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Attributes of a Successful Entrepreneur

Becoming self-employed by starting a business, be it a convenience store or service-oriented work, is not an undertaking that many of us can relate to. Many of us are used to working for someone else and having the security of a steady cheque at the end of every pay period. Benefits such as RRSP matching, flexible spending accounts, health and dental insurance, etc. that come with a corporate position are nothing to complain about either. However, being an entrepreneur may provide the freedom to express one’s creativity to the maximum extent, whereas a corporate employee may be limited by the company’s directional objectives.

Knowing oneself is critical to either. I have had the chance to watch two friends transition to entrepreneurs, while leaving behind their degree and job. This post is my observations about what makes such successful entrepreneurs tick. Needless to say, many of the attributes below would benefit any person, entrepreneur or not.

Time Management

Entrepreneurs are willing to work long hours, especially immediately before and after the launch of the business. They are able to modify their lifestyle to accommodate the single-minded pursuit of establishing their business.

Planning and Organization

A good entrepreneur has a profitable plan for the business and also maintains a backup plan (such as emergency funds). They set the short-term agenda to match their long-term plan and stay organized enough to overcome any mishaps that might occur.

Self-Confidence

Unsurprisingly, they have a lot of confidence in their idea and have the ability to push it to a potential lender or business partner.

Communication

A continuation of the above really! A great idea is no good without the skills to express it. Most entrepreneurs are very good communicators. One does not have to be a great public speaker but certain attributes such as being a good listener, patience, politeness, taking a stand for the right things, and willingness to learn from all comers are noteworthy.

Integrity

This trait is essential for any human being but gains significance for an entrepreneur due to the lack of a corporate brand name as support. A good reputation goes a long way and the word of mouth can do wonders in positive and negative ways.

Modesty

An entrepreneur, just like any other person, should be willing to take blame when a mistake occurs and apologize, be it to a customer or employee. Being presumptuous will not take most people very far.

Commitment

There will be times when the business is going through a lean patch and the urge to pack it in will surge. There may be the naysayers who will add fuel to the fire at such times. As long as one had done their due diligence, they should maintain their motivation to stay committed and make the business work. The support of a spouse, friends, relatives, mentors, and/or business contacts is critical. However, staying committed does not mean that an entrepreneur should not reevaluate at any cost or fall prey to the sunk cost fallacy.

Cost Management

Frugality is an oft-repeated word in the personal finance world and it is vital for an entrepreneur. Spending cuts may become essential during bad times, not just on the business front but also on the personal side. Firing an employee to cut back on costs, while taking a Hawaiian vacation with the family will not be good for the team (if one exists) morale. Even if the vacation is funded with money that had been in savings, it may be prudent to postpone the grand “stress-relief” vacation or opt for a less exotic local getaway.

Work/Personal Life Balance

Although successful entrepreneurs may seem to work long hours, they do not do so at the cost of ruining their relationships. They take care to spend time with family and not let them feel ignored. They never forget that the efforts they make to build a profitable business are for the relationships/family and not to supplant them.

Bookkeeping

A good entrepreneur is usually a good accountant or knows one. Maintaining proper documentation is important for determining business performance and to be prepared at tax time.

Are you an entrepreneur or have you watched a close one succeed? What are the other attributes that are necessary for being a successful entrepreneur? What are the pitfalls to avoid?

About the Author: Clark works in Saskatchewan and has been working to build his (DIY) investment portfolio, structured for an early retirement. He loves reading (and using the lessons learned) about personal finance, technology and minimalism.  You can read his other articles here.

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About the author: Clark works in Saskatchewan and has been working to build his (DIY) investment portfolio, structured for an early retirement. He loves reading (and using the lessons learned) about personal finance, technology and minimalism. You can read his other articles here.

{ 12 comments… add one }
  • Steve @ Canadian Personal Finance January 6, 2012, 2:00 pm

    This is a great article, Clark. With the talk recently of executive pay being too high. It is important to recognize the all-around skills these executives have.

  • krantcents January 6, 2012, 2:26 pm

    Successful people generally have excellent judgment either in their decisions or who they surround themselves.

  • Todd January 6, 2012, 2:47 pm

    Great post Clarke, as a entreprenuer who left behind a University degree and many yrs of experience in the IT industry to start a new venture in the construction industry I agree with your successful attributes list. I also have a few of my own to add.

    Innate Business Sense and Entrepreneurial Drive

    This is difficult to explain to people who don’t have it but I will give it a shot. During the past 8 yrs I have built a business from 0 to $1.6m annual sales. During this time I have seen many of my peers also with new business ventures flounder or outright fail.

    One of the main contributing factors for those who succeed is a built in sense of what to do and what not to do and when to do it. I believe that this is a quality that you are born with that can be perfected with education practice and effort. Just as a professional athlete’s body and mind work seamlessly to perform extraordinary feats in their chosen sport, successful entrepreneurs have a similar connection to their business and the environment it operates within.

    The best way to explain a true entrepreneurial drive is to compare it to a persons sex drive or the cravings that a smoker has for nicotine. The drive to create and succeed can take over ones thoughts and actions in a way that could easily be compared to obsessive type illnesses.

    Most successful entrpreneurs are able to find a balance between utilizing their innate abilities and controlling their entrepreneurial drive and replicating this balance year after year.

  • Liquid Independence January 6, 2012, 4:42 pm

    “Destiny is not a matter of chance, it is a matter of choice; it is not a thing to be waited for, it is a thing to be achieved.” – Winston Churchill.

  • Sarlock January 6, 2012, 9:01 pm

    Don’t try and do it all yourself: utilize and empower the people around you.
    I run a company with over 100 employees and there wouldn’t be a chance I could succeed without trusting the people around me to do what they are good at. I know my strengths and my weaknesses and don’t try and do that which I am weak at, I employ others who have strengths in those areas to do it for me and step back and let them do it. Employees and managers will always do things differently than you do, but sometimes better. Step back, don’t micro manage them and instead concentrate on setting the direction and feel of the company and let them fill in the details.
    Delegating is also a great way to spend more time on the golf course and with your kids instead of in the office :)

  • Andrew January 7, 2012, 1:31 pm

    I disagree on the work/life balance comment. Every successful entrepreneur that I know has had to sacrifice a lot in terms of their personal relationships in order to get their business off the ground in the beginning. It’s generally a trade-off unfortunately.

  • Jungle January 8, 2012, 5:34 am

    Sometimes I think I run our personal finance like a business..I can see where this can be bad but also where it can be good:

    Keep expenses low: check
    Increase income: check
    be more productive: check
    find future growth: check
    lol

    There is a lot more potential though with running your own business.

    I would agree that successful entrepreneurs sacrifice their personal relationships for running successful businesses. Unless you can get to a point of putting things on auto pilot, through good management, delegating tasks/jobs, having stable customers/ revenue streams.

    Even after reading Keven Oleary’s book, his wife was really the back bone for his family because he was always away on..business.

  • Promod Sharma | @riscario January 8, 2012, 1:22 pm

    As Andrew notes, in the work/life battle, work wins — at least in the early years.

    The word “risk” doesn’t appear in the post or comments but is important. An entrepreneur is willing to accept risk, including the risk of failure. A successful entrepreneur spots revenue-generating opportunities that others have overlooked or ignored. A successful entrepreneur adapts as the environment changes. A successful entrepreneur experiments, fails, learns and prevails.

  • Clark January 8, 2012, 4:41 pm

    Thanks for all the comments and insight.

  • youngandthrifty January 9, 2012, 2:51 am

    Great article, Clark :)

    It definitely takes a lot of work and a special personality to be a successful entrepreneur.

    I have a lot of admiration for entrepreneurs and I find seeing the drive to succeed very ‘hot’ in men ;)

  • stacie January 17, 2012, 11:14 am

    excellent article, Clark! If you want to become a great entrepreneur these days, you surely need those qualities mentioned above. It is obvious that it takes a lot of work. Famous entrepreneurs like Yuri Mintskovsky or Steve Jobs also worked hard and finally they succeeded in their business. I have a lot of admiration for them!

  • Be Successful June 6, 2012, 7:02 am

    I truly believe that effective time management skills are imperative if you want to be successful no matter what business you are in. The reason that effective and smart time management is so imperative in the work world is because of the fact that time is money and if you loose time you loose money.

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