Blog Week 2: Chapter 1 – The Role of Risk-taking in Entrepreneurial Success
There is always risk involved in being an entrepreneur, even if it is successful there is always a chance that things could change, where people don’t need or want your product or service anymore. In It’s a Jungle in There, he tries to keep his steady job while creating his own business. Which is what most people would do to keep the safety net under them as long as possible. But as fate would have it, neither worked out. It took him losing everything to figure out what to do. Which also shows that failure can lead to success. His failure of his first entrepreneurial business led him to a successful business idea by combining his idea with another and partnering with someone else that already had a business up and running.
Risks are essential to an entrepreneurial business, you can’t be an entrepreneur without risk. In the article 7 Risks Every Entrepreneur Must Take, Jayson Demers says “Risk-taking is almost synonymous with entrepreneurship. To start and support your own business, you’ll have to put your career, personal finances and even your mental health at stake.” In this article Jayson reveals the top 7 risks as:
- Abandoning the steady paycheck
- Sacrificing personal capital
- Relying on cash flow
- Estimating popular interest
- Trusting a key employee
- Betting on a crucial deadline
- Donating personal time (and health)
In the article 5 Things Every Entrepreneur Should Know about Risk-Taking, Larry Alton explains that there are different types of risks. One being calculated risks “which involve a series of knowns that allow you to reasonably predict the odds of success.” There are ambiguous risks which most companies have to deal with which do not have to ability to predict success as well due to many factors such as consumer behavior and economic shifts. Unknown risks are brought on when you bring something unique to the market. It is good to know what type of risks you are dealing with in your business.
People tend to be have unrealistic probability of failure. Also if failure does come to them it tends to turn out not as bad as they thought it would. People seem to think that it will be the end of the world, when usually some good will come of it. Risk is scary but you can’t let it paralyze you from moving forward, that is what stops everyone else. Larry also states that even if you fail at your risk-taking, you still took a risk which will make you stand out from the crowd of non-risk-takers. Showing again that failure can lead to success. You just have to know that there may be consequences to your risk taking but that they can be handled, and that like in It’s a Jungle in There “if it’s not worth the risk, it’s probably not worth the reward.”
Schussler, Steven and Karlins, Marvin. It’s A Jungle in There. New York: Sterling, 2010. Print.
Demers, Jayson (2014, October 13). 7 Risks Every Entrepreneur Must Take. https://www.entrepreneur.com/article/238319
Alton, Larry (2016, February 3). 5 Things Every Entrepreneur Must Know about Risk-taking. https://www.entrepreneur.com/article/270320