Tag Archives: Entrepreneurship

Laying the Entrepreneurial Foundation

Anne Hargrave
Anne Hargrave

At a recent gathering of 100 family business and family office advisors, from numerous professional disciplines, there was an expansive discussion about what it takes to foster entrepreneurship in business, philanthropy and wealth management.

Over the course of two days, a few themes surfaced around specific actions parents might take to instill qualities often found in successful entrepreneurs, such as…

Create a Foundation for Resilience. Resilience surfaced as the most common thread in entrepreneurial success stories.  Healthy relationships, sound health, eating and sleeping well, and physical activity all create a foundation for resilience.   When relationships amongst people in a family are healthy, individuals can withstand stress, even trauma.  When you feel resilient you are more able to view risk as a means to reward (not an impediment), and gain strength and courage from difficulties.

Insist on Respect. 
Being considerate of each other, demonstrating respect, is the tie that binds, even more than love. When we allow family members to define themselves, appreciating and celebrating differences, they can then embrace their own strengths – fostering confidence and self-esteem. When someone feels respected they are more able to believe in possibilities and their own personal ability, and dream actively – a foundation of entrepreneurship.

Embrace Failure.  Treat failure as a given; celebrate failure.  Some families actively seek out failure examples at the dinner table, or in family meetings, to explore what was learned and how the experience can be turned into another opportunity.  Making failure acceptable and expected encourages resilience, courage and the inner strength to continue to move forward.

Look for Mentors. Encourage family members at an early age to ask for advice, learn from others, and shape and create opportunities.  Mentors can be found through school, athletics, community, social relationships, business contacts, and family members.  Entrepreneurs generally have a strong work ethic influenced by those around them who modeled the right behaviors.  Mentors can help frame up a vision for the future.

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The Power of Mistakes

Stephanie Brun de Pontet
Stephanie Brun de Pontet

Nobody likes to make mistakes – but avoiding mistakes at all costs may be a big mistake…

First, everyone will make mistakes – you cannot realistically avoid this. 

Living in a bubble, making no decisions and generally staying away from life will still lead to countless errors of missed opportunities.  Don’t forget – there are mistakes of ‘commission’ (things you should not have done) like accidently insulting a key supplier, or making an error in your financial analysis – these you can avoid by taking no actions and making no choices.  Yet, there are also mistakes of omission (things you should have done, but failed to do) like not returning the call from your brother because he is difficult, or not following up on a sales lead  – and living on the sidelines trying to avoid any responsibility will lead to those mistakes every time.

Second, most successful businesses are built on a trail of mistakes. 

By that I mean most entrepreneurs failed many times before arriving at their current success.  It is not that entrepreneurs are wild risk takers – rather they do not see risk in the same way others do, and they are very skilled at learning from their mistakes.  In order to break new ground, truly innovate and bring a new product or service to market, the entrepreneur has to be willing to engage in a lot of experimentation, trial and error, and mistakes. The best advice I have heard on entrepreneurial mistakes is to ‘fail fast’ – that is, commit to a path or idea – be willing to make a big mistake, but then know quickly when to pull the plug, learn from the mistake and make the needed adjustments to try again.

Third, mistakes will help you uncover your path and full potential.

If, like many people, you are not clear about your path in life, trying a range of paths and ideas will help you to uncover first what you don’t want to be doing (the mistakes) which will help inform your understanding of what you should be doing.  If you are unwilling to try new things for fear of failing or making mistakes, you will never have the opportunity to discover what truly energizes you.  Note that even if you are clear on the path to success you want to follow, you cannot really reach your potential without making mistakes as you take the hard turns on that path.  If you never make a mistake – it isn’t that you are particularly gifted, it is rather more likely that you are on the path of least resistance and not taking the risks you need to reach your full potential.

These quick reminders of the value of mistakes can be important for families in business together because once a family and business have experienced great success and stability – it can be hard to remember the journey of failure and mistakes that lead to this outcome, and easy to fall into the trap of playing defense and striving only ‘not to fail.’  Both the business and family members need to continue to be willing to make mistakes to grow, evolve, and find their full potential.

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Inspiring Entrepreneurship in Family Business

By JoAnne Norton, Ed.D.

The early morning sunlight warmed the meeting room where the forty-five members of a large fourth-generation family business gathered on the last day of their family’s retreat three years ago. The room had a panoramic view of a pristine lake nestled among fir-tree covered mountains—a vista that easily inspired long-term visions and harmonious values.

Through a series of visioning activities the family members had confirmed that they wished their family business would last for many more generations. They were, however, faced with the challenge that their wealth was invested in mostly mature industries. After a discussion of where they were then and where they needed to be in the future, the family members divided themselves into special interest groups based on how best to achieve their vision. One group, composed of members of the third and fourth generations, determined it was crucial to find new sources of revenue for the future. To that end, they formed a special “Entrepreneurship Committee.”

Over the last several years the group has been exploring ways to grow and nurture entrepreneurs in the family in order to expand their wealth thereby ensuring that they can continue as an enterprising family. At next summer’s family retreat several of the successful entrepreneurs in the family have been asked to share stories of how they started their own businesses, what their biggest challenges and biggest rewards are, what has worked and what hasn’t. In addition, members of the fifth generation, who are high school and college age, will have the opportunity to work on an entrepreneurial project together, coached by some of the entrepreneurs in the fourth generation.

What’s so exciting about this family’s hard work to inspire and educate budding entrepreneurs in their family, is that recently released research indicates they are definitely on the right path to being a long-lasting family enterprise. In December of 2011, the results of the Family Firm Institute/Goodman Study on Longevity in Family Firms were released. Robert Nason, Thomas Zellweger, and Matttias wrote “From Longevity of Firms to Transgenerational Entrepreneurship of Families: Introducing Family Entrepreneurial Orientation,” which appeared in the Family Business Review (XX(X) 1-20). The researchers found that the key wealth creation vehicle is not the firm but the family.  Nason says families should focus on the sustainability of wealth, not on the longevity of a particular operating entity, and one of the things Nason recommends is emphasizing the founder’s entrepreneurial spirit.

If you are in a family business, what kinds of things are you and your family doing to encourage entrepreneurship? Please share your stories with us on this blog.

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