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Why no screening process for entrepreneurship

By

Our friend Liz Strauss was kind enough to introduce us to Carol Roth. She has a straightforward style that I think you’ll appreciate.

By Carol Roth

If you want to become an NFL football player, first you need to be an outstanding college player, usually from a major school.  If you want to become a lawyer, first you need to have excellent undergraduate grades to be accepted into law school, survive school, then pass the “bar” exam.  How about a doctor?  Pre-med courses, med school, internships, etc.

Most careers with big risks and big financial, emotional or achievement-oriented rewards have a screening process, which identifies talent or predisposition for a given career path and also helps those participating in them learn about many aspects of the career before they make a commitment to it. Going through a screening process also ensures you are really, truly interested in that career path. Spending the time and putting forth the full effort that it takes to get through the entire screen helps you demonstrate to yourself that a particular path is something worth pursuing and that it is a good “fit” for you.

So, Here’s the Situation:
Being an entrepreneur is a risk. Starting a small business in a small town is more work than it might seem. Unlike other career paths, you actually have to put your own money at risk (as well as your time and effort) in order to become an entrepreneur.
Sometimes you need to ask not could I be an entrepreneur, but should I be an entrepreneur. 

Why Should You “Screen” Yourself?

The answer is in the statistics.  It is widely known that the majority of businesses fail within a few years. This amount is projected at up to a 90% failure rate within several years of inception. It is impossible to know the actual number, as some businesses go into bankruptcy or some type of receivership, while others close voluntarily when the owners realize they just can’t make the business work. Many more businesses survive, but don’t actually succeed; these businesses just limp along making a modest profit each year, but definitely not an amount commensurate with the effort required to keep that business open. Often, the rewards (financial or otherwise) simply don’t justify the risks.

Where Do You Fit In?

You will fall into one of two categories:

Category A – people perfectly matched for entrepreneurship.

OR

Category B -the majority of the population, who should run (not walk, run) in the other direction from owning their own business. 
Category A people will evaluate the pros and cons, the risks and rewards and ultimately, they will decide that the rewards outweigh the risks.  They will take an educated risk and move forward.  These people have stacked the odds in their favor, per se, by gaining relevant experience, shoring up their financial situation and pursuing opportunities that provide an outcome that is worthwhile for the sacrifices they will be making.

Category B people will react in one of two ways (hopefully!). Then they will either (i) generate a list of areas they need to improve upon in order to increase their prospects for business success and prepare for business ownership down the line; or (ii) seek out a path that is a better fit for them and go on to be incredibly successful in something that they are well suited to pursue, saving lots of money (at least tens to hundreds of thousands of dollars), time and effort. They may even gain a new appreciation for their current job or be invigorated to pursue the next steps in their career.

What Does It All Mean?

Information and knowledge are power.  An entrepreneurship screening process is something that has been so desperately lacking, so that the true entrepreneurs can take educated risks and that the 85-90% of the people who weren’t meant to be entrepreneurs could save their money, their time, their effort and their emotional well being and focus on excelling at something that is a perfect match for them.

How will you screen yourself to make sure that your small business can survive in your small town? 

Carol Roth writes Unsolicited Business Advice (TM) for aspiring entrepreneurs, solopreneurs and other small business owners, at CarolRoth.com. You can find her on Twitter as @caroljsroth.

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About Becky McCray

Becky started Small Biz Survival in 2006 to share rural business and community building stories and ideas with other small town business people. She and her husband have a small cattle ranch and are lifelong entrepreneurs. Becky is an international speaker on small business and rural topics.

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Comments

  1. This is only practical if you’re operating in a thriving economy and you have an abundance of choices. Unfortunately, the current economic crisis has forced people to venture out on their own out of necessity. Screening isn’t practical when you’re unemployed/underemployed. It’s all about survival.

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