Risk is not the issue. Uncertainty is. The lot of any entrepreneur founding a business is prolonged uncertainty over the years. Extreme emotional turmoil is an integral part of the experience, particularly if they seek to grow the firm over the decades. The figure below, The Dark Night of the Innovator, provides a take on the early stages of the process.
For half of the aspiring founders incorporating in any year, it is two years or less before the business fails. That is a long hard night to cope with, particularly alone. For the next thirty percent it is less than a decade before that venture is over. Still Taking Care of Business, the biography of Randy Bachman of The Guess Who and BTO fame, abounds with insights for entrepreneurs on that journey.
This is the reality for business founders in Canada, one of the best places in the world to start a business. The Federal government makes it easy to take the first step — low cost, online incorporation at the time and place of your choosing. Applicants get affirmation of their new corporation within hours. So, the question is not can you start a business but should you and your colleagues do so?
The Kemball Group’s view point on the question was aptly stated by Sun Tzu, “If ignorant both of your enemy and yourself, you are certain to be in peril. …If you know the enemy and know yourself you need not fear the results of a hundred battles.” We will work hard alongside you if you wish to avoid unnecessary peril and win a hundred battles.
Avoidance of peril when uncertain challenges us all. A former US Secretary of Defense depicted real world uncertainty in terms of what we know; there are known knowns, known unknowns, and unknown unknowns. For entrepreneurial companies, known knowns can be wrong and still spell great opportunity; metal ships won’t float, heavier-than-air machines cannot fly. Opportunity knocks for the innovative but not necessarily profitability. Known unknowns with uncertain implications are prevalent; “I think there is a world market for maybe five computers.” Thomas Watson Sr. Opportunity knocked then but not for everyone. Unknown unknowns may be tomorrow’s opportunity. More likely “tomorrow” will come in your life time but not in time to make a profit and survive to benefit.
Most entrepreneurs believe that they need other peoples’ money to grow their business, angel and venture capital in particular. This is a “known known” that is wrong for more than 97% of businesses seeking it. Only those growing sales at 20% a year or more for a decade need even consider that type of funding. Unfortunately many a good business wastes time chasing this kind of capital where the odds of getting it are less than one in forty, 2% to 3%. Tragically, some of those who should get such money do not, solely because they are ill prepared.
While seeking to prevent a tragedy, snatch funds from the jaws of a defeating turn down by being 100% prepared, The Kemball Group also adds value by advising entrepreneurs to avoid wasting their time preparing and chasing the wrong kind of money from the wrong people for their business. The value to entrepreneurs is the value they create with the time saved, by pursuing the right kind of money for their business and their goals.