Each month in this column, I ask a different question to you, the ExitEvent Entrepreneur. Thought provoking questions that are meant to get you to sit back and think. Each month I offer insight into the question, along with common mistakes made by (us) entrepreneurs, and a key take-away for you to think more about. My goal – to increase your self-awareness as an entrepreneur and a leader.
Insight— Jim Collins has written some of the best-selling business books ever, to include Built to Last, Good to Great and Great by Choice. I know many entrepreneurs who have benefitted from his work and many more who will in the future.
One of my favorite questions from him is “Are you confronting the brutal facts?”. Entrepreneurs, and especially startup entrepreneurs, are among the most optimistic, the most energetic, and the most glass-is-99%-full personalities on the planet. We emphatically believe fully in what we are doing and nobody can stop us from achieving our dreams!
Common Mistake— Or can they? Or can we, stop us from achieving our dreams? Yes and yes.
You see, vision without execution is hallucination. Optimism without the ability to confront the brutal facts is like going to the bank machine over and over in Vegas and thinking the next time you place a bet you deserve to win! Attempting the same thing over and over expecting different results is, you guessed it, insanity.
Key Take-away— Here are the brutal facts:
- 50 percent of all business fail within their first 5 years
- 70 percent of all businesses fail within the first 10 years.
- For the first time since they started keeping statistics, more businesses shut down than started up (470,000 shut down, 400,000 started up) on an annual basis (although there is positive change in this statistic coming).
- In 1989, 10.6 percent of all households led by someone less than 30 years old held a stake in a private enterprise, that number has dropped to 3.6 percent today.
- The absolute majority of VC backed companies fail.
Embrace the entrepreneurial spirit and guts you have, it is what makes you unique and your company high potential. Continue being the optimist, I am a glass 99% full guy who will never change. I do believe the fly buzzing around my house is just trying to find a way out, not trying to disrupt my life. I look for the best in everything and everybody.
I have learned that living in an idealistic entrepreneurial world is way too risky by itself. The failure statistics don’t lie. Industries change, they get disrupted. Hmmm…I wonder if any of you are trying to disrupt an industry today. By confronting the brutal facts, you put yourself back in control of the decisions you have to make to do something about them, before you must do something about them, before it is too late.
Eternal optimists and entrepreneurs, remember for every one of you there is a competitor somewhere trying to put you out of business before you even get started. I learned a long time ago that when I put my head in the sand and completely ignored what was happening around me, eventually something would happen that would make me change my ways. Combine the best of both worlds: build a great entrepreneurial company that changes the world, while being willing to confront the brutal facts along the way. That combination is similar to a top athlete who has more talent than anyone else and is willing to work harder than them in practice, an unbeatable combination…nothing insane about that!