Entrepreneurs are by nature risk takers, and I’m often asked the question as to how you can get comfortable living with risk.
I think the ability to make friends with risk is what sets entrepreneurs apart. Pretty much everybody I’ve ever met has an idea that could potentially be a business, but there are two factors necessary for them to quit their job & try and turn that idea into reality.
The first is passion. The enthusiasm & commitment that passion creates is necessary to get you out of bed on the tough days, & pick yourself up from the inevitable disappointments. No matter how great your idea is, there will be hurdles along the way & passion gives you the energy to get past them & keep going.
The second is your appetite for risk. Starting a business is always a risky venture, & you have to be able to balance the drive that risk delivers with the fear that it also creates.
The approach to risk that Stuart and I have always taken is fairly simple – we ask ourselves what the worst case scenario is, & can we live with it. If the answer is we can, we hit the go button. If the answer is that the worst case is unacceptable, then we look for ways to mitigate & get it to a point that we can live with, or we walk away.
It’s still possible, sometimes through circumstances you couldn’t reasonably have foreseen, to find yourself in a scenario where the worst case is unacceptable but you’re there anyway. That’s where a long practiced habit of risk management can deliver a great advantage. Rather than being paralyzed with fear over what might eventuate, you automatically swing into assessing the options & getting those mitigators underway.
Making friends with risk is key to successful entrepreneurship. Nothing great is ever achieved when you’re feeling comfortable, & taking on risk is a key part of getting to a position of discomfort. But articulating & owning your personal risk strategy allows you to manage that discomfort in a way that is empowering rather than rate limiting.