Personal Stories of America at Work

5 Myths of Entrepreneurship

With the economic plunge of the last several years, many professionals either have made the leap to running their own businesses or have thought about doing so. What it’s like to live in the shoes of a successful entrepreneur who makes a living helping other entrepreneurs? Enter Jim Horan, CEO and founder of The One Page Business Plan. During our interview with Jim, we cleared up some misconceptions about entrepreneurship.

Myth #1: Entrepreneurship is a lonely business.

Horan says that an entrepreneurial support group was one of the keys to success for starting and building his business. When he was invited, his host emphasized that this was a place to give to others, not to take from them. “I am stunned by the generosity of the entrepreneurship community. It is amazing what entrepreneurs will do for each other for free. I think it’s because people who are successful in small business are incredibly grateful.” Horan says, “The really successful entrepreneurs I know are always asking, ‘What can I do to help you today?’”

Myth #2: Business skills are the same as entrepreneurship skills.

Horan lost his corporate CFO job at the age of thirty-eight, on April Fool’s Day. Horan believes that many large company executives have a relatively high degree of entitlement, and that is not an option in building your own business. “I have recruited hundreds of consultants who have been senior managers. They have big-business skills that are only marginally transferrable to entrepreneurship. Most people don’t understand that running a $1 million business is a big and complex business. The range of skills required to do so is absolutely stunning.”

Myth #3: Successful entrepreneurs anticipate the future.

Horan explains that the path to a successful business is sometimes a winding and spontaneous road. “I accidentally became a public speaker, author, publisher, and licensor for the intellectual property behind ‘The One Page Business Plan.’ I couldn’t see any of those roles coming—it makes me constantly wonder what is coming that I can’t see? What am I going to need to do next?”

Myth #4: If you want to work on your own, you’re an entrepreneur.

“There are lots of people who are unemployed who basically want to create a job for themselves, but they don’t really want to create a business. I know a man, who’s in his mid-50s. He is starting a consulting firm, not because he wants to build a business, but because he needs an income. There are others who want to build a business that is ultimately sellable. In these cases, you need leadership skills. Even as a sole entrepreneur, you still need to be able to lead yourself.” Horan also notes the trend towards “outsourcing” expertise. “There are 27 million businesses in the US, and only 114,000 have more than one hundred employees. There are so many great contractors out there now, that we buy expertise in the amount that we need it. The independent contractors that make up my distributed workforce have been with me anywhere from five to thirteen years.”

Myth #5: Strategic alliances are an important part of building your own business.

Not so fast, Horan says. “I have made mistakes when I haven’t followed my intuition. One of those mistakes is about partnerships. I would caution other entrepreneurs about strategic alliances. They are really hard to make work. In these alliances, each person is expecting the other person to sell on their behalf. It sounds like it makes sense, but more often than not, they don’t work out the way you anticipate. My advice is to go do it yourself and then see who shows up along your path.”

Jeff Rosenthal and Molly Rosen | May 24, 2011 | Entrepreneurs, Innovation, Small business | 4

4 Responses to 5 Myths of Entrepreneurship

  1. Claire Wagner says:

    I’ve been an entrepreneur of sorts over the years, and I have to say that I was surprised at some of these, especially #5. Thanks for the great article – I now have lots to think about.

    • molly says:

      Thanks for your comment, Claire. The fifth point was a surprise for me as well. His point, though, is that many business people spend a lot of energy forming partnerships with others who may be selling a product or service to a similar market. For example, in the corporate training business, a small company might form a partnership with a larger training firm, thinking that the salespeople at the larger firm will sell the products of the smaller firm as well. Generally it doesn’t work out because 1) the salespeople know more about their own products, 2) they often receive better compensation on their own products, 3) they feel more in control of the relationship and the implementation if they don’t have to “complicate” it by involving the smaller firm.
      Entrepreneurs need to form lots of connections with others, but they can’t expect that anyone else will sell their product or service as well as they can. Thanks for reading!

  2. Tyler says:

    “Myth #4: If you want to work on your own, you’re an entrepreneur.”

    I definitely agree with you- that’s a myth. Entrepreneurship requires innovation and building a business, not just working for yourself.
    I actually just read a book called The Evolution of the American Dream (http://www.entrepreneurial-america.com) that addressed similar points to this article, but went on to say that entrepreneurship and innovation are two key aspects of the modern American dream.
    Thanks for the great points!

    • molly says:

      Thanks for the reference, Tyler! Most organizations, even large ones, are looking for those attributes of entrepreneurship and innovation. For years, we’ve talked about being a “free agent” and trying to unleash the kind of self-starter mentality that makes a great entrepreneur. Yet with all this talk, we still have high levels of disengagement among our employee population. Entrepreneurs who truly want to build a business, and not just run a sole proprietorship, need to ensure that they not only have those attributes themselves, but that the have the leadership skills to create an environment for others to flourish and contribute to building the business too. Something to consider when choosing which path to follow.



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