Ready to Be an Entrepreneur? Then You Must Be Willing to Embrace Risk

Tom Panaggio

June 14, 2018

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It's the most frightening leap of faith one might undertake�"quitting a paying job to start a business. It's like the parachuting joke, "Why would anyone jump out of a perfectly good airplane?" But an entrepreneur, at their deepest core, has a burning desire to follow a dream of creating a business success story and therefore is willing to take the risk. In spite of the incredible odds against succeeding, each and every day people leave the security of a well-paying job, take the leap, and are now happy and successful business owners.

Over 30 years ago, I took the leap of faith and picked up everything I owned and moved to Florida to start a business with my brother and sister. I am happy to report that we beat the odds. Not only did we create a successful company, one that completely dominated our unique market space, but we have enriched the lives of hundreds of individuals who took the journey with us. In the end, our exit paid us handsomely. We achieved the American Dream by embracing risk.

All it Takes is a Never-Ending Willingness to Embrace Risk

What's the secret to entrepreneurial success? What I discovered was risk and opportunity were eternally connected and, in fact, soul mates. Every opportunity came with risk, and the only way to keep my business moving forward, to meet the competitive challenge of a brutal marketplace, was to keep pursuing more opportunities. Thus, the risk was essential for success.

However, human nature prevents us from fully accepting the idea that risk is a positive force to embrace. Risk is seen as a negative consequence of a decision made, so our natural tendency is to avoid those decisions where uncertainty is present. Avoid risk and therefore avoid failure, thus we have achieved a zero-sum advantage—no cost for avoiding risk.

By avoiding risk, we are living in a false reality. The temporary comfort we gain from rationalizing our inaction does nothing but postpone the inevitable. Hoping that something will change to improve your situation will result in defeat, the end of your dream. Success only comes via constant forward progress, which requires making something happen. As a leader, your example of enthusiastically seeking an opportunity to execute, improve, and deliver results will be the beacon that guides all who follow you. Therefore, you cannot allow yourself to be trapped by hope and the artificial security that risk avoidance creates. Ask people who have stood in the open doorway of an airplane five thousand feet above the earth and jumped. They will tell you it was frightening but once they leaped it was an amazing experience and they can't wait to do it again.

Eliminate the Greatest Impediment for Success—Fear of Losing

The reality is that risk avoidance is the greatest impediment to progress, personally and professionally. We have been conditioned for self-preservation, and as a result, we can easily justify the mitigation of risk with well-worn excuses, such as "I didn't want to lose." Yet this is hardly a zero-sum game. Avoiding risk means passing on opportunity and that is costly.

Opportunity, like time, is perishable. Miss an opportunity to take the entrepreneurial leap of faith because you just don't want to "risk it" or your perception is "the timing is not right", and circumstances could disrupt your dream forever. The very thing you were afraid of—the risk of losing—has become a self-fulfilled prophecy, you have lost your dream to create a new business and flourish because you couldn't muster the courage to leap. You were waiting for ideal conditions.

The Trap of Ideal Conditions

As you read this, in every community across the entire country sits a business plan hidden away in a box or on a hard drive. The author of this well-thought-out plan is waiting for the right conditions: funding, free time, better economic conditions. To the risk-averse entrepreneur, the dream of beginning her own business will be a perpetual desire that will remain unfulfilled and collecting dust in the attic because they are trapped waiting for ideal conditions.

Our business started during some of the worst economic conditions in American history: the early 1980s. Interest rates were sky-high, as was unemployment and inflation. The overall mood for business opportunities was terrible. Yet, our desire to create a successful business was so powerful that we never gave these issues a thought. Tough times were not going to extinguish the burning desire to move forward.

No matter how difficult conditions may seem, a well-prepared entrepreneur can succeed. Those who believe that success can be attained through their guile or instincts are playing a fool's game. Even the concept of embracing risk does not mean being unprepared and shooting from the hip. Great accomplishments do not happen by chance or through the result of random activities. They happen because there was a plan and all parties committed to its execution. In other words, they were prepared.

Have a Simple Plan and be Ready to Execute

The only requirements of a good business plan are that it is clear in its direction and it has simple objectives. A successful entrepreneur does not wing it: an entrepreneur who wants to win has an attack plan—a strategy that puts her into a position to succeed. If you don't know where you are going, then how will you know when you get there? Few things in the business world have a positive result without a general plan. A plan helps to keep you on track, and it provides a roadmap so everyone knows what the goals are and how well you are progressing.

However, execution is what transforms a plan into a reality. If your weakness is in executing your plan, then you are headed for defeat. Great planning is meaningless if your execution is poor. Each and every day you must make the commitment to "make something happen" and keep your business moving forward. The marketplace is far too competitive, and those who fail to execute day after day will, sadly, fade away and become another casualty.

As you sit and contemplate the virtue of entrepreneurship and mentally debate the merits of taking the leap of faith, I want to leave you with this personal insight; I lived my dream, and the hardships, frustration, and disappointment that I experienced during the journey are washed away by the satisfaction of success. I am content. Looking back, I see how my repeated willingness to embrace risk was what gave me the edge and made our company an industry leader. I invite you to enthusiastically employ risk in pursuing your own dreams. You may find it's your greatest asset.

Tom Panaggio has enjoyed a 30-year entrepreneurial career as co-founder of two successful, direct marketing companies—Direct Mail Express and Response Mail Express. He is the author of The Risk Advantage: Embracing the Entrepreneur's Unexpected Edge.

Opinions expressed by the author are not necessarily those of WITI.

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