people wanted to all eat together, that we would have to sit at different tables or would have to pull several tables together.  We wanted to eat together, of course, so we proceeded to pull several tables together as the wait staff observed.  (Mistake #1)

We were all handed our menus and given 15 minutes to decide on our selections before a server came back to take our order.  (Mistake #2)  The menu prices were unusually expensive.  I don't mind paying more, as long as the food is good.  My wife and I explained to our server that we just wanted to share an entree.  We were told that we would be charged $3.00 extra in order to share.  (Mistake #3) 

The food was adequate, but certainly not worth the money we paid.  I was never asked how my meal was or offered any dessert.  (Mistake #4)  I asked the server how long they had been in business.  She responded that they had only been there since February.  I asked if business was good and she responded that we had just missed the dinner rush.  (I doubt it.)

Companies all too often make the mistake of thinking that all their value is in the sale of their product.  Whereas, we as customers feel that much of the value is in the level of service that will accompany the product.  Poor customer service will always devalue the product being offered, regardless of how good the product actually is.  That restaurant could have served me the best tasting food that I had ever eaten, and it wouldn't have mattered.  I was so disappointed with the service that I wasn't able to focus on the real value of the food.