Dear Aunty B,
I am 25 and have always wanted to be an entrepreneur. I can either go into a large company to get experience before starting my own company, or I can pursue a business plan that I developed in my entrepreneur course at uni.
Like all entrepreneurs, my primary driver is to become wealthy. What do you suggest?
Well, for a start you could learn to write. I had to decipher your email from “warped Gen-Y webspeak” into plain English. Then you could try coming down to earth.
The main driver of most successful entrepreneurs is not to get wealthy. It is to gain independence. Research that I have done with RMIT into the drivers and characteristics of successful entrepreneurs shows while that may include financial freedom, wealth creation is not the primary driver.
Why? Most successful entrepreneurs spend up to 10 years in industry before launching their own business. They are usually very successful and earning a very nice salary when they choose to bail out and start their own business. In fact several years on, even when the business is successful, the entrepreneurs say they would be earning more money if they had not left!
What is more, they usually put everything on the line to start their own business. That is, they risk everything they have. No one does that if money is the only driver.
You are also assuming you are going to be successful immediately. Maybe you will be. Australia’s most successful start-ups do well financially. Again our research shows that nearly all entrepreneurs of highly successful start-ups are taking a salary of more than $100,000 after several years. Most also put their fortune at more than $2 million.
But Ryan, there are hundreds of thousands of businesses not even making a profit.
Now the last thing I mean to do is to discourage you; but make sure you are not star-struck.
A university lecturer told me the other day that he had a wave of students who had joined the entrepreneurial course because they want to get rich. They think they can launch an IPO in two years, he says, running tee-shirt design businesses. Guess what? Most of them barely got a pass for their business plans. Far too unrealistic.
So, feet on the ground Ryan. Yes, you can make a fortune from your own business. But I expect you might be better off clocking up experience in a large company, building your knowledge of your industry and customers and developing a great network of contacts. That way your chances of success will be far greater.