Entrepreneurship is sexy (at least it's portrayed that way in the media) and has many benefits. But for the wrong person, the "American Dream" can quickly become a nightmare.
Here are a few of the big, neon, flashing signs that say that you probably shouldn't be an entrepreneur — at least today.
You're an elf.
Elves take direction from Santa as a visionary. While elves make great employees, they make horrible entrepreneurs.
I had one particular friend that desperately wanted to start a business. I was baffled because in her previous jobs she had always complained when there was a lack of direction. When she was told what to do, this woman was a superstar. However, if you didn't tell her what to do, then she did virtually nothing. She didn't have the innate drive to "pick up the ball and run with it" unless someone specifically told her to do so.
Basically, you can't run a business when you are waiting for directions. There is no goddess of entrepreneurism that will appear in a vision and give you guidance and suggested next steps. Not only is it up to you as an entrepreneur to set the direction, strategy and work process for yourself, but you need to do that for every person in your organization.
If you are an elf, not only will this task be daunting, it will be nearly impossible. Instead, consider taking your entrepreneurial spirit and putting it toward your work in someone else's organization.
You live for perfection.
The enemy of progress is perfection, especially for entrepreneurs. Perfectionists are never able to substantially grow their business, because they do everything better than everyone else (at least in their minds) and are never able to delegate effectively enough to gain scale.
They also have a hard time getting products and services to market because instead of pursuing minimum viable products/services (i.e., a product/service good enough to please the customer), they want everything to be, well, perfect.
Perfectionists also fear failure. Being willing and able to fail correctly (that is, quickly, cheaply and never the same way twice) is part of the critical risk-taking and pivoting process that allows entrepreneurs to excel.
Money isn't your friend.
People's habits and relationship with money tell a lot about whether they will be a good entrepreneur. If you are too conservative with your finances, you will not be able to make the investments and make the educated risks required to grow your business. I like to call this "el cheapo" syndrome and know many who suffer from it.
On the opposite side of the spectrum, being careless with money is also an entrepreneur-killer. If you don't know the difference between "spending" and "investing" (or don't do the latter well), you are likely going to carry that habit into business with you and end up lighting a bunch of money on fire with nothing to show.
Finally, not having enough money can be a huge issue. This one is more of a timing issue, so you can overcome it. But if you don't have enough money to open your business, fund it for three years while it gets legs underneath it and live on — and you don't have or can't find sources to help you get that capital — you are going to make poor choices. The choice to pay rent or invest in your business is never a good choice to have to make.
You're delusional (at least about entrepreneurship).
If you are more enamored with the fantasy of entrepreneurship than with actually running a small business, you could be one of those many entrepreneurs who find themselves working longer hours for the same or less pay — with more stress than they did when they had a job.
Or maybe you find that you wanted to be your own boss, but really the needs of everyone else — from your customers, to your employees, to your landlord and/or vendors — have to come before yours, and you aren't the boss you expected.
Starting a business is fun, but running it and doing the basic business "blocking and tackling" every single day is what makes it successful (not the "great idea"). Much in the way that planning a wedding is fun, but it's not a good precursor to a successful marriage — working on it every day is what makes it work.
Take time to educate yourself. I once sent a financial services executive who wanted to open a restaurant, but knew nothing of the industry, to work in one. That lasted all of two weeks before she decided that the industry left a bad taste in her mouth, so to speak.
Businesses succeed when an entrepreneur finds a problem that needs to be solved, they are the "right" person to solve it and it's the right time for them to do so. Any missing component may make you one of those majority failure statistics.
Carol Roth is a "recovering" investment banker, entrepreneur, investor, speaker, small-business advocate and author of The New York Times bestselling book "The Entrepreneur Equation."
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