Ways of successful entrepreneurs

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills.
Post Reply
Topic Author
vk22
Posts: 133
Joined: Wed Jun 17, 2015 10:40 pm

Ways of successful entrepreneurs

Post by vk22 »

I have seen 2 types of entrepreneurs (1) Small business (2) Innovation driven. If successful, innovative companies can be more effective than small businesses. More than hustle, these require specific skills and paths people follow. For example, type of early work one does before becoming an entrepreneur. But no point comparing to unicorns like Facebook because they are so rare and not easy paths to replicate.

If you are an entrepreneur or seen successful entrepreneurships, what are some replicable paths?

I am giving a talk as volunteer to high schoolers in the next month on this topic. And personally, I am very curious about this topic too.

thanks
User avatar
White Coat Investor
Posts: 17338
Joined: Fri Mar 02, 2007 8:11 pm
Location: Greatest Snow On Earth

Re: Ways of successful entrepreneurs

Post by White Coat Investor »

Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course
humblecoder
Posts: 1527
Joined: Thu Aug 06, 2020 8:46 am

Re: Ways of successful entrepreneurs

Post by humblecoder »

vk22 wrote: Sat Oct 16, 2021 11:24 am I have seen 2 types of entrepreneurs (1) Small business (2) Innovation driven. If successful, innovative companies can be more effective than small businesses. More than hustle, these require specific skills and paths people follow. For example, type of early work one does before becoming an entrepreneur. But no point comparing to unicorns like Facebook because they are so rare and not easy paths to replicate.

If you are an entrepreneur or seen successful entrepreneurships, what are some replicable paths?

I am giving a talk as volunteer to high schoolers in the next month on this topic. And personally, I am very curious about this topic too.

thanks
I don't understand your initial premise about there being "small business entrepreneurs" and "innovation driven entrepreneurs". This implies that small businesses aren't "innovation driven". Is that what you are talking about?

If you are going to start a business, you better have something innovative that distinguishes you from all of your competitors. Otherwise, why would somebody choose your new unproven business over the other existing businesses out there.

Let's say you want to open up a pizza restaurant. Most areas probably have at least a dozen choices for pizza. In order for your new pizza restaurant to get business, you better offer something innovative that the other pizza restaurants don't have: a better recipe for sauce or dough, some innovative style of pizza, a novel type of oven that makes the pizza cook better, some innovative types of ingredients, some supply chain innovation which allows you to price your pizza better, etc. Otherwise, why would I switch from my tried and true pizza restaurant and choose you over them?

I guess my point is every entrepreneur better be innovation driven, otherwise they are going to get lost in the sea of choices out there.

And to answer your question about "replicable paths", the only replicable path that I see as an entrepreneur is buying into an existing, tried-and-true franchise. Otherwise, you are going to need something different to stand out, which implies that you need to do something that is not replicable.
Yellowjacket1
Posts: 72
Joined: Sat Jul 28, 2018 2:54 pm

Re: Ways of successful entrepreneurs

Post by Yellowjacket1 »

I would argue there are small business owners and entrepreneurs. My father was a small business owner. He opened up a convenience store in an area that was underserved. He had no vision for expanding, franchising, etc, just making a decent living for our family.

On the other hand, I have worked for 3 entrepreneurs. Two had new technologies different from any others. The other entrepreneur had a service similar to many others but he had a cheaper way of providing it. Think Ray Kroc.

The difference, I believe,is that entrepreneurs have a vision for providing a better, cheaper mousetrap.Small business owners are content to follow the established path, replicated in a new or similar location.
Cecelio
Posts: 175
Joined: Sun Jun 06, 2021 10:19 am

Re: Ways of successful entrepreneurs

Post by Cecelio »

My grandfather had a tax advisory business that became an addition on his home. It had a very comfortable feel and grandma would often offer clients lunch or a snack. Close friends of the family also worked there. They eventually sold out to IDS and then Ameriprise, but the feel was still the same.

My father did tax prep by driving to people's homes. The man did over 1000 taxes per season, state and federal, mostly in person, as a side hustle! Most of his clients were his friends and family of friends. He had a full time accounting job with the government, too.

I do network and system administration for medium size businesses with my own twist. I actually show up on site each week and talk with people. How novel!

I think we all have simpler, happier lives with our small businesses. We all really enjoy seeing clients and talking with them. We might not make the most money in the world, but we offer services people value and respect. And we don't have a boss!

I wouldn't call any of that entrepreneurship. Just good business. Porters 5 forces are important, too.
User avatar
Lee_WSP
Posts: 10346
Joined: Fri Apr 19, 2019 5:15 pm
Location: Arizona

Re: Ways of successful entrepreneurs

Post by Lee_WSP »

I can sum it up in a few words.

Fail. Fail again. Keep failing until you succeed.
Deighve
Posts: 99
Joined: Sat Nov 18, 2017 9:30 am

Re: Ways of successful entrepreneurs

Post by Deighve »

White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
I disagree. There is some very good research showing things that increase chance of success in entrepreneurship. Wharton has some good studies n this. You can’t guarantee success but you can take your odds from 20 percent t to 50 percent.
seppatown
Posts: 64
Joined: Mon Jan 05, 2015 1:46 am

Re: Ways of successful entrepreneurs

Post by seppatown »

White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.
I think you could lead your talk with White Coat Investor’s exact words. And then clarify.

I am (currently) a small business owner. My father was an entrepreneur. Neither situation was planned.

There are so many life variables that come together to lead to such outcomes. However, generally speaking, I feel that starting out in a conventional career or job helps. Doubly so if you can gain management experience. Or just have rich parents from the get-go. This is how opportunities are discovered.

Kids should also understand how important failure is, as a primary feature and an experience, in small business and entrepreneurship. Most success stories have been preceded by failure.

Hopefully OP has some personal experiences in order to make his/her stories more relatable to his teenage audience.
User avatar
vitaflo
Posts: 1905
Joined: Sat Sep 03, 2011 3:02 pm

Re: Ways of successful entrepreneurs

Post by vitaflo »

vk22 wrote: Sat Oct 16, 2021 11:24 am If you are an entrepreneur or seen successful entrepreneurships, what are some replicable paths?
I've started two businesses, my wife has started three. We both have one each currently. My experience is there are 3 things that will define whether a business makes it or not:

1) Product
2) Networking
3) Dumb Luck

Usually you need a good product, though not always. Who you know and who knows you (networking) is key and will help open doors that otherwise were not there. But Luck is the thing that people don't want to admit and tends to have an outsized influence. It's also not something that can really be "taught" (how do you teach someone to be in the right place at the right time?).

Also, since someone else brought up failure, and people talk a lot about how a high percentage of businesses fail, it's important to define what is considered a "failure". I've never lost money on any of my (of my wife's) businesses. They've all been profitable. But we have closed them down or pivoted when we saw the writing on the wall. Are those businesses failures? Were they failures if we used them to spin off new businesses that were more successful (even tho the original business shut down)? Not every business closing means someone poured their life savings into it, lost it all, and had to go back to a desk job. This goes back to WCI's post that every path of business and entrepreneurship is different and basically non-reproducable.
make_a_better_world
Posts: 292
Joined: Mon Mar 18, 2013 11:55 pm

Re: Ways of successful entrepreneurs

Post by make_a_better_world »

I have been a co-founder of a business that was sold to private equity.

Best chance for success: make something people want.

Best way to convince investors: your business is making money and growing.

Best management philosophy: merit based.

There is no secret trick. Ideas are close to worthless by themselves. It is execution. Can you figure out what needs to be done and can you get it done?
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Ways of successful entrepreneurs

Post by KlangFool »

vitaflo wrote: Sat Oct 16, 2021 7:31 pm
But Luck is the thing that people don't want to admit and tends to have an outsized influence. It's also not something that can really be "taught" (how do you teach someone to be in the right place at the right time?).
vitaflo,

Yes and no. No, you cannot teach luck. But, if someone is NOT READY to capitalize the opportunity when it shows up, LUCK is no good to the person.

My mother (a small business person) has a favorite saying that she taught us.

Even if the gold is falling from the sky, you still have to run and catch faster than others to get it.

KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Ways of successful entrepreneurs

Post by KlangFool »

White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
White Coat Investor,

I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.

KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Ways of successful entrepreneurs

Post by KlangFool »

vk22 wrote: Sat Oct 16, 2021 11:24 am I have seen 2 types of entrepreneurs (1) Small business (2) Innovation driven. If successful, innovative companies can be more effective than small businesses. More than hustle, these require specific skills and paths people follow. For example, type of early work one does before becoming an entrepreneur. But no point comparing to unicorns like Facebook because they are so rare and not easy paths to replicate.

If you are an entrepreneur or seen successful entrepreneurships, what are some replicable paths?

I am giving a talk as volunteer to high schoolers in the next month on this topic. And personally, I am very curious about this topic too.

thanks
vk22,

Check out this group in your area. It is a way to social network the start-ups in your area.

http://www.productcamp.org/

KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
moneyflowin
Posts: 276
Joined: Sat Oct 16, 2021 6:14 am

Re: Ways of successful entrepreneurs

Post by moneyflowin »

Entrepreneurs are risk takers; small business owners may or may not be.

My father has owned small businesses. He didn't like risk. He's the type to buy things with cash instead of credit cards. He just wanted the business to produce income for a comfortable retirement. He was not out to revolutionize anything or change the world.

Entrepreneurs have a different mindset. Let me ask you, if you had $160M, would you retire? Or would you use it invest in new, high-risk businesses? And when that business nearly fails, you put more money into it? I bet 90% of the population would retire. Elon Musk made $160M from selling Paypal and used it to create SpaceX and effectively buy Tesla, a couple of massive gambles. Tesla nearly went bankrupt and he had to put more money into it save the company.

That's clearly a different mindset than the average small business owner.
User avatar
AerialWombat
Posts: 3102
Joined: Tue May 29, 2018 1:07 pm
Location: Cashtown, Cashylvania

Re: Ways of successful entrepreneurs

Post by AerialWombat »

deleted
Last edited by AerialWombat on Sat Feb 05, 2022 3:01 pm, edited 1 time in total.
This post is a work of fiction. Any similarity to real financial advice is purely coincidental.
veindoc
Posts: 834
Joined: Sun Aug 14, 2016 9:04 pm

Re: Ways of successful entrepreneurs

Post by veindoc »

Risk taking and optimism.

My husband has a ton of ideas. It seems every year he comes up with something along the lines of, you know what needs to be invented? And they all sound plausible. However he will never act on them. He starts ruminating about the money involved, gets nervous, starts with the self-doubt and then ultimately someone else executes or we realize it wasn’t as plausible as we thought it was.

He has been musing about another idea that actually I am excited about too and I asked him how much he was willing to lose. What would be tolerable? The answer was at first zero but in further reflection he said maybe $50,000. So now we are working on fitting his idea to match a $50,000 investment. But I give it a 50-50 shot he will back out because even losing 50k would be too much for him.
User avatar
AerialWombat
Posts: 3102
Joined: Tue May 29, 2018 1:07 pm
Location: Cashtown, Cashylvania

Re: Ways of successful entrepreneurs

Post by AerialWombat »

veindoc wrote: Sat Oct 16, 2021 9:10 pm But I give it a 50-50 shot he will back out because even losing 50k would be too much for him.
“If you’re not willing to risk being homeless, you don’t have what it takes to be an entrepreneur.” -AerialWombat
This post is a work of fiction. Any similarity to real financial advice is purely coincidental.
User avatar
HanSolo
Posts: 2286
Joined: Thu Jul 19, 2012 3:18 am

Re: Ways of successful entrepreneurs

Post by HanSolo »

KlangFool wrote: Sat Oct 16, 2021 8:27 pm
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. ...
I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.
I think the "middle ground" between the above two positions is that entrepreneurship, as a mindset, can be learned, but learning by osmosis (growing up in a business family) gives one an incredible advantage over learning from a book or teacher; and, in any case, it can never be completely formulaic... you'll need to think of things that others haven't thought of and/or aren't willing to try... and those are the things you have to come up with on your own (i.e., can't be taught).

As for developing the mindset... Napoleon Hill interviewed various successful entrepreneurs to try to understand how they got there. He noticed certain commonalities, and documented them in his book, "Think and Grow Rich", with the intention of helping others find their way. Some have found this book to be informative and/or inspiring. I suspect that some may be better at applying the principles than others (according to aptitude, drive, and, as mentioned, childhood influences... maybe also genetic predisposition... just speculating here). It's just one book, but maybe worth a look.

By the way, there's also a program called Junior Achievement that exposes high schoolers to business principles in a "learn by doing" approach.
Strategic Macro Senior (top 1%, 2019 Bogleheads Contest)
sweetnpsycho
Posts: 24
Joined: Sat Jan 04, 2020 7:29 pm

Re: Ways of successful entrepreneurs

Post by sweetnpsycho »

Being an entrepreneur depends on 1) personality or 2) need. The people drawn to entrepreneurship when they don't need and can stick with it have a certain personality:
- conscientious -- making themselves work when they don't have a boss
- autonomous / low agreeableness -- wanting freedom to do their own thing and is comfortable going against the crowd

The higher risk and higher reward start-ups tend to be innovative and the people drawn to them are also:
- open -- receptive of new experiences and ideas and are willing to admit when they're wrong and pivot to something more promising

People who don't need to be entrepreneurs but do so are very different from those who are forced to be entrepreneurs. The people forced to be entrepreneurs may or may not have the above-mentioned personality. Lots of times, these people are immigrants and operate small restaurants and dry cleaners. Those small business are very similar to their competitors and those business owners tend to work a lot. But if done right, they can be quite profitable.

Not matter which type of entrepreneur you are, a previous post specified what it takes to have a chance of success: ​
make_a_better_world wrote: Sat Oct 16, 2021 8:21 pm I have been a co-founder of a business that was sold to private equity.

Best chance for success: make something people want.

Best way to convince investors: your business is making money and growing.

Best management philosophy: merit based.

There is no secret trick. Ideas are close to worthless by themselves. It is execution. Can you figure out what needs to be done and can you get it done?
I second this. If you decide to pursue entrepreneurship, the most important thing is to offer something people want. If you're able to offer something other people want that your competition can't offer (maybe through better prices or better features), you have something you can run with. That's just the beginning. You will have to decide on how to capitalize on that market and there's going to be a lot of trial and error.

However, entrepreneurship is risker with a smaller pay-off compared to working a regular job. If you're in technology, you'll likely make more money working for FAANG / FAGMAN than working in a start-up. This is due to higher salary and the ability to compound the higher salary. Good investors do better with guaranteed capital. It is popular advice not to quit your job when you work on your own ventures.

However, I encourage those in their teens and 20's to start business as that's the age a person is able to take the most risk and walk away unscathed. Those who do so will learn a lot about business and the knowledge will pay off in the future. Warren Buffett started businesses when he was younger and that helped him become the investor he is today. He said, "I really think, if you want to be a good evaluator of businesses — an investor — you really ought to figure out a way, without too much personal damage, to run a lousy business for a while." Most start-ups are lousy businesses. The knowledge is especially important for those who will go into venture capitalism.

Most likely, very few of your high school kids will attempt this as it is much easier to watch YouTube and post on social media than to create. But the ones who will make the extra effort on their own to satisfy their own curiosity will likely get far in life financially.
User avatar
vitaflo
Posts: 1905
Joined: Sat Sep 03, 2011 3:02 pm

Re: Ways of successful entrepreneurs

Post by vitaflo »

KlangFool wrote: Sat Oct 16, 2021 8:27 pm
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
White Coat Investor,

I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.

KlangFool
Klang, you somewhat disagreed with my notion of luck, but being born into a business family is certainly luck! Plus it has built in networking.

I understand the notion that "luck is when preparation meets opportunity", and while there is something to that, there is a lot in a successful business that is just lucky that nobody else can recreate. Certainly knowing how to take advantage of that is a skill in its own right, but I've had so many chance meetings, encounters, surprises, etc in my businesses that it would be very hard to "teach" that to someone starting out. "Hey just get lucky and you'll be successful!" is hard to quantify. "Take advantage of good things when they happen to you but realize they may not" is probably more realistic (and maybe what you were saying in general).
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Ways of successful entrepreneurs

Post by KlangFool »

vitaflo wrote: Sun Oct 17, 2021 9:08 am
KlangFool wrote: Sat Oct 16, 2021 8:27 pm
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
White Coat Investor,

I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.

KlangFool
Klang, you somewhat disagreed with my notion of luck, but being born into a business family is certainly luck! Plus it has built in networking.
vitaflo,

I know that you do not mean it. But, please explain to me how is this equal to luck?

A) I lost my father to lung cancer during childhood. My widowed mother had to run her small business and raised 6 kids on her own.

B) The male of my community had a life expectancy of 55 years. 1/3 of my elementary classmate lost their father due to sickness and poverty. So, (A) is very common.

C) As an oppressed minority, the MAJORITY use the power of the government to take away our education opportunity, our jobs, and our businesses.

D) My ancestor came from a region that had 800+ famines across 800+ years.

We were in business because we had to be resourceful in order to survive. By default, if we did nothing, we would not survive.

We are risk takers because we had to. We had no choice. The alternative is do not survive.

If you come across a community of risk takers, you would find that they are from a historically resource poor environment. They had to take risk in order to survive.

KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
smitcat
Posts: 13227
Joined: Mon Nov 07, 2016 9:51 am

Re: Ways of successful entrepreneurs

Post by smitcat »

KlangFool wrote: Sun Oct 17, 2021 9:21 am
vitaflo wrote: Sun Oct 17, 2021 9:08 am
KlangFool wrote: Sat Oct 16, 2021 8:27 pm
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
White Coat Investor,

I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.

KlangFool
Klang, you somewhat disagreed with my notion of luck, but being born into a business family is certainly luck! Plus it has built in networking.
vitaflo,

I know that you do not mean it. But, please explain to me how is this equal to luck?

A) I lost my father to lung cancer during childhood. My widowed mother had to run her small business and raised 6 kids on her own.

B) The male of my community had a life expectancy of 55 years. 1/3 of my elementary classmate lost their father due to sickness and poverty. So, (A) is very common.

C) As an oppressed minority, the MAJORITY use the power of the government to take away our education opportunity, our jobs, and our businesses.

D) My ancestor came from a region that had 800+ famines across 800+ years.

We were in business because we had to be resourceful in order to survive. By default, if we did nothing, we would not survive.

We are risk takers because we had to. We had no choice. The alternative is do not survive.

If you come across a community of risk takers, you would find that they are from a historically resource poor environment. They had to take risk in order to survive.

KlangFool
That is a very unfortuneate summary of your life experiences. And yet you are not at all a risk taker - quite the opposite.
Proving what?
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Ways of successful entrepreneurs

Post by KlangFool »

smitcat wrote: Sun Oct 17, 2021 9:27 am
KlangFool wrote: Sun Oct 17, 2021 9:21 am
vitaflo wrote: Sun Oct 17, 2021 9:08 am
KlangFool wrote: Sat Oct 16, 2021 8:27 pm
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
White Coat Investor,

I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.

KlangFool
Klang, you somewhat disagreed with my notion of luck, but being born into a business family is certainly luck! Plus it has built in networking.
vitaflo,

I know that you do not mean it. But, please explain to me how is this equal to luck?

A) I lost my father to lung cancer during childhood. My widowed mother had to run her small business and raised 6 kids on her own.

B) The male of my community had a life expectancy of 55 years. 1/3 of my elementary classmate lost their father due to sickness and poverty. So, (A) is very common.

C) As an oppressed minority, the MAJORITY use the power of the government to take away our education opportunity, our jobs, and our businesses.

D) My ancestor came from a region that had 800+ famines across 800+ years.

We were in business because we had to be resourceful in order to survive. By default, if we did nothing, we would not survive.

We are risk takers because we had to. We had no choice. The alternative is do not survive.

If you come across a community of risk takers, you would find that they are from a historically resource poor environment. They had to take risk in order to survive.

KlangFool
That is a very unfortuneate summary of your life experiences. And yet you are not at all a risk taker - quite the opposite.
Proving what?
smitcat,

1) What do you call a person that go to a foreign country after high school for their college education with little to no money? No scholarship. Compete with the locals for part-time jobs and earn their way through college.

By the way, I started a software company selling vertical market software while I was in college. But, I was not successful.

2) Go across the world a few times to find new employment and start a new life?

Not a risk taker?

I had taken enough RISK through my life.

3) I do not have a romantic view of RISK taking. I have a pragmatic view of RISK taking. I take RISK when the ROI is big enough.

KlangFool
Last edited by KlangFool on Sun Oct 17, 2021 9:52 am, edited 1 time in total.
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
User avatar
AnnetteLouisan
Posts: 7239
Joined: Sat Sep 18, 2021 10:16 pm
Location: New York, NY

Re: Ways of successful entrepreneurs

Post by AnnetteLouisan »

The ones I have seen identified a market opportunity (need or want not being filled) or pricing anomaly and addressed that opportunity.
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Ways of successful entrepreneurs

Post by KlangFool »

Folks,

It is very simple.

If a person can get a job earning X in annual salary, there is very little incentive for the person to start a business earning X per year. The RISK and WORK does not justify the REWARD. Most people would not do it. The opportunity and reward has to be significantly greater than X.

So, in general, entrepreneurs are those folks that faced discrimination, glass ceiling, limited job opportunity and so on. They cannot use the traditional career path in order to be successful.

https://en.wikipedia.org/wiki/Masayoshi_Son

Masa Son is a Korean Minority in Japan. He started SoftBank because he had limited job opportunity in Japan due to his Korean minority status.

The simple fact is some folks do not have the same job opportunity as others. In order to improve their own opportunity, they "create their own job". Aka, they started their own business.

KlangFool
Last edited by KlangFool on Sun Oct 17, 2021 10:08 am, edited 2 times in total.
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
smitcat
Posts: 13227
Joined: Mon Nov 07, 2016 9:51 am

Re: Ways of successful entrepreneurs

Post by smitcat »

KlangFool wrote: Sun Oct 17, 2021 9:50 am
smitcat wrote: Sun Oct 17, 2021 9:27 am
KlangFool wrote: Sun Oct 17, 2021 9:21 am
vitaflo wrote: Sun Oct 17, 2021 9:08 am
KlangFool wrote: Sat Oct 16, 2021 8:27 pm

White Coat Investor,

I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.

KlangFool
Klang, you somewhat disagreed with my notion of luck, but being born into a business family is certainly luck! Plus it has built in networking.
vitaflo,

I know that you do not mean it. But, please explain to me how is this equal to luck?

A) I lost my father to lung cancer during childhood. My widowed mother had to run her small business and raised 6 kids on her own.

B) The male of my community had a life expectancy of 55 years. 1/3 of my elementary classmate lost their father due to sickness and poverty. So, (A) is very common.

C) As an oppressed minority, the MAJORITY use the power of the government to take away our education opportunity, our jobs, and our businesses.

D) My ancestor came from a region that had 800+ famines across 800+ years.

We were in business because we had to be resourceful in order to survive. By default, if we did nothing, we would not survive.

We are risk takers because we had to. We had no choice. The alternative is do not survive.

If you come across a community of risk takers, you would find that they are from a historically resource poor environment. They had to take risk in order to survive.

KlangFool
That is a very unfortuneate summary of your life experiences. And yet you are not at all a risk taker - quite the opposite.
Proving what?
smitcat,

1) What do you call a person that go to a foreign country after high school for their college education with little to no money? No scholarship. Compete with the locals for part-time jobs and earn their way through college.

By the way, I started a software company selling vertical market software while I was in college. But, I was not successful.

2) Go across the world a few times to find new employment and start a new life?

Not a risk taker?

I had taken enough RISK through my life.

3) I do not have a romantic view of RISK taking. I have a pragmatic view of RISK taking. I take RISK when the ROI is big enough.

KlangFool

"1) What do you call a person that go to a foreign country after high school for their college education with little to no money? No scholarship. Compete with the locals for part-time jobs and earn their way through college."
Fairly typical from where we started.

"By the way, I started a software company selling vertical market software while I was in college. But, I was not successful."
When you have been in half a dozen industries and started a haof a dozen business's you are a risk taker.
When you sell Amway , start a car detaiuling company, and mow lawns, etc while going to college you are fairly typical.

In general you are about as far away of a risk taker as they come.... Jobs, homes, investing, change, etc.
Your posts all indicate a single tracked path most all of your adult life with responses that are always very ridged and closely defined.
Perhaps you were a risk taker for a period of time a long while ago but success is not something that typically comes up quickly in life.
jayk238
Posts: 911
Joined: Tue Jan 31, 2017 12:02 pm

Re: Ways of successful entrepreneurs

Post by jayk238 »

KlangFool wrote: Sun Oct 17, 2021 9:50 am
smitcat wrote: Sun Oct 17, 2021 9:27 am
KlangFool wrote: Sun Oct 17, 2021 9:21 am
vitaflo wrote: Sun Oct 17, 2021 9:08 am
KlangFool wrote: Sat Oct 16, 2021 8:27 pm

White Coat Investor,

I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.

KlangFool
Klang, you somewhat disagreed with my notion of luck, but being born into a business family is certainly luck! Plus it has built in networking.
vitaflo,

I know that you do not mean it. But, please explain to me how is this equal to luck?

A) I lost my father to lung cancer during childhood. My widowed mother had to run her small business and raised 6 kids on her own.

B) The male of my community had a life expectancy of 55 years. 1/3 of my elementary classmate lost their father due to sickness and poverty. So, (A) is very common.

C) As an oppressed minority, the MAJORITY use the power of the government to take away our education opportunity, our jobs, and our businesses.

D) My ancestor came from a region that had 800+ famines across 800+ years.

We were in business because we had to be resourceful in order to survive. By default, if we did nothing, we would not survive.

We are risk takers because we had to. We had no choice. The alternative is do not survive.

If you come across a community of risk takers, you would find that they are from a historically resource poor environment. They had to take risk in order to survive.

KlangFool
That is a very unfortuneate summary of your life experiences. And yet you are not at all a risk taker - quite the opposite.
Proving what?
smitcat,

1) What do you call a person that go to a foreign country after high school for their college education with little to no money? No scholarship. Compete with the locals for part-time jobs and earn their way through college.

By the way, I started a software company selling vertical market software while I was in college. But, I was not successful.

2) Go across the world a few times to find new employment and start a new life?

Not a risk taker?

I had taken enough RISK through my life.

3) I do not have a romantic view of RISK taking. I have a pragmatic view of RISK taking. I take RISK when the ROI is big enough.

KlangFool
With all due respect, your argument is largely based on self selected information.

you obviously have been through a lot but so have plenty of other immigrants.

The difference between why some immigrants are able to get a leg up and have a career or whatever is largely based on luck to some extent.

Just getting into college for example can be a result of some form of luck- family upbringing, cultural values etc.

Im not saying you had 100% luck. but there is a spectrum beween being born an orphan with HIV at birth with no social structure and no family support/values and someone born with a silver spoon. We are all on this spectrum. And if are, then you've been the beneficiary of some luck
smitcat
Posts: 13227
Joined: Mon Nov 07, 2016 9:51 am

Re: Ways of successful entrepreneurs

Post by smitcat »

KlangFool wrote: Sun Oct 17, 2021 10:06 am Folks,

It is very simple.

If a person can get a job earning X in annual salary, there is very little incentive for the person to start a business earning X per year. The RISK and WORK does not justify the REWARD. Most people would not do it. The opportunity and reward has to be significantly greater than X.

So, in general, entrepreneurs are those folks that faced discrimination, glass ceiling, limited job opportunity and so on. They cannot use the traditional career path in order to be successful.

https://en.wikipedia.org/wiki/Masayoshi_Son

Masa Son is a Korean Minority in Japan. He started SoftBank because he had limited job opportunity in Japan due to his Korean minority status.

The simple fact is some folks do not have the same job opportunity as others. In order to improve their own opportunity, they "create their own job". Aka, they started their own business.

KlangFool
"It is very simple.
If a person can get a job earning X in annual salary, there is very little incentive for the person to start a business earning X per year. The RISK and WORK does not justify the REWARD. Most people would not do it. The opportunity and reward has to be significantly greater than X."

Except for maybe these potentials when starting your own business....
- free time, flex time
- making more than XX over time
- ability to expand business
- not getting laid off
- choosing paths for yourself
- selling the business at the end
- choosing your own retirement tools
And a few others....
jayk238
Posts: 911
Joined: Tue Jan 31, 2017 12:02 pm

Re: Ways of successful entrepreneurs

Post by jayk238 »

KlangFool wrote: Sun Oct 17, 2021 10:06 am Folks,

It is very simple.

If a person can get a job earning X in annual salary, there is very little incentive for the person to start a business earning X per year. The RISK and WORK does not justify the REWARD. Most people would not do it. The opportunity and reward has to be significantly greater than X.

So, in general, entrepreneurs are those folks that faced discrimination, glass ceiling, limited job opportunity and so on. They cannot use the traditional career path in order to be successful.

https://en.wikipedia.org/wiki/Masayoshi_Son

Masa Son is a Korean Minority in Japan. He started SoftBank because he had limited job opportunity in Japan due to his Korean minority status.

The simple fact is some folks do not have the same job opportunity as others. In order to improve their own opportunity, they "create their own job". Aka, they started their own business.

KlangFool
This is about as reductive an argument as they get.

Just look at Mark Zuckerberg from Facebook. He had about as comfortable a life as possible with the likelihood of a guaranteed successful career in some professional life: Good upbringing, upper middle class family, good cultural values, Harvard Education. And then what? Drops out?

For every Google founder whose family escaped the Russian gulags theres another entrepreneur out there who took risks because they wanted to and became very driven and succesful - Elon Musk whose parents were in modeling and engineering and property development business!
User avatar
vitaflo
Posts: 1905
Joined: Sat Sep 03, 2011 3:02 pm

Re: Ways of successful entrepreneurs

Post by vitaflo »

KlangFool wrote: Sun Oct 17, 2021 9:21 am
vitaflo wrote: Sun Oct 17, 2021 9:08 am
KlangFool wrote: Sat Oct 16, 2021 8:27 pm
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
White Coat Investor,

I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.

KlangFool
Klang, you somewhat disagreed with my notion of luck, but being born into a business family is certainly luck! Plus it has built in networking.
vitaflo,

I know that you do not mean it. But, please explain to me how is this equal to luck?
Being born into a family of business owners gives you a leg up on anyone not born into a family of business owners, all things being equal. You don't get to choose who your family is. Nobody is saying hard work or trying to do better for oneself isn't important. It is likely the most important piece. But to say certain life situations that cannot be replicated have no influence either is being a bit disingenuous.
User avatar
Sandtrap
Posts: 19582
Joined: Sat Nov 26, 2016 5:32 pm
Location: Hawaii No Ka Oi - white sandy beaches, N. Arizona 1 mile high.

Re: Ways of successful entrepreneurs

Post by Sandtrap »

vk22 wrote: Sat Oct 16, 2021 11:24 am I have seen 2 types of entrepreneurs (1) Small business (2) Innovation driven. If successful, innovative companies can be more effective than small businesses. More than hustle, these require specific skills and paths people follow. For example, type of early work one does before becoming an entrepreneur. But no point comparing to unicorns like Facebook because they are so rare and not easy paths to replicate.

If you are an entrepreneur or seen successful entrepreneurships, what are some replicable paths?

I am giving a talk as volunteer to high schoolers in the next month on this topic. And personally, I am very curious about this topic too.

thanks
Curious:
First: if you are giving a talk to high schoolers about this, is it from the point of view of personally gaining substantial wealth by starting and owning a successful business that you own?

Per Your Questions:
Notes: (none from a book, seminar, or having sold at a swap meet, or made a web page).

1. Initial premise is not entirely correct. A small business entrepreneur must be innovative to survive, and. . .without "hussle" and "specific skills" will not last long either. This is not something that can be compartmentalized.

2. There are no "replicable paths" to substantial success and wealth as a sole proprietorship businessperson/owner. (this means not having a steady wage earning pension earning job and doing something on the side, etc.) But, having one's business feed a family, pay the rent, and put one in poverty if it fails. (walk the talk).

3. But, there are easily identifiable character traits to a successful business person as defined by: existing solely on the earnings of one's business, risking everything to do so including poverty with business failure and no safety net, and, importantly, prospering and accumulating wealth over time (not just treading water).
They are. . in metaphors:
a) The need for autonomy. IE: leader vs led, employer vs employee, individual vs institution.
*Autonomy is not an option, it's a must.
b) Leadership (huge). IE: Navy Seal vs seal vs otter vs sloth.
c) Courage and ambition to the point where most others think there's a mental problem. AKA: individuality and drive.
d) Ability to outwork and outperform others far beyond the 40 hour work week, 2 day off, 2 vacation/year, rubric, . . without burnout or stress. Usually thrives on stress where others weaken.
e) Vision (huge).
f) Redefinition of "work" as not something to pay the bills or to someday "retire from/leave asap". To many, even if not making money, their passion would be followed anyway. It's just pure fun.
g) Anti: lazy, sloth, excuse, justify, complain, ambivalence, quitting, etc.
h) Many very successful business people that have come from rags to riches, self made, have experienced poverty. So, they have a "context" of achievement that drives them and also adds, humility, empathy, and compassion, and knowing the value of a dollar hard earned.

The book, "Millionaire Next Door" (amazon/softcover) captures the above in some ways.

Examples:
1. Electrical Engineer, formerly salaried, had a vision for something done better as far as the electronics in a car. Goes into debt to open a company. Goes into debt several times. Eventually, sells the company to a major auto maker for a very substantial sum.
2. Young fellow out of public high school with a vision. Goes to welding school. Works for a muffler shop. Saves money. Opens his own muffler shop. In time, owns and runs 12 muffler shops across the city.
3. A young man immigrates to the USA. A survivor from the Vietnam post war "boat people" who were massacred trying to leave.
Works at a bakery and sleeps in a cot in back. Eventually, saves up and opens his own small bakery with recipes for breads from Vietnam (formerly a french province so gourmet cooking, etc influence). Runs his small bakery and distributes to all the fine dining restaurants in town, sleeps in back on a cot. Eventually expands to cover the entire state. No longer sleeps in back on a cot.
4. Etc.

Can one be "taught" to be a successful sole proprietorship business person/owner and go from a minimum wage job to substantial wealth on one's own?

I'm not sure.
But, I do know that it's not in a book, seminar, course, certification, number of degrees, level of education, or another fantastic idea that know one has thought of in itself, or. . . "I wanna. . . ".

PM me as you wish.
j :D
Last edited by Sandtrap on Sun Oct 17, 2021 10:54 am, edited 1 time in total.
Wiki Bogleheads Wiki: Everything You Need to Know
User avatar
Sandtrap
Posts: 19582
Joined: Sat Nov 26, 2016 5:32 pm
Location: Hawaii No Ka Oi - white sandy beaches, N. Arizona 1 mile high.

Re: Ways of successful entrepreneurs

Post by Sandtrap »

vitaflo wrote: Sun Oct 17, 2021 10:25 am
KlangFool wrote: Sun Oct 17, 2021 9:21 am
vitaflo wrote: Sun Oct 17, 2021 9:08 am
KlangFool wrote: Sat Oct 16, 2021 8:27 pm
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
White Coat Investor,

I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.

KlangFool
Klang, you somewhat disagreed with my notion of luck, but being born into a business family is certainly luck! Plus it has built in networking.
vitaflo,

I know that you do not mean it. But, please explain to me how is this equal to luck?
Being born into a family of business owners gives you a leg up on anyone not born into a family of business owners, all things being equal. You don't get to choose who your family is. Nobody is saying hard work or trying to do better for oneself isn't important. It is likely the most important piece. But to say certain life situations that cannot be replicated have no influence either is being a bit disingenuous.
+1
This is an excellent point.

Being born in a family business certainly is a huge huge leg up to form the character traits and all the "secret sauce" to create and succeed as a business person to the level of substantial wealth "on one's own" (vs inherited. . not the same).
Compared to being brought up in a family and extended family of wage earner pensioners, etc, who have mastered the education professional, insitutional, career path. (also outstanding).

That said, sometimes, there will be only one person in a family of 5 siblings that has both the interest and the ability to run a family business as an heir to fruition, at best. Thus, so many family businesses, majority, do not survive to the 3rd generation beyond. There's just no "secret sauce" found in the heirs, even though they might have spent a good portion of their lives in the business. It takes want and ability and "secret sauce". So, tough.

But, as you say correctly, the odds are higher growing up the a business family environment. Especially generational and having swept the factory floors as a kid, bagged potato chips as a teenager, drove the distribution trucks after high school, etc.

Great point
Thanks!
j :D
Wiki Bogleheads Wiki: Everything You Need to Know
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Ways of successful entrepreneurs

Post by KlangFool »

jayk238 wrote: Sun Oct 17, 2021 10:10 am
KlangFool wrote: Sun Oct 17, 2021 9:50 am
smitcat wrote: Sun Oct 17, 2021 9:27 am
KlangFool wrote: Sun Oct 17, 2021 9:21 am
vitaflo wrote: Sun Oct 17, 2021 9:08 am

Klang, you somewhat disagreed with my notion of luck, but being born into a business family is certainly luck! Plus it has built in networking.
vitaflo,

I know that you do not mean it. But, please explain to me how is this equal to luck?

A) I lost my father to lung cancer during childhood. My widowed mother had to run her small business and raised 6 kids on her own.

B) The male of my community had a life expectancy of 55 years. 1/3 of my elementary classmate lost their father due to sickness and poverty. So, (A) is very common.

C) As an oppressed minority, the MAJORITY use the power of the government to take away our education opportunity, our jobs, and our businesses.

D) My ancestor came from a region that had 800+ famines across 800+ years.

We were in business because we had to be resourceful in order to survive. By default, if we did nothing, we would not survive.

We are risk takers because we had to. We had no choice. The alternative is do not survive.

If you come across a community of risk takers, you would find that they are from a historically resource poor environment. They had to take risk in order to survive.

KlangFool
That is a very unfortuneate summary of your life experiences. And yet you are not at all a risk taker - quite the opposite.
Proving what?
smitcat,

1) What do you call a person that go to a foreign country after high school for their college education with little to no money? No scholarship. Compete with the locals for part-time jobs and earn their way through college.

By the way, I started a software company selling vertical market software while I was in college. But, I was not successful.

2) Go across the world a few times to find new employment and start a new life?

Not a risk taker?

I had taken enough RISK through my life.

3) I do not have a romantic view of RISK taking. I have a pragmatic view of RISK taking. I take RISK when the ROI is big enough.

KlangFool
With all due respect, your argument is largely based on self selected information.

you obviously have been through a lot but so have plenty of other immigrants.

The difference between why some immigrants are able to get a leg up and have a career or whatever is largely based on luck to some extent.

Just getting into college for example can be a result of some form of luck- family upbringing, cultural values etc.

Im not saying you had 100% luck. but there is a spectrum beween being born an orphan with HIV at birth with no social structure and no family support/values and someone born with a silver spoon. We are all on this spectrum. And if are, then you've been the beneficiary of some luck
jayk238,

I do not dispute the element of luck in success. I am just explaning why some group of people are more motivated to start their own businesses.

KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
User avatar
Sandtrap
Posts: 19582
Joined: Sat Nov 26, 2016 5:32 pm
Location: Hawaii No Ka Oi - white sandy beaches, N. Arizona 1 mile high.

Re: Ways of successful entrepreneurs

Post by Sandtrap »

HanSolo wrote: Sun Oct 17, 2021 5:05 am
KlangFool wrote: Sat Oct 16, 2021 8:27 pm
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. ...
I disagreed. I come from a multi-generation business family. 50% of my extended family is in one form of business or another. Family gathering tends to involve the latest business dealing that someone is involved in. If you are in this kind of family, you would be in business since you are born.
I think the "middle ground" between the above two positions is that entrepreneurship, as a mindset, can be learned, but learning by osmosis (growing up in a business family) gives one an incredible advantage over learning from a book or teacher; and, in any case, it can never be completely formulaic... you'll need to think of things that others haven't thought of and/or aren't willing to try... and those are the things you have to come up with on your own (i.e., can't be taught).

As for developing the mindset... Napoleon Hill interviewed various successful entrepreneurs to try to understand how they got there. He noticed certain commonalities, and documented them in his book, "Think and Grow Rich", with the intention of helping others find their way. Some have found this book to be informative and/or inspiring. I suspect that some may be better at applying the principles than others (according to aptitude, drive, and, as mentioned, childhood influences... maybe also genetic predisposition... just speculating here). It's just one book, but maybe worth a look.

By the way, there's also a program called Junior Achievement that exposes high schoolers to business principles in a "learn by doing" approach.
+1
Outstanding points.
Well said.
And. . . so so true!
On post target and on topic.

thanks!
j :D
(4rth generation!)
Wiki Bogleheads Wiki: Everything You Need to Know
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Ways of successful entrepreneurs

Post by KlangFool »

vitaflo wrote: Sun Oct 17, 2021 10:25 am
Being born into a family of business owners gives you a leg up on anyone not born into a family of business owners, all things being equal. You don't get to choose who your family is. Nobody is saying hard work or trying to do better for oneself isn't important. It is likely the most important piece. But to say certain life situations that cannot be replicated have no influence either is being a bit disingenuous.
vitaflo,

You missed my point.

1) WCI claimed than being entrepreneurs is not teachable.

2) I shown my example of a business family as an example of how it is proven to be teachable.

<<But to say certain life situations that cannot be replicated have no influence either is being a bit disingenuous.>.

3) I am trying to prove a point that it can be teachable and replicated. For example, someone could intern and/or work in a small business or to be mentored by an experienced entrepreneurs.

4) I am agreeing with you.

KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
User avatar
Sandtrap
Posts: 19582
Joined: Sat Nov 26, 2016 5:32 pm
Location: Hawaii No Ka Oi - white sandy beaches, N. Arizona 1 mile high.

Re: Ways of successful entrepreneurs

Post by Sandtrap »

White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion. Every path is different and only one person can go down each path.

I guess you could teach some generic basics like "make your runway as long as possible" and "begin with the end in mind" but putting together a list of specific, actionable steps? I'm skeptical.
+1
Great point.
Agreed.

Lot's of MD's in our family and extended relatives.
Some are self employed in private practice, or own speciality surgical clinics, etc, and do great, love the autonomy.
Some are institutionally employed (practice or teach), etc, also do great, love the "knowns".
Different paths per person.

j :D
Wiki Bogleheads Wiki: Everything You Need to Know
User avatar
Sandtrap
Posts: 19582
Joined: Sat Nov 26, 2016 5:32 pm
Location: Hawaii No Ka Oi - white sandy beaches, N. Arizona 1 mile high.

Re: Ways of successful entrepreneurs

Post by Sandtrap »

KlangFool wrote: Sun Oct 17, 2021 11:01 am
vitaflo wrote: Sun Oct 17, 2021 10:25 am
Being born into a family of business owners gives you a leg up on anyone not born into a family of business owners, all things being equal. You don't get to choose who your family is. Nobody is saying hard work or trying to do better for oneself isn't important. It is likely the most important piece. But to say certain life situations that cannot be replicated have no influence either is being a bit disingenuous.
vitaflo,

You missed my point.

1) WCI claimed than being entrepreneurs is not teachable.

2) I shown my example of a business family as an example of how it is proven to be teachable.

<<But to say certain life situations that cannot be replicated have no influence either is being a bit disingenuous.>.

3) I am trying to prove a point that it can be teachable and replicated. For example, someone could intern and/or work in a small business or to be mentored by an experienced entrepreneurs.

4) I am agreeing with you.

KlangFool
+1
Yes!
While not a guarantee, certainly a huge huge advantage and path.

Good points.
thanks!
j :D
Wiki Bogleheads Wiki: Everything You Need to Know
User avatar
celia
Posts: 16762
Joined: Sun Mar 09, 2008 6:32 am
Location: SoCal

Re: Ways of successful entrepreneurs

Post by celia »

vitaflo wrote: Sat Oct 16, 2021 7:31 pm Usually you need a good product, though not always. Who you know and who knows you (networking) is key and will help open doors that otherwise were not there.
I recall a former president who came from a business (real estate) world instead of politics who, as a teen, would meet new teens and always ask what their father did for a living. I see this as networking starting at a young age. Many would think this was strange for a teen, but I see this as looking for future resources. Possibly his father, also a businessman, taught him to do this.
vitaflo wrote: Sun Oct 17, 2021 9:08 am I understand the notion that "luck is when preparation meets opportunity", and while there is something to that, there is a lot in a successful business that is just lucky that nobody else can recreate. Certainly knowing how to take advantage of that is a skill in its own right, but I've had so many chance meetings, encounters, surprises, etc in my businesses that it would be very hard to "teach" that to someone starting out.
I took a seminar once that illustrated how to do networking. The instructor gave us an assignment after about half an hour in, to stand up and talk to others around us to see what kind of work they did. Although this was a 5 or 10 minute exercise to illustrate that resources are often near us, if you ask, he then explained the longer version of this exercise. When he teaches the full length version of this course and they are meeting in a tall builing with lots of businesses in it, he gives the course ‘students’ a half hour to go up the elevators (in various elevator cars, one ‘student’ per car) and they are supposed to start with introducing themselves with the goal of finding out who else is in the car. They are supposed to ask for business cards and bring them back to the seminar. When the seminar resumed, those who were successful read off the job titles of who they just met: marketing, legal, administrative, and CEOs were represented. These were examples of possible resources being next to you and now being aware of them.


Although not a business owner/entrepreneur myself, I also once picked up book in a bookstore and should have bought it, but didn’t. It was a book written for teens on something like How to Get Ahead in Life. The main premise was to find role models whom you would like to be like and figure out what they do that makes them different from the average person. For example, the person who wants to learn a new topic reads about it for 3 hours every night instead of watching 3 hours of TV. The person who wants to be more creative may learn new games or experiment in the arts. The point was for the teen to observe what their role models do that makes them who they are so they can take the same actions.

This is also where working for someone else for a few years comes in handy. Use it as a learning experience to see how typical businesses run— how they do payroll and pay taxes, how they treat customers or find new ones, how efficient (or not) they are. Volunteer to do things outside of your job description. Use it as a learning experience to see what they do well and where they need improvement (in your mind). Learn from their ‘mistakes/inefficiencies’ on their dime, instead of learning everything at your own expense.
hotscot
Posts: 430
Joined: Wed Feb 01, 2012 10:05 am

Re: Ways of successful entrepreneurs

Post by hotscot »

Find an unserved niche.
Then serve it.

My niche is selling high precision scientific instruments manufactured in Germany.
I sell to the US Gov...when they can afford them. 50 sales a year. 90 mins a day.
I do not advertise/market...they call me.
User avatar
Sandtrap
Posts: 19582
Joined: Sat Nov 26, 2016 5:32 pm
Location: Hawaii No Ka Oi - white sandy beaches, N. Arizona 1 mile high.

Re: Ways of successful entrepreneurs

Post by Sandtrap »

moneyflowin wrote: Sat Oct 16, 2021 8:50 pm Entrepreneurs are risk takers; small business owners may or may not be.

My father has owned small businesses. He didn't like risk. He's the type to buy things with cash instead of credit cards. He just wanted the business to produce income for a comfortable retirement. He was not out to revolutionize anything or change the world.

Entrepreneurs have a different mindset. Let me ask you, if you had $160M, would you retire? Or would you use it invest in new, high-risk businesses? And when that business nearly fails, you put more money into it? I bet 90% of the population would retire. Elon Musk made $160M from selling Paypal and used it to create SpaceX and effectively buy Tesla, a couple of massive gambles. Tesla nearly went bankrupt and he had to put more money into it save the company.

That's clearly a different mindset than the average small business owner.
Great points!
Well said!

I didn't know that about Elon Musk.
Thanks!
j :D
Wiki Bogleheads Wiki: Everything You Need to Know
User avatar
Sandtrap
Posts: 19582
Joined: Sat Nov 26, 2016 5:32 pm
Location: Hawaii No Ka Oi - white sandy beaches, N. Arizona 1 mile high.

Re: Ways of successful entrepreneurs

Post by Sandtrap »

It's good to remember that it was entrepreneurial business spirit and drive that put "Diehards" at Morningstar, then. . "Bogleheads" (this forum) on the map.
To evolve to be anti business or entrepreneurial without understanding that the forum "wiki" investment finance principles apply across the board to the business and finance world would be myopic to some.

This forum continues to thrive and grow, because of this spirit, as perhaps, its founders, would attest to.
Hurray!!! :D :D
j :D
Wiki Bogleheads Wiki: Everything You Need to Know
User avatar
nss20
Posts: 57
Joined: Wed Jan 01, 2020 12:36 pm

Re: Ways of successful entrepreneurs

Post by nss20 »

White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion.
Sorry to disagree with so many of the respected opinions here. It is both reproducible and teachable. However, not everyone will be happy being an entrepreneur nor will they necessarily be better off financially.

Based on the discussion here, I would distinguish between "product" and "service" entrepreneurship. Everybody who puts up a "shingle" be it a doctor, an accountant, a car dealer, or a barber is an entrepreneur. They do have different levels of risk. Entrepreneurs who make new products have two major additional hurdles which are different from those who offer services:

1. Having the cash flow to survive the creation of a viable product. (Almost always, it takes longer than you think).
2. Building a product that enough people will pay for. (What you think people will pay for is often a lot different from reality).

Getting into services is a great way to learn about customer needs and in imagining a product that people will pay for. It also affords an opportunity to experiment with prototypes while continuing to sell services to support the building of products. By the time (professional) investors come along, you need to demonstrate some market success (the shark tank is a good example of how VCs think).

There are always outliers but the basic model of entrepreneurship is straight forward. It's not for everyone because not every personality is suitable for doing it. However, that doesn't mean that there is any great mystery behind it.
User avatar
Sandtrap
Posts: 19582
Joined: Sat Nov 26, 2016 5:32 pm
Location: Hawaii No Ka Oi - white sandy beaches, N. Arizona 1 mile high.

Re: Ways of successful entrepreneurs

Post by Sandtrap »

nss20 wrote: Mon Oct 18, 2021 6:13 am
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion.
Sorry to disagree with so many of the respected opinions here. It is both reproducible and teachable. However, not everyone will be happy being an entrepreneur nor will they necessarily be better off financially.

Based on the discussion here, I would distinguish between "product" and "service" entrepreneurship. Everybody who puts up a "shingle" be it a doctor, an accountant, a car dealer, or a barber is an entrepreneur. They do have different levels of risk. Entrepreneurs who make new products have two major additional hurdles which are different from those who offer services:

1. Having the cash flow to survive the creation of a viable product. (Almost always, it takes longer than you think).
2. Building a product that enough people will pay for. (What you think people will pay for is often a lot different from reality).

Getting into services is a great way to learn about customer needs and in imagining a product that people will pay for. It also affords an opportunity to experiment with prototypes while continuing to sell services to support the building of products. By the time (professional) investors come along, you need to demonstrate some market success (the shark tank is a good example of how VCs think).

There are always outliers but the basic model of entrepreneurship is straight forward. It's not for everyone because not every personality is suitable for doing it. However, that doesn't mean that there is any great mystery behind it.
Good points.
Well said.

Agreed.
There are no great mysteries behind being a businessman and/or entrepreneur. . . just as there are no great mysteries behind what it takes to be a Navy Seal, or Bezos, or Musk, or Onassis, etc. But, as you say, it's not always a good fit.
Everyone had different comfort zones and needs and abilities.
The "wash out" rate can be severe. :shock:

Perhaps some similar reasons why not all investors are "bogleheads". . . and follow the forum "wiki". :D

j :D
Wiki Bogleheads Wiki: Everything You Need to Know
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Ways of successful entrepreneurs

Post by KlangFool »

OP,

There is another path.

1) Work for the megacorp as a product manager -> Director of Marketing -> GM/VP. Aka, corporate ladder.

2) Use the network to partner with someone to start a company. This is based the industry knowledge of customer, product/service, and supplier

3) Use other people's money to fund the start up.

4) Exit by selling the company.

My older brother started 3 companies and sold 2 based on this approach. Some megacorp has a venture capital subsidiary. They use that to fund promising start-up. This includes those started by their former employees.

KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
User avatar
White Coat Investor
Posts: 17338
Joined: Fri Mar 02, 2007 8:11 pm
Location: Greatest Snow On Earth

Re: Ways of successful entrepreneurs

Post by White Coat Investor »

nss20 wrote: Mon Oct 18, 2021 6:13 am
White Coat Investor wrote: Sat Oct 16, 2021 11:34 am Entrepreneurship by its very definition is neither reproducible nor teachable in my opinion.
Sorry to disagree with so many of the respected opinions here. It is both reproducible and teachable. However, not everyone will be happy being an entrepreneur nor will they necessarily be better off financially.

Based on the discussion here, I would distinguish between "product" and "service" entrepreneurship. Everybody who puts up a "shingle" be it a doctor, an accountant, a car dealer, or a barber is an entrepreneur. They do have different levels of risk. Entrepreneurs who make new products have two major additional hurdles which are different from those who offer services:

1. Having the cash flow to survive the creation of a viable product. (Almost always, it takes longer than you think).
2. Building a product that enough people will pay for. (What you think people will pay for is often a lot different from reality).

Getting into services is a great way to learn about customer needs and in imagining a product that people will pay for. It also affords an opportunity to experiment with prototypes while continuing to sell services to support the building of products. By the time (professional) investors come along, you need to demonstrate some market success (the shark tank is a good example of how VCs think).

There are always outliers but the basic model of entrepreneurship is straight forward. It's not for everyone because not every personality is suitable for doing it. However, that doesn't mean that there is any great mystery behind it.
I guess maybe I should distinguish between two different kinds of pathways.

Opening a business offering a product or service that has already been invented such as medicine is one pathway. I agree that's very teachable and reproducible.

Developing a new product or service or fusion or two different fields or whatever. Something new that has never been done before. Not teachable. Not reproducible other than generic "here's how to run a business" advice.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course
Topic Author
vk22
Posts: 133
Joined: Wed Jun 17, 2015 10:40 pm

Re: Ways of successful entrepreneurs

Post by vk22 »

Great insights so far!

1) can be taught vs. cannot be
2) Start with a services business then develop to products
3) Family connections help
4) Failure is a good lesson
5) mindset is important
6) Rise the corporate ladder and then leverage for entrepreneurship
+ more..

FYI. 6 myths of entrepreneurship from a MIT Professor
https://www.youtube.com/watch?v=_zWgGX71Iws
Yellowjacket1
Posts: 72
Joined: Sat Jul 28, 2018 2:54 pm

Re: Ways of successful entrepreneurs

Post by Yellowjacket1 »

Thanks all for the good advice, resources, opinions. I am mentoring a young man who wants to help minorities to become entrepreneurs. Your posts will help me to help him. If you have any other info please PM me.
User avatar
Sandtrap
Posts: 19582
Joined: Sat Nov 26, 2016 5:32 pm
Location: Hawaii No Ka Oi - white sandy beaches, N. Arizona 1 mile high.

Re: Ways of successful entrepreneurs

Post by Sandtrap »

Yellowjacket1 wrote: Mon Oct 18, 2021 2:04 pm Thanks all for the good advice, resources, opinions. I am mentoring a young man who wants to help minorities to become entrepreneurs. Your posts will help me to help him. If you have any other info please PM me.
Are you an entrepreneur?
Wiki Bogleheads Wiki: Everything You Need to Know
DoubleComma
Posts: 2035
Joined: Sun Aug 23, 2020 2:23 pm

Re: Ways of successful entrepreneurs

Post by DoubleComma »

Not sure where these students live; in a city, rural or suburb. My experience has been, in additional to ones family environment, the type of area you grow up in has a lot do with if they become an entrepreneur vs an employee.

I have found, acedotally of course, those who are raised more rural are more likely to start their own business as a matter of necessity. If you grow up in a major metro, or suburban area tied to one, there tends to be a lot more opportunity to get a job and develop a career. Those who grow up rurally don't have the same opportunity sitting right there in front of them.

I grew up rural, I left for college and developed a successful career that allows me to live anywhere so I returned to a rural community. Its what I know and love, but between college and the start of my career I lived in a couple major metropolitan areas for 15 years. This dicotimy has allowed me to see a difference in paths frequently followed. It doesn't say one will or will not follow that path, it just says odds are you will.

I find this especially true in agrarian communities. Only so much land is available and its pretty capital intensive to start a farm, ranch, dairy, etc. However as the world has become specialized and efficiency is a major component to profitability you see individuals starting businesses catering to things that were once vertically integrated into the farm. Maybe they buy a combine and contract harvesting, maybe they become a mobile mechanic and take jobs that once were done in house, maybe they start a trucking business and move commodities or set up a grain yard and store/broker products. There seems to be a lot more self-employment in rural areas and therefore I think where you live has as much to do with it as anything else.

I don't have much to regret in life, but I do wish I was self-employed. In my particular situation I found success right away that made the risk and opportunity cost much higher. Not something I recognized at 23, 24, 25, but by the time I was 25 I was constantly earning 6-figures as new college recruits were being paid ~ $30k.

I would definitely talk about opportunity cost with these students. Make sure they know their own choice increase or decrease opportunity cost dramatically
Post Reply