The ABCs of how to become an exceptional entrepreneur

It has often been said that entrepreneurship is the one profession where there is no apprenticeship. It does not matter how many books you read, how many certificates you acquire, how many companies you have worked for, or who your godfathers and mentors are. It also does not matter who advises you. There is no substitute to actual practise and experience.

In as much as the advice you are getting from friends, experts and your past experiences has potential value, the crucial decision of starting a business of your choice should be yours and yours alone. Whereas you need to observe due diligence by carrying out a feasibility study to confirm or plant a mental conviction, the future of whatever venture you start cannot be predicted through research or opinion of anybody irrespective of experience or profession. This is because as long as you are not duplicating or imitating others, your ideas are as unique as you are, and their potential no one including yourself can tell until you have tried. Here are certain traits that are a trademarks of an entrepreneur.

Initiative
Once you have strong conviction about a business idea, the noblest thing to do is go ahead and implement it. Do not be discouraged by critics; as long as you have products to sell, let the customers be the judge.

Emerson in his essay on self-reliance put it correctly when he wrote that, “There comes a time in every man’s education when he arrives at the conviction that envy is ignorance; that imitation is suicide; that he must take himself for better, for worse, as his portion; that though the wide universe is full of good, no kernel of nourishing corn can come to him but through his toil bestowed on that plot of ground which is given to him to till. The power which resides in him is new in nature and none but he knows what that is not which he can do, nor does he know until he has tried.”

Safaricom’s astronomical growth that saw it become the most profitable company in East and Central African with more than 12 million customers in less than a decade baffled both critics and shareholders.

It achieved a multi-year growth projection within a few years of opening business. No one expected so many people in Kenya, where more than half of the population lives on less than a dollar a day, to spend money on expensive airtime and related gadgets.

Google, the biggest search engine in the world, was created by two Ph.D students, Larry Page and Sergey Brin working for a project at Stanford University. When they discovered the business value in their creation, they abandoned their studies to exploit it, but not without great challenges.

They started working out of a friend’s garage. With users attracted to its uncluttered design and speedy performance, Google continued to rise while many of its dotcom competitors went bust.

An entrepreneur is more than someone who just invests money, oversees or manages business. An entrepreneur must first and foremost be someone who initiates an undertaking; a self starter; willing to come out of his comfort zone and overcome his fears and weaknesses. An entrepreneur is driven by conviction and the desire to make a difference which must be greater than the challenges and risks associated with the venture.

Decisiveness and determination
Entrepreneurs are action oriented. Robert Kiyosaki wrote, “After one of my demoralizing business failures, I went to rich dad and asked, ‘So what did I do wrong? I thought I designed it well?’ ‘Obviously you didn’t,’ rich dad said with a smirk.

“The world is filled with wannabe entrepreneurs. They sit behind desks, have important sounding titles like vice-president, branch manager, or supervisor, and some even take home a decent paycheck. These wannabe entrepreneurs dream of someday starting their own business empire and maybe someday some of them will.
Yet I believe most will never make the leap. Most will have some excuse such as, ‘When the kids are grown’, or ‘I’ll go back to school first,’ or ‘When I have enough money saved.’”

Entrepreneurs do not entertain or craft excuses for not making a decision once an opportunity arises. They rise to the occasion and follow their convictions rather than procrastinate and wait for the right time.

Responsibility
An entrepreneur must accept the outcome and take responsibility for their decisions. What you get in life is a direct result of what you do. The law of cause and effect states that there is a cause for everything.

Entrepreneurs do not blame the economy, politics, cartels or some other forces that influence are predominant in business. They take personal responsibility because they believe that they have the power to make decisions that can produce the desired results despite of those obstacles.

Willingness to take risk
An entrepreneur must be willing to face risks head on. Business is naturally a risk undertaking. Some risks can be avoided by wise planning and adequate research but others are inherent in business.

No matter how much research you do or how much meticulous planning you undertake, you can not predict fully how you will perform in the market. No business is immune to failure and no investment is 100 per cent secure. In most cases the higher the risk, the higher the returns.

Persistence
Most businesses take time to stabilize and bear fruits for the entrepreneur. This is where persistence is required. It has been observed that most people give up just when they were about to succeed. Entrepreneurs have tenacity to hold onto something they really believe in through thick and thin.

Innovation
Peter Drucker, the father of modern management said, “Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or a different service. It is capable of being presented as a discipline, capable of being learned, capable of being practised.

Entrepreneurs need to search purposefully for the sources of innovation, the changes and their symptoms that indicate opportunities for successful innovation. And they need to know and to apply the principles of successful innovation.”

This statement underscores that entrepreneurs are born and that they are some people tailored for entrepreneurship. In my conviction, we only have fast learners and slow learners, but provided we learn what we are capable of learning based on our passion and talents, we are bound to succeed.


Kiunga is the author of The Art of Entrepreneurship. mkiunga@queenexpublishers.co.ke

ARE YOU AN ENTREPRENEUR OR A BUSINESS-PERSON?

The term business-person and entrepreneur are sometimes used interchangeably although they mean different things
An entrepreneur is a person who conceptualizes, initiates and materialize a business process which is entirely unique and original. In other words an entrepreneur is someone who starts a business from a fresh idea and makes it work or applies an existing idea differently.
Merriam-Webster defines an “entrepreneur as a person who organizes and manages any enterprise, especially a business, usually with considerable initiative and risk.” The key words here are initiative and risk.
A business-person on the other had is someone who start a business on an existing market platform laid by the entrepreneurs. In this context entrepreneurs are business people but not all business people are entrepreneurs.
Being an entrepreneur is a difficult task. You have to discover your way through the market and get your brand or the product established. A businessman needs to be smart and invest in an established brand at the right time to make money.
How can a business-person become an entrepreneur? By injecting freshness, uniqueness and creativity in their business.
This is because it is easier to survive tough times as an entrepreneur than as a business-person. In entrepreneurship, there is less competition because products on offer are unique and easily differentiated. You have probably heard the classic idiom, “Don’t re-invent the wheel.” Personally I believe this idiom is fundamentally flawed and grossly mis-applied in dozens of situations.
It says that if something works, it should not be changed.
Nonetheless, almost all situations, the wheel is never perfect and there are better designs, better ways of doing something. In this case it makes sense to re-invent the wheel. As Mark Twain once said, “Even if you are on the right path, you’ll get run over if you just sit there.” In late 1990s Barclays Bank introduced unsecured loans, a very unique product at a time when many banks were dealing with high rates of loan defaults and non-performing secured loans.
Other banks decided to adapt a wait-and-see approach on this ‘weird idea’ . I was personally amazed when a whole sales team from the bank invaded my office with forms ready to give anyone money without collateral.
New ways
It took almost half a decade before other banks realised there was money to be made by giving unsecured loans. What is more, the security they held so dearly did not guarantee repayment. By then Barclays had grown tremendously, establishing itself within the unsecured loans niche where it has remained unchallenged.
Another example is Equity Bank. Although it existed as a micro-finance institution for close to 20 years, it only attracted national and global attention in the late 1990s.
During that time Kenya was experiencing its worst post-independence financial crisis in the banking industry with most institutions closing their countryside branches. To make profit, they had to charge customers very high ledger fees and raise the minimum account balance.
But Equity amazed both its competitors and customers. As relatively new establishment without financial expertise and muscle, it started opening branches in the very places where the big banks where shutting down. In total defiance of logic, the bank waived ledger fees and set up almost negligible minimum operating balances. Once again, the rest of the industry adopted a wait-and-see attitude.
After redefining the banking rules and succeeding, other banks followed suit. It did not invent banking, but invented new ways of dealing with customers and new services that suited the mass market. Equity lived up to its slogan, “The Listening Caring Financial Partner”, moving from business to entrepreneurship.
In his book, Diary of a Mad Businessman, Delano White writes, “Business innovations generally start within small businesses. The greatest innovations are not thought up in corporate boardrooms. They originated in dorm rooms, working lofts and basements. Creativity drives business and our society. Without the initiative taken daily by ground business owners, society would be at a standstill.”
What we need to improve our economy and our lives is more entrepreneurs and fewer business-people.
This article is derived from The Art of Entrepreneurship by Murori Kiunga.
mkiunga@queenexpublishers.co.ke

HOW TO BE A SMART ENTREPRENEUR

Business and indeed life, is a game of power where the mighty triumph over the weak. It is the person or the institution with the greatest power, real or imagined, that gets the best deals in every negotiation.

The term power in this sense is not restricted to political, economic or other familiar and often sought- after. Power is anything that gives you some leverage over the other party. As such it could be your ability to reward or withhold something, hurt or take any other appropriate action. It could be your knowledge skills, experience or ability to influence decision or persuade others. Thus all of us have some forms power and lack others, of which how we use determines whether we succeed or fail.

As a cardinal rule in life, people will not enter into negotiation with you unless they are sure you have some power either to benefit or to hurt them.

This power is not always real. Sometimes it is either imagined or exaggerated. Power like beauty, is in the eyes of the beholder. It is largely a perception.

All successful people, irrespective of their fields have some sort of power in the eyes others who matter. They have created a perception of being able to help or hinder the other person in one way or the other. The American swindler Bernard Maddoff conned investors by presenting himself as someone who is capable of helping them increase their wealth, although he was just operating a Ponzi scheme.

You pay your financial advisors handsomely because they have created a perception in such as way as to make you believe that they are an authority in financial matters and can help you attain financial stability, although in reality they could be struggling with their own.

There are several ways you can create a perception of power and gain leverage in any negotiation, and especially in business. This is by possessing or posing as if you have some forms of power over your target.

One form is scarcity or rarity. If you make the other party believe that the product you are peddling is scarce and in great demand, they will give you the best deal. This applies to you as well. If you are making an appointment, you can increase the commitment of the other person by stating emphatically that you are available only at-such-and-such time as opposed to the polite way of saying you are free the whole day and you could meet them at their convenience.

The second form of power is by being tactically indifferent about the outcome of the negotiation. Weather you are negotiating for a job or for a sale to go through you should let the other party know that you do not care much about the outcome. Remember the last time you went to buy something and the seller, on realising that you need the item dearly, pretended to be busy and uncaring on weather you buy it or not. This dramatically increases your desire to own it and diminishes your negotiation power to their advantage.

The third source of power is knowledge. The person who is perceived as an expert is always respected in a negotiation, especially if the person is not equally knowledgeable. Therefore ensure whether you are selling or buying, you do your homework well, research deeply and arm yourself with all the relevant knowledge of the subject.

The fourth source of power is courage. You demonstrate courage by articulating your views clearly, refusing to be intimidated and stating your readiness to walk out if your demands are not met or accorded due respect and consideration.

The fifth major source of power is commitment. You should affirm you commitment to take any necessary risks and responsibility to make the negotiation a fair deal and not otherwise. This will disarm the other party and make them cooperate with you. If the other party thinks you are not serious, they too will not treat you seriously.

The sixth source of power is your image and especially how you dress and talk. Image, it is said, is everything. Your attire gives you a form of authority which if combined with the way you talk can easily intimidate the other person, especially if the other person is not equally immaculately dressed and groomed. If the other person does not know you, they will judge your social status, financial status and even intelligent from your dressing.

The seventh form is reward or punishment. For the other person to really cooperate and value you they should perceive that you have the power to reward or punish and you would not hesitate to use it appropriately. In business you feel more intimidated by the person who can make a purchase order outright than the one who has to consult or recommend.

The eighth form is investment. If the other person knows that you have taken a lot time and resources in the issue under negotiation they know you are serious and not any other joker. For instance if the other person who want to sell you are car knows that you have seen many other cars and researched into various features and models in the market, they will know you are a no-nonsense person who will not take anything short of the best.

The ninth form is empathy. Human beings are creature of emotion and not logic. You should show that you care for the other person feelings and interests albeit being firm in your demands. By understanding the other person’s situation and acknowledging so, you create a bonding relationship that gives you leverage.

Finally, you create an aura of power by behaving in a suggestive manner without elaborating. Power is a mystery to those who don’t have it. Whether you have it or not, be mysterious and do not claim or try to prove it and people will treat you with caution. Remember a tiger does not shout its tigritude.

A prominent trainer said every time he gets a poor service at a facility, he would take a note book and politely ask the employee their name rather than complain.

The employees of course give reluctantly but from that time onwards service delivery improves dramatically. The impression here is this unknown person could be anybody powerful capable of taking unspecified action. Unless and until the particular staff knows his position, he will be treated like a king.

Murori Kiunga is the author of The Art of Entrepreneurship and The Winning Character all available in leading Kenyan bookstores. .

THE ICEBERGS

When you look at an iceberg floating on the surface of water, you see only a small portion of the whole iceberg. The density of pure ice is about 920 kg/m³, and that of sea water about 1025 kg/m³. Therefore it is only about ten percent of the volume of an iceberg is above water.
The actual shape and size of the portion underwater is difficulty to judge by looking at the portion above the surface. Success is like an iceberg in many aspects. When you look at the people who have achieved much in life, you see only a small portion of what is behind it.
You do not see the many challenges and obstacles they have encountered before succeeding. You do not see the humble beginnings, the risks they had to take, the many blunders they made, the many sacrifices they had to make and the many loses they made before turning this round.
It seemed unbelievable when astronomers revealed in the 1930s that 90 per cent of the universe is invisible. This means the countless stars you see at night are a tip of the iceberg! But of greater interest is the assertion that this invisible material, which they called ‘dark matter’, holds the key to the eventual fate of the Universe.
And recently a renowned economist though admitted that he was only making an intelligent guess said that only 10 percent of the wealth is visible but the 90 per cent which is invisible holds the key to our eventual fate; whether it will grow, stagnate or collapse.
Many people associate success or failure with visible things like academic achievements, good family background, right connections, luck and hard work. However evidence is conclusive that there is more to success than what meets the eye.
Thinking boldly and broadly what makes or breaks us is not tangible. It is invisible, supported by our faith and expectations of the future. This is why we see people of modest means acceding to great achievements within a relatively short period of time, or people swimming in wealth and glory becoming desperate paupers in a twinkling of an eye, allegorically speaking.

The dark matter in your life
Successful people are admired and emulated and even looked upon for guidance in life, and in death they immortally remain as source of inspiration and precedent to teach successive generations the art of successful living.
We all look with awe at people deemed successful in their time. People like mahatma Ganthi, Nelson Mandela, Barack Obama, Warren Buffet, Bill Gates, and Mother Tresa, Wangari Mathai Winston Churchil and many other unsung heroes and heroin epitomize success by overcoming adversity to achieve goals larger than their lives.
What is common with all these people is they come to limelight as they ascended to success when much ground work has been covered. What we so often do not see, unless in hindsight, is the many years of preparation, sacrifices hardship, failure, and disappointment they had to persevere before even gaining other peoples support. But still all these are just a tip of the iceberg.
The real force and this is why it is impossible to attain success by aping and imitating successful people, lies in the dark matter.
One dark matter is optimistic future outlook. This is the faith and expectation that the future has better things in the offing. I once wanted to buy a piece of land in a certain areas in Nairobi. I shopped around and identified some plots that were on offer at between two to there million.
Six months later when I visited the areas I was shocked to find the price had doubled. I went to my agents and they told me offer is no longer there. When I enquired why the sudden surge in price they told me several things had taken place since I was there. he told me that there are rumors that the roads in the area are about to be tarmacked and certain institution had bought a big chunk of land there to put up modern hospital and a school. He added that several big people had already bought land there.
The price of land appreciated beyond my reach because of mainly intangible factors that lifted future expectations of the place. The same thing happens at the stock market where the price of shares can swing up and down, making people richer or poor depending on future expectations, fundamentals notwithstanding.
Honesty is another dark matter. People what to deal and associate with honest people. Honesty breeds good reputation, which in turn lead to trust in you. Once people trust in you, you will succeed in anything you do.
Honesty is the greatest of all virtues that benefit you and the other person. Its absence damages you more than the person you cheat. Philip Bailey said,
“To cheat oneself really, that lies at the heart of every human act of deception. The traveling businessman who pads his account or mis-presents his production is cheating himself, not his company. The student who takes exam in dishonest fashion is cheating himself not his school. The wife who carries on illicit affair with a secret lover is not cheating on her husband but on herself. The salesman who violates the rights and confidence of others by withholding information or exaggerating beyond the truth is cheating himself, not the buyer. The writer who lifts the writings of another and inserts them into his own manuscript without giving professional credit cheats himself, not his reader.”
Reputation is another dark matter. People are often paid more money for reputation than hard work. Former American president Bill Clinton was paid $130,000 to
deliver the keynote speech at the annual convention of the Asian-American
Hotel Owners Association (AAHOA) in 2001. This is more than what most senior chief executive officers of most performing companies take home in one year.
Great leaders, authors, professionals as well as entrepreneurs ride high on their reputations. Reputation is fundamentally a matter of perception, earned over a long period of time, making it priceless, and a powerful source of leverage.
In business quality is dark matter matter. If you produce quality products and offer your customers sterling service you gain a competitive advantage over your competitions. You can charge a premium and still customers choose you rather than your competitors.
By improving your own quality by upholding human values and setting a high standard guided by accepted morals you become a better person.
Most people fail to succeed in life because they focus on what can be seen: education, job, money, social network…or lack of them, forgetting the invisible assets such as reputation, honesty, creativity and so on which account for 90 percent of our success.
True and lasting success can only be realized by focusing on our dark matter which cannot be stolen or tempered with, without our consent.