Penelope Trunk:
A lot of people who would like to start a business think the task is too daunting. But following a passion is not as high risk as you may think. Conventional wisdom about entrepreneurs being big risk takers and living on the edge is not all that realistic. In fact, there are ways to minimize the financial risk and emotional drama of going after your dreams. And, most of the skills you need to be an entrepreneur, you can teach yourself.
Alex Shear launched a production company that completed the documentary, ‘Kokoyakyu: High School Baseball,’ which is on PBS. The topic appealed to him, in part, because of his love of baseball. ‘There’s so much failure in baseball,’ says Shear. He wanted to know how players deal with it. In the meantime, he had to deal with those same issues himself, starting a business to make the documentary. Like many people, he’s not a fan of huge risk: ‘I didn’t know what I was getting into. If I knew I was going to have to move twice, sell my car, and go broke, I probably wouldn’t have done it. You need to be stubborn and thickheaded and not think things through all the way,’ he advises.
In fact, research supports this advice. Here are steps you can take to make starting a company less nerve-wracking:
Choose the lowest-risk version of your dream. Someone might say, for example, I want to start a restaurant, but I have no money. This will be very difficult because restaurants require a lot of cash up-front but are not particularly appealing to investors.
In a case like this, Saras Sarasvathy, professor at the University of Virginia’s Darden School of Business, asks people to look inside: ‘Why do you want to open a restaurant? Is it because you love to cook? Then you can have a catering business out of your home. Is it because you have a great location? What else can you put at that location that would be more likely to succeed?’
Have basic skills in the field you are choosing. Sarasvathy uses the analogy of cooking a meal to describe the entrepreneurial way of thinking. Some people have a list of ingredients on a recipe and follow its steps exactly. Other people walk into a kitchen, see what ingredients are on hand, and whip something up. If you want to start your own business, you should be a person comfortable with no recipe. ‘But,’ Sarasvathy cautions, ‘you need to know how to cook.’ Both types of people probably will come up with good meals if they have cooking skills, and both will come up with bad meals if they don’t. Continued…
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