September is drawing to a close. This last week of September follows a busy, eventful week. The 22nd of September marked the autumnal equinox. At the Asian Institute of Management (AIM), we welcomed Class 2019 of the Master in Entrepreneurship (ME).
Unsurprisingly, amidst more local news, the Viber chatter of both of the current batches of AIM ME entrepreneurs revolved around the bankruptcy filing of toy retailer, Toys R Us. The failure of global, storied businesses is always fascinating for business people – a warning that even those who have reached lofty, ambitious goals can fail.
Success
In the entrepreneurial classroom, the definition of success is multi-faceted. Whether an entrepreneur can call himself successful often boils down to the success of the enterprise. However, too many enterpreneurs sacrifice their personal lives to the enterprise. So that is a question we ask very early in the ME program. “If you wake up ten years from now, wildly rich, and legendary because of the success of your enterprise, but are alienated from family and friends, is that success?”
The reality, of course, is that many entrepreneurs establish businesses because they see an opportunity they believe they can mine, or because they want to forge their own path. The question I always ask is this: “If you can’t even take a vacation because you feel the business needs you 24/7, are you really successful?” The reality is some entrepreneurs end up becoming slaves of their business. Their personal lives are pushed out by business concerns. While devoting your entire life to your business may actually be a preferred choice for certain individuals, for many, it is an undesired effect.
In the ME program, we aim to help the entrepreneur achieve personal goals as well as enterprise goals. This conscious focus on the dual goals is important because simply owning a growing, profitable business is never the only goal for an entrepreneur.
In order to do this, we need to pay just as much attention to personal goals as to business goals. So the very first course in our program is one on Entrepreneurship and it begins with discussion of the “entrepreneurial sweet spot.”
Sweet Spot
The sweet spot occurs in that space where the enterpreneur is happy and the business is successful.
It begins, of course, with an idea, an idea that turns into a direction for your business. How do you know if the path you have taken for your business makes sense? Which opportunity should you chase?
First, the direction you take must involve an attractive market opportunity. Every business begins with a market opportunity. After all, if we cannot eventually develop revenue, there is no business.
Second, your strategy and business model must be economically feasible. In simple terms, you must be able to make money at this business. Ideally, we are looking at an opportunity that will allow us to grow profitably over the long-term. Now, here’s the kicker. What this means is that we must be able to build a business that can maintain competitive advantage over the long-term. As every entrepreneur knows, an opportunity is only an opportunity if the entrepreneur has the wherewithal to exploit it. What is it that the entrepreneur has or knows or can own that will allow him to best take advantage of the opportunity?
Aiming for Success
In the business classroom, we explain that shaping the profitable enterprise, especially in the early fast-growing years, can be boiled down to three critical matters: market, capability, and finance. The entrepreneur must be clear about how the enterprise intends to address the market. This means clarity about the primary target market and the core promise to the market. The core promise, of course, must ideally be valuable, differentiated and credible. He must also be clear about how to build the capability necessary to deliver to the market promise, as well as to sustain competitive advantage. Finally, the entrepreneur must completely understand the economic fundamentals of his business model – how we will build revenue, how he will structure costs, and how he will raise capital.
But all of this is just one half of the equation. The other half is personal. One way to address personal satisfaction is to actively carve out time for the self. The truly lucky entrepreneur, however, is one who manages to find something he loves and is able to build a business around it.
The research shows that happiness happens when we are able to engage in activities that provide both pleasure and meaning. The first job of every entrepreneur is to understand what it is that gives him happiness. Only then can they carve out their plans in oder to create both personal and business success.
This, of course, is not enough. There are many other lessons, including how to avoid the trials and travails Toys R Us is currently going through. But that is a story for another time.
Happy Wednesday and a warm welcome to ME 2019!
Readers can email Maya at [email protected]. Or visit her site at http://integrations.tumblr.com. For academic publications, Maya uses her full name, Maria Elena Baltazar Herrera.