There are two central ingredients to success: Risk and Persistence. I refer to them as “The Catalyst of Success.”

There are thousands and thousands of great entrepreneurial ideas out there. Millions of people have big financial hopes and dreams. There are a lot of people who can talk about their concept or idea with great conviction and flair—or about how they could improve an entire industry with their unique insight and experience.

But for all of the millions of ideas, concepts and plans only a very, very small number of them ever come to fruition.

I’d like to point out two of the most overlooked principles of making any business endeavor a success—in fact these principles apply to any worthwhile endeavor that we might choose to pursue.

The first is RISK and the second is PERSISTENCE. These two principles are absolutely necessary ingredients for success.

When I was a teenager I shaped and glassed my own surfboards. I became very familiar with the process of solidifying fiberglass using a mixture of resin and catalyst. In order to create a bucket full of solution that would cover the entire surfboard, I would add three or four cups of marine resin and just about a tablespoon of catalyst—that tablespoon made all the difference—it was the key ingredient that caused the entire mixture to eventually solidify into a hard fiberglass finish.

In my opinion, Risk and Persistence are like the catalyst that will complete the business plan, or any plan for that matter. It’s what takes a project through to the finish line.

The trouble though, is that many people are either paralyzed by the potential costs of taking risks and choose to avoid something potentially great altogether, OR after taking a risk; lack the patience and tenacity, aka: Persistence that’s required to see something to the finish line. In a sense, they throw in the towel prematurely.

I think you can start to recognize the importance of these two principles.

Do you have some insight and experience about how the principles of Risk and Persistence have affected your life? Or do you have a comment or point in regard to these principles from which the readers can benefit?

Leave a comment and I’ll follow up with a reply as soon as I can…

Building a business is tough. It requires great determination and self-confidence. But there are unseen dangers lurking within both of those necessary ingredients.

Pride, arrogance, and stubbornness often become the siblings of determination and self-confidence.

In 1999 one of the founders of Webvan confidently faced reporters, answering questions about the company’s sweeping vision of home grocery delivery. The company had recently raised a staggering $375 million in an IPO and was valued at over $1 billion. He explained how they would continue to assemble a gigantic infrastructure spanning the U.S.

When reporters began to question “profitability” and “proof of concept”, asking pointed questions about exactly how they planned to ensure that the business would be a success, the founder chastised, “…what you have to understand, is that we are very, very smart…” This was a supreme example of pride, arrogance and stubbornness.

Webvan expanded from the San Francisco Bay area to eight U.S. cities and initiated a $1 billion network of high-tech warehouses. But considering the super-thin margins of the grocery industry, a lack of user adoption or demand, and rabid spending, the company failed to complete it’s proposed 26 city expansion. It closed in 2001, wasting hundreds of millions of dollars, putting over 2,000 people out of work and dashing the hopes of thousands of shareholders.

As an entrepreneur, it is vital that you learn to balance determination and self-confidence with a healthy dose of humility and openness. Some of the best direction insight, you will uncover along the way will be the unexpected advice and feedback that will be provided from potential customers, investors, employees, vendors, or friends. Sometimes these are tough facts to face. It’s this advice that might force a change of plan or a painful course correction. But it’s that sort of insight that ultimately makes your business thrive.

Peter Drucker put it this way, “The greatest danger for the new venture is to “know better” than the customer what the product or service is or should be, how it should be bought, and what it should be used for…the new venture needs to be willing to see the unexpected as an opportunity rather than an affront to its expertise.”

Check out this great post for more information about this topic:

Success Starts With Humility

Everyday we receive hundreds of applications from entrepreneurs seeking guidance for their startup.

Here’s a summary of an application that recently came through:

Current Occupation: School Teacher

Current Income: $37,000 per year

Business Experience: None

Business Idea: I want to sell something online

Financial Goals: I want to make $500,000 in the next year

I guess with all of the infomercial and sales letter hype that’s out there promising immediate financial rewards, it’s hard to blame him for his unrealistic expectations.

Look, the great thing about entrepreneurship is that, in fact, a school teacher making $37,000 a year can go out there and start their own company and make $500,000 a year. It absolutely can happen. It happens all the time, actually.

But it won’t happen in a few months. It will probably take many years. And that’s ok, because the journey can and should be invigorating and enjoyable.

In regard to the time required for success, John Jantsch of Duct Tape Marketing summed this up recently. He said, “I know you need the quick fix, you want the result now, you need the hot new thing. Ask yourself this question–How long do you plan to be in business? If it’s more than a year…start planting seeds for your long-term growth by investing in foundational marketing practices that may take time to bare fruit, but ultimately produce the greatest returns.”

(He then explains the Foundation 3C’s of Marketing that require a long-term commitment, but lay the foundation of long-term business success.)

I think you should definitely go for those big, daring goals that excite you. But if those goals include making large amounts of money and being in business for the long-term; then expect a 3 to 5 year investment of sweat and discovery.

Just decide in the beginning to enjoy every day of the journey. It’s well worth it.

Check out these great posts for more information about this topic:

Anxieties of Waiting to be Successful

An Overnight Success

Setting Realistic Goals for Your Online Business

Success and Setting Goals