“Where are you on the spectrum?
This could be a question that could spark all kinds of emotive reactions, particularly if the recipient sits in a space of feeling a stigma and block towards talking about anyone or anything that sits outside generalised “norms”. To cut to it, the idea of being “on the spectrum” can be labelled in a negative way towards those with any form of autism, yet another form of “othering” in society.
“Where are you on the spectrum?
Today I ask this provocative question first for us to be aware of our biases (for more on bias and heuristics. see earlier posts here, here and here).
From that awareness around bias towards labelling and “othering, I ask you to then recognise that we often think in binary ways along a myriad of topics, using heuristics (mental shortcuts which inherently contain degrees of bias) to decide that we are either one thing or another, rather than being “somewhere on the spectrum”, not at one end or the other.
The specific topic I’ve chosen to use to examine this today is: “are you entrepreneurial or not?”, answering that binary question with ideas to bring awareness that we all sit somewhere on a spectrum around entrepreneurial mindset, none of us are either entrepreneurial or not.
Are you entrepreneurial or not?
This question seems to often be answered with a binary “yes” or “no”, whereas when one looks more deeply into it, we are all somewhere on the spectrum towards being entrepreneurial.
What does it mean to be entrepreneurial?
In “How do you know if you could be an Entrepreneur?“, I wrote:
So many people have talked to me over the years wondering whether or not they can / could / should / will make the leap to leaving their job to start their own business. Being an entrepreneur and working with entrepreneurs, when I ask people why they started their business, the answer always contains something like : “I couldn’t NOT do it”
A real entrepreneur has no choice. Sure, entrepreneurs are often inspired by seeing a gap and taking that opening (which is also a rough translation of the French roots of the word). They often see a market gap where they can make money. Taking entrepreneurialism beyond ventures that are wholly or exclusively focussed on profit, one can see an opportunity to make an impact socially, politically and more.
Also, entrepreneurs have a higher “risk profile”, a higher tolerance for risk than other people. As my inspiring friend Maeve Gillies told me “I have often said “Leap and the net will appear”, though the net doesn’t always look like a net”.
Read this and you will readily note that, though I have gone some way to defining what it means to be entrepreneurial, I too have presented being entrepreneurial as a binary “you are, or you are not”, I did not discuss being “somewhere of the spectrum of being entrepreneurial”.
There are numerous dimensions of being entrepreneurial (for more on dimensions and “sliders”, read: “Learning from The Beatles – “Mixing” your Leadership“.
For today, let us narrow down on one such dimension, attitude to risk.
Where are you on the risk spectrum?
I’ve often used this image, yet again it shows an extreme of tolerance for both risk and uncertainty.
Let us now consider the spectrum of attitudes and behaviours around risk as it relates to being entrepreneurial. First, another link for your reading, around the difference between risk and uncertainty, a post called: “Business is simple, people are complex“, curating an article by Mike Driver. In short, risk and uncertainty are very different, yet entrepreneurs must be comfortable to a higher degree than the general population with both.
Now, back to risk.
How entrepreneurial am I in terms of risk?
Using myself as an example, I am indeed entrepreneurial, but, as one might expect from someone who followed a conventional path through to being a Chartered Accountant to begin his career, I would never “jump off a cliff and build a plane on the way down”, though I am very comfortable leaping without knowing what the net will look like.
Using the area of financial risk, often those who are considering leaping away from secure employment to an entrepreneurial “at-risk” venture may assume that all entrepreneurs are living a “high wire” act with tremendous amounts of risk.
Not me.
Yes, looking purely at the financial side (there are many other benefits of being an entrepreneur!), it could be perceived that I am at higher risk as an entrepreneur than if I were in a salaried role, yet at the same time an investment truism (risk: return) is that this can also open me up to higher potential returns.
I like to manage and reduce risks while still earning higher than average returns, so my way of being an entrepreneur includes ensuring that I am never at what I perceive to be a real financial risk. I always have a financial platform, including such elements as:
- Capital. Liquid, secure capital behind me as a cushion at a level above what those in “secure employment” earning similar levels would typically have.
- Knowledge. High level of education and resources around financial planning, both short term (yes, I am a recovering accountant, I almost obsessively balance my bank statement and other accounts at least every two weeks). So, knowledge is both educational and also situational, I always know where I stand, no mysteries, plus what investment choices I can make and what the risk implications are.
- Behaviour. Many are fearful around money such that anytime there is any uncertainty around their income or capital their perception of risk becomes greatly increased, leading them to be far less entrepreneurial as they then have an extremely low tolerance for financial risk. Simply put, I don’t have those fears, both for the reasons given and also that I have invested energy and time into understanding psychology around money from experts and applied to myself (as well as supporting my clients and others).
- Income. I spread my portfolio of where I earn my money across multiple clients of different types, sizes, geographies. I also have income streams from more than one area of business, as well as personal income from outside my business derived from investments over many years. I am not ever overly dependent on any one source of income.
Summarising all of that, I focus on strategy, planning and focus on Capital, Income, Knowledge and Behaviour so that I can ensure I achieve the returns possible as an entrepreneur while greatly mitigating the risks.
We are all somewhere on the spectrum
In closing, my thanks today to a friend in a circle of friends very important to me. They were sharing recently an opportunity in front of them of an extremely “high wire” entrepreneurial opportunity that would be there first true move away from the relative safety and security of corporate employment. They asked for my take “as an entrepreneur”. I realised that the leap they were considering was absolutely vast and that it was of value to share with them that, after all, “we are all somewhere on the spectrum”.