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What makes a successful entrepreneur?

This is how most employees see their income - a gradual accumulation of their savings over time.

The employee lives from paycheck to paycheck with the constant fear of retrenchment as he progresses up the corporate ladder. He is concerned only with his salary, the amount of increment at the end of the year, the size of his bonus and the number of leave days.

On the other hand, this is how an entrepreneur sees the business:

He is not only acutely aware of the cost structure, but also motivated to be as creative and innovative as possible so as to maximise his profits. He is driven that way because with the right ingredients at the right time, there is a chance that he might be able to achieve outsized returns on his investment.


Four years into trudging and bruising, I retraced my steps and got myself thinking about what makes an entrepreneur, a business owner, a founder, and what drives them to do the stuff they do.

Most people go into a new venture for the money. Some do it for the publicity. Media does a successful job of dramatizing those who start a business or raise their own fund. In fact, to me, it should always be about the money. I'm not being a mercenary, it's just more commercial. Unless you are operating a charity or social enterprise, starting a new business should always be about maximizing profits. Companies are sometimes willing to provide incentives and discounts to key customers or early takers at the expense of profits. This is fully understandable. That discount is an intangible marketing and relationship building cost, and the company expects that goodwill to pay off sometime in the future.

There is also a lot of fun in building a business. But beyond the fun and the congratulatory notes from supportive friends, I sometimes wonder if people really know what they are getting into?


Most people are oblivious.

I caught up with a friend recently and shared with him what I'd been up to the last few weeks and months. Despite all the gloom around travel restrictions and crimping of dealflow, etc, I was sanguine and I got him enthusiastic about what we've been doing, the multiple platforms we have, the result of our hard work over the years, translating to tangible and "pursue-able" opportunities. He'd loved to be part of the "action".

I really don't think people really appreciate or know, first-hand, the pain and struggles experienced by being a business owner.

The pain of having to put up cash for operating overheads, do payrolls, pay for expenses, source for new revenue, execute, and yet, all at the same time, not having to draw a salary for yourself.

So many choose to see only the rosy side.

And because they see only what they want to see, they tend to be ignorant of what it really takes to operate a business and crystallize those nice sounding opportunities.

I am not trying to be a wet blanket. Neither am I belittling our achievements over the past 4 years, nor am I trying to discourage people from pursuing a dream of starting up.

But the struggles undertaken by someone on the path of entrepreneurship simply cannot be adequately described through conversations, the sharing of anecdotes in webinars, or inspiring commencement speeches and classroom workshops.

Some want to be heroes.

Some years back, I had closed a huge cross border M&A deal. Because of its size and complexity, it drew the attention of senior management, and as a result, I got an accelerated promotion (I think).

More than just the vote of confidence at the workplace, the project gave me the breadth to exercise a great deal of autonomy throughout the negotiation process. Although being relatively 'junior' at that point in time, I was effectively thrown into the deep end of the pool to learn on the job.

I ran negotiations with various stakeholders in the project, piloted the financial model between two contesting bidders and coordinated the work streams between the stakeholders and lawyers. It wasn't a perfect process: I mucked up some of the translation at some of the meetings between the parties, ran into impasses at negotiations where I felt helpless, and broke some parts of the financial model.

Bankers who work on similar multi-million M&A and IPO deals often wear these similar deal creds like a badge of honour when they speak to their peers or at interviews. A lot unfortunately become arrogant and get carried away by the disillusionment that they are highly sought after professionals just simply because they were on the deal team. I loosely coin this as the 'hero mentality'.

It is this misplaced sense of glory and pride that makes bankers arrogant. The hero mentality also leads many disgruntled employees from large organizations into starting their own business, who would then realize after falling flat on their faces and that once you jettison the big bank brand off your shoulders, it is not that easy after all.

When you are running a deal in a large institution, your clients see you as an equivalent of the company you represent and are therefore willing to do business with you. You are an endorsement of your company i.e. you are nothing without the enterprise. Don't give yourself more credit beyond that.

When you are operating your own firm, clients work with you choose you because of who you are personally. You are the brand of your own business. You have a significantly smaller reach and network and no one in the market knows you unless you have a personal relationship with them. The strength and extent of these networks are often smaller and weaker than what you think they are.

Assembling an M&A deal takes more than just execution.

Beyond financial models and info memos, there are "hidden" work streams involving years of investing into relationships. Most clients will not deal with directly with you or pay you at a commensurate level working for a large financial institution. For them, the credibility and the branding of engaging with an internationally recognised firm is what they paid for.

So if you think that you did a lot of work in executing that M&A deal and deserve more credit than the organization employing you, think again - you probably would not be able to pull it off without leveraging on the global network and brand that is on your name card.

"Leveraging the shoulders of giants"

Adding it all up, it sometimes looks like the net result between being an employee and starting a new business, making profits and then eventually selling it for a buttload of cash - could ultimately be the same.

Perhaps one key difference there is that: While you can certainly live as an employee with a somewhat visible income stream, there is no guarantee you can exit your business profitably as an entrepreneur. That being said, the life skills you acquire from being a business owner remains starkly different from an employee.

How does one define success in entrepreneurship? Can someone be considered a successful entrepreneur even when you are flat broke? Is the goal always to achieve a billion dollar valuation on your business? Is size the definitive metric for measuring entrepreneurial success?


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