Entrepreneurial Instincts
I was talking with a friend last night about a billionaire entrepreneur who started two companies. He sold his first one for $600 million. He sold the other for $750 million.
That’s no coincidence. So called “serial entrepreneurs” have some common entrepreneurial instincts that set them apart from the average business owner.
These entrepreneurs assess business opportunities with a natural instinct.
Here are just two of these instincts (they’re closer to sicknesses, really!).
Compare yourself; do you possess them?:
The Due-Diligence Instinct: Natural, instinctive entrepreneurs have an innate tendency to assess businesses constantly. As customers or observers they’ll run random businesses through their own due-diligence tests. For example, in a restaurant, while silently looking interested in the dinner conversation, they’re actually calculating how much their meal cost. Then, they’re figuring an average plate price for the entire location and calculating how many patrons might dine on an average night. From there, they can guesstimate costs and a few other things about the success of the business. Once while waiting in line for the roller coaster atop of the New York, New York hotel in Las Vegas, I guesstimated that based on the $12 per ride charge and the amount of people still in line at 1am (about 100), the ride was bringing in at least $13 million a year. Not bad. Whether my figures were right or wrong isn’t the point…the point is…I was standing in line trying to figure out the business model–at 1am in Las Vegas!
The Solution Instinct: Natural, instinctive entrepreneurs have an innate tendency to think about how to solve problems. They are always looking while traveling or while they’re using some widget or service. They’re naturally thinking about how something can be done better or what might be lacking about a product, process, or system. Recently I read an article about a company that has come out with a new hanger to sell to dry cleaners. It’s sturdy, durable, cheap…and it’s made of paper. A high volume, environmentally friendly product with a highly targeted market. They’re eliminating waste and pollution by saving billions of metal hangers from being thrown in the trash each year. Their product is sweeping the nation. It’s a classic example of how an instinctive entrepreneur finds incredible new opportunities that are staring at millions of people every day–but it takes the solution instinct of a great entrepreneur to see it.
Tags: Business, business opportunities, entrepreneurs, Entrepreneurship, instincts
March 13th, 2008 at 11:48 am
Great post!
I would add that, combined with the above two instincts, a real entrepreneur must poses also “the execution instinct” - which, after assessing the idea and understanding that it solves a real problem, immediately push him or her towards creating the product / service. This is all coming from the entrepreneurial state of mind of “how CAN I make this happen”, as opposed to the “why it will never work” thinking.
March 13th, 2008 at 12:21 pm
lagon–thanks. And I do agree with you–the execution instinct is real. Knowing how to execute once an idea is found is an art unto itself!–Jeff
March 13th, 2008 at 12:57 pm
That reminds me so much of, humm ..me
March 13th, 2008 at 2:46 pm
Great post Jeff, thanks. I also find that I’m constantly looking for new ideas of businesses to start, looking at what others are doing that I might map on to what I’m already doing. It is a bit of a sickness. Always nice to know other people have the same disease!
March 13th, 2008 at 5:42 pm
dear jeff
hi
urgent
i need $50000 for buying home, yet
can you help me?
please responce me
nabi
March 14th, 2008 at 11:32 am
Great post. So many times entrepreneurship is seen as a response to a lousy j.o.b. or retiring too soon. As a lifelong entrepreneur, I also have the “tell me your dream, we can do that together, let me help” syndrome. I cannot NOT be an entrepreneur, any more than I cannot NOT be aware that there is need for my expertise in the world.
March 25th, 2008 at 7:39 am
Thats a great write up Jeff, i think to add to that would be an innate ability to take calculated risks - not risks mind you - but realistic risks. Ive seen that successful entrepreneurs wont take risks that have a high chance of failure, the ones that do usually are owners of businesses that crashed. Having said that, successful entrepreneurs arent too cautious either - they have a healthy mix of caution and risk taking. What do you think?
April 5th, 2008 at 12:25 pm
Comparison to the standard, so, my question would be, does that relegate my thinking into a zone?
April 6th, 2008 at 12:35 pm
Maliha-
Yes, your point is right on. You MUST take risks to be successful, however, they MUST also be reasonably calculated. The best venture capital firms in the world show us how to do this–they risk large sums of money but do a massive amount of due diligence before they take that risk. Thanks for the comment!
Jeff
November 5th, 2008 at 2:20 pm
[...] Entrepreneurs are a unique species. I wrote last month about some of the basic instincts of entrepreneurs when I introduced The Due Diligence Instinct and The Solution Instinct. [...]
November 19th, 2008 at 3:45 pm
[...] call the “instincts of entrepreneurship“. I’ve continued to research the way true entrepreneurs think and act; and the list of instincts has grown to become “The 11 Killer Instincts of [...]