People often ask “are entrepreneurs born or are they made?”
At the Raymond Ackerman Academy of Entrepreneurial Development we’ve seen that some entrepreneurs are born but people can also be taught to be entrepreneurial, if they have the right attitude and lots of determination.
Here are some tips on how to get started on your entrepreneurial journey.
1. Know what it takes to be an entrepreneur:
One of my favourite entrepreneurial sayings is “Entrepreneurship is living a few years of your life like most people won't, so that you can spend the rest of your life like most people can't."
To be an entrepreneur takes determination, creativity, perseverance, resourcefulness, tenacity, integrity and innovation. Most importantly, you must have the ability to take calculated risks and to get up again when you fail (because you will). If you think you have these characteristics you are half way there.
2. Start small:
People always say that they can’t start their own business because they have no money or can’t access funding. Nonsense!
If you sell enough packets of peanuts you can make enough money to buy muffins and if you sell enough muffins you can make enough money to buy calculators etc. Start small, make some money and then invest that money into something bigger. One day when you’ve grown your business to be eligible for funding, potential funders will respect that you got to where you are on your own.
They say the business that you want isn’t the business you start first. It takes hard work and resourcefulness.
3. Innovative ideas are key:
Not everyone can be the next Raymond Ackerman, Patrice Motsepe or Richard Maponya. South Africa needs entrepreneurs who build small businesses that support communities and create jobs, by providing products or services that solve a problem or add value.
Carwashes, hair salons and internet cafes are respectable businesses but there are only so many an economy can support. Think about how a product or service can fill a gap or add value to a customer in a way that doesn’t already exist.
Read your newspapers, they are full of problems that could be turned into potential business ideas – people pay for solutions to daily problems.
4. Network, network, network!
Entrepreneurs don’t wait for people to come to them – they network (and that doesn’t mean they hand out business cards to everyone they meet).
Never underestimate the power of networks and who you know. Make a list of all the people in your immediate social, work or business circles and then a list of all the people they know – you’ll start to see how extensive your networks are.
Business happens through people you know and who can trust you. Start there.
Reputation is also key – make sure you are always professional and never burn bridges; you never know when you’ll come across those people again.
5. Know how to manage money
Start with your personal finances, if you don’t know how to plan ahead, budget, save or spend less than you earn – you’ll never be able to manage your business finances.
In business, cash flow is critical, so is an understanding of income statements, variable costs, direct costs, interest rates, gross profit, cost of sales etc. It’s not necessary to become an accountant but know the basics so that you can either do the finances yourself when your business is still small, or when your business is bigger and you employ a book keeper or accountant, you know what they are doing. If finances are not your strength it’s good to hire an expert but you should always have a basic knowledge so you know what’s going on in your business!
The final two tips come directly from Mr Raymond Ackerman. If you’d like more tips for entrepreneurial success you can read his books – The Four Legs of the Table and A Sprat to Catch a Mackeral (available at Pick n Pay).
6. Entrepreneurship takes 90% guts and 10% capital
However overwhelming the problem of funding appears to be, capital is 10% of what is required to start a business.
If you have a vision and you are convinced about the viability of an idea, given dedication, passion, single-mindedness, perseverance, integrity, and a goal that goes beyond making money it will be very difficult to not achieve what you set out to.
7. Keep your head in the sky but your feet on the ground
It’s important to think out of the box, to dream the impossible, to try things that no one else will and to believe in your ideas, but you also have to be realistic. Understand the practicalities involved in implementing and idea, speak to experts, use your networks and do the necessary groundwork. Getting the fundamentals right will help you in the long run and will allow you to keep your head in the sky so you can think of new ideas or ways to improve your business.
Lastly, one extra tip. Leaders deal in Hope. Stay positive and hopeful - it’s very seldom you see a successful entrepreneur who is negative and grumpy.
For more information visit www.ackermanacademy.co.za or contact:
RAA Cape Town Campus
UCT Graduate School of Business
Portswood Road, Green point
Contact no: 021 406 1422
RAA Soweto Campus
University of Johannesburg
Chris Hani Road
Contact no: 0115595583
By Elli Yiannakaris, Director of the Raymond Ackerman Academy of Entrepreneurial Development