Not everyone is fit to be an entrepreneur. When you look at the likes of Steve Jobs, Larry Page, Mark Zuckerberg, and Oprah Winfrey, it’s not immediately obvious what traits they have in common, but we know that they have been successful where many others have not.
Mark Zuckerberg is far from charismatic. Oprah Winfrey is not a tech genius. Some entrepreneurs were born rich, while others grew up poor. Some excelled in school, while others either couldn’t or wouldn’t make it through.
There are, however, a few core traits that nearly all entrepreneurs do share. To be an entrepreneur, here are the 5 things you need to be.
#1: Be a Calculated Risk-taker
“Only take on risk when it is greatly outweighed by the potential reward. It may sound simple, but far too many people don’t do a risk/reward calculation and take risks that generate poor outcomes.”
– Carol Roth, author of The Entrepreneur Equation
You’ll find headlines everywhere that say entrepreneurs are risk-takers or entrepreneurs are risk-averse. When you read further into any of these articles, it becomes clear that the answer is somewhere in the middle. Entrepreneurs understand risk and they face it in a calculated manner, driven more by information than raw emotion.
#2: Be an Experimenter
“The way forward is to learn to see every startup in any industry as a grand experiment.”
– Eric Ries, author of The Learn Startup
Entrepreneurs have to be experts in marketing, product development, negotiations, and pretty much everything else under the sun, right? Wrong. Entrepreneurs are not necessarily the smartest people on earth — even if they do sometimes act like they are.
Entrepreneurs have to think like scientists. When they have ideas, they test the assumptions behind those ideas thoroughly. If the results don’t confirm the assumptions, they tweak the idea until it matches reality. This is the core from which pivots, innovations, and revelations are born. An entrepreneur that doesn’t actively look for evidence that disproves their views is destined to fail.
#3: Be Able to Embrace Failure
“If you tune it so that you have zero chance of failure, you usually also have zero chance of success. The key is to look at ways for when you get to your failure checkpoint, you know to stop.”
— Reid Hoffman, co-founder of LinkedIn
Failure is a necessary part of entrepreneurship. Without failure, there is no experimentation. Without experimentation, there is no learning. Without learning, there is no improvement.
I’m not saying that you can’t fear failure. Everyone fears it to some extent, but you have to learn how to overcome your fear of failure. The fear itself is good because it helps you to recognize risk, but it becomes detrimental when it suppresses the analytical part of your brain.
#4: Be a Lifelong Learner
“Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow.”
— William Pollard, chairman of Fairwyn Investment Company
Their education levels may vary dramatically, but entrepreneurs are all lifelong learners. Experimentation is only one part of the learning process for entrepreneurs. After all, those initial ideas have to come from somewhere. Other sources of learning can include listening, observing, and reading.
Because of the wide range of skills required in entrepreneurship, the learning can’t be limited to your own field, either. You need to be able to quickly pick up information from a wide range of topics. If you are a programmer, you may need to learn the basics of SEO or marketing. If you are a salesperson, you might benefit from some accounting and product management knowledge.
#5: Be a Doer
“Most leaders would agree that they’d be better off having an average strategy with superb execution than a superb strategy with poor execution.”
— Stephen Covey, author of The 7 Habits of Highly Effective People
Everyone has ideas. Having an idea is not a differentiator, so — in the grand scheme — ideas are worthless. What makes someone an amazing entrepreneur is how they execute on their ideas.
This is really a combination of two aspects: motivation and tactics.
Motivation is what separates the dreamers from the doers. A true entrepreneur gets out there, experiments, and iterates while the dreamers come up with more ideas or try to improve their current idea purely by doing second-hand research and thought experiments.
Once you have gotten off your idea couch and are ready to execute, tactics are how you decide which steps are worth taking and in what order. There are hundreds of experiments that you could be conducting during any particular day. Choosing the right experiments — the ones that will let you move most rapidly to product-market fit — is vitally important.
Entrepreneurship is not an easy path. These 5 traits should be seen as a bare minimum set of requirements. They are intended to be universal, applying regardless of whether you intend to be a solopreneur or the next Bill Gates.
Do you have all of these traits? Maybe it’s time to give entrepreneurship a try, even if it means just dipping your toes in with a side hustle.
Don’t have these traits? Your honesty will serve you well, and there is certainly still a place in the startup world for you. Being a startup employee can be just as fun as being a founder.
Whatever your path, walk it wisely.