What makes an entrepreneur? | Article – HSBC VisionGo
When the pandemic struck hard last year, a lot of people who used to work regular hours in an office switched to working from home. During that time, people didn’t even get to go out for entertainment after work. While that helped reduce the spread of the virus, it also released lots of extra time and space for thinking.
This extra time, coupled with the explosive development of technologies that facilitate remote working, have enabled some people to succeed in turning their hobbies or side hustles into a serious business. Last year in the United States, 4.3 million new businesses were started, up 24% from the previous year. In the United Kingdom, over 400,000 start-ups were formed in 2020.
So what are some of the attributes of a successful entrepreneur?
#1 Get comfortable with risks
We are all familiar with Elon Musk’s story. He started investing in SpaceX in 2002 to develop space travels, with the aim of sending people to Mars. In 2004, he led his team to develop the electric vehicle Tesla. At that time, not many people thought this concept would work.
In the beginning, Musk thought SpaceX and Tesla had less than 10% likelihood to succeed. He said, “If you were to do a risk-adjusted rate of return estimate on various industry opportunities, I would put building rockets and cars pretty close to the bottom of the list.” But he still chose to develop these two businesses, because he believed these two companies would be capable of making the world a better place. His inclination towards risk-taking has enabled him to start one after another business, and bring innovations to humankind.
Another serial entrepreneur, angel investor and author Dr Somdutta Singh established the e-commerce platform Assiduus Global in India. It is the global exclusive distributor and supply chain partner of a number of Fortune 500 companies. When she first started her business, Dr Singh well understood that she was getting into a high-risk, high-reward game. In her view, if you are brave enough to take risks in uncharted waters, you are already at a competitive advantage. She said, “You can only sketch a winning business strategy, explore additional financial developments and modify initial performances if you have taken the plunge into the unknown. With each dive, I believe you will only emerge stronger.”
#2 Persevere in the entrepreneurial dream
As people start their own business, it’s inevitable that there would be moments when they doubt every decision they make, or even go through an existential crisis, feeling that no one would buy their products or services. To succeed in starting a business, one has to persevere in one’s entrepreneurial dream. At the same time, it’s important to understand the need to adjust the strategy when necessary, or even withdraw from the business completely, reorganise the strategy and start afresh.
Alessandro Savelli is the founder of Pasta Evangelists. Since 2016, he has been successful in selling fresh pasta dishes in the UK through subscription. The pasta dishes are delivered to the customers’ doorsteps, and it takes just five minutes to cook them for dinner. In March 2020 when the pandemic was severe, during the first 10 days of lockdown in the UK when people had to stay at home, Pasta Evangelists started a new business of cooked pasta delivery straight away. Partnering with Deliveroo for delivery, Pasta Evangelists’ business grew tenfold during those few days.
But in fact, before starting Pasta Evangelists, Savelli had a business developing and selling smartphones. He spent eight years’ time and efforts but ended up having a big loss in the company. He had also started to see that developing phones wasn’t what he really wanted to delve into. It dawned on him, “If I was going to carry on as an entrepreneur, I had to focus on something that was close to my heart.”
In 2016, he closed his phone business, and started Pasta Evangelists the following day, cooking the company’s first dish using his grandmother’s recipe. In January 2021, Pasta Evangelists was acquired by the internationally renowned pasta company Barilla Group, reportedly for GBP40 million. Savelli continues to lead his company as its Chief Executive – and continues to develop a business that is close to his heart.
Savelli has understood that giving up a non-viable business does not mean giving up his entrepreneurial dream.
#3 Be adaptable in getting hold of business opportunities
Besides identifying industries that they are passionate about, adaptable entrepreneurs would also bring customers products and services according to their needs.
Yeung Ka-ho and Yiu Kam-sum are graduates of Data Science and Analytics from the Hong Kong Institute of Vocational Education (IVE). They have a strong interest in big data and AI. They started their company in early 2020 to help clients raise their operational efficiency by bringing them tailor-made AI systems developed through data analysis. During the pandemic, they first helped an electronic goods recycling company develop an “AI electronic appliance screen deterioration detection system”, which enabled the client’s employees to examine computer screens remotely, and then re-sell them to recycling companies.
Hong Kong people love eating, while not forgetting to watch the nutritional value and their weight. Ka-ho and Kam-sum have also developed an app about nutritional value, which allows users to easily calculate the amount of food they should take in and provides suggestions. These two seemingly unrelated products are in fact the outcome of Ka-ho and Kam-sum’s knowledge in data science, their market sense, and successful commercialisation.
As long as you can get hold of opportunities and keep an open mind, even if something looks completely unrelated, it could be a business opportunity.
#4 Stay on top of the company’s finances
These examples illustrate that when people start a business, it’s usually not just for monetary returns. Nevertheless, financial management is a pre-requisite for any business to succeed. Whether a business is sustainable largely depends on whether the company has a healthy financial situation, and whether it can react quickly to capture every opportunity.
Entrepreneurs need to stay on top of their finances, so they have to be able to check their bank balance and fund in/ out status anytime, anywhere. To avoid losing any opportunity to competitors, they also need to make payment to businesses or partners in a timely as quickly as possible. Meanwhile, running a business in Hong Kong very often involves the use of foreign currencies. Being able to capture the best timing for each foreign exchange transaction will help save a considerable amount of money in the long run.
A reliable mobile banking app can help entrepreneurs execute appropriate commercial decisions immediately. In case their financial situation becomes difficult, they will also be able to detect problems early and adjust their strategy.
Taking HSBC as an example, if you are a Commercial Banking customer, you can use the HSBC HK Business Express mobile app anytime to check your account balance and fund in/ out records, make local and international payments, and buy or sell foreign currencies. You can also set up “Rate Alert” and “FX Order” instructions on the app, so that when your target exchange rate is hit, the bank will automatically execute an FX order for you.
With the Business Express app, a smartphone becomes a Mobile Security Key, which replaces the One Time Password generated by the conventional security device. Using the biometric recognition feature on your smartphone, you can log into mobile banking, and authorise transactions or desktop internet banking log-in. So there’s no need to carry the physical security device with you all the time.
You may often be too busy to take care of your bank account. You can set up push notifications in the Business Express app so that you will be prompted whenever situations such as overdraft or returned cheque arise, or when a fund is deposited or an outward transfer takes place.
Compared to starting a business in the old days, managing a company’s finances has become so much easier.
#5 Take care of your mental health
According to research by Dr Michael A. Freeman of the University of California San Francisco in the United States, entrepreneurs are 50% more likely to report having a mental health condition. “People who are on the energetic, motivated, and creative side are both more likely to be entrepreneurial and more likely to have strong emotional states,” said Dr Freeman.
Earlier on in the Davos World Economic Forum, mental health was one of the discussion themes. It was pointed out that there are steps that investors in start-ups could take to actively support start-up entrepreneurs’ mental health. For example, as they review a company’s performance and financial return on investment, they should take the mental health state of the founder of the business into consideration.
It is very important to build a support network for yourself, which may include your family, staff and other entrepreneurs. Too much opinion might confuse yourself; but what about inviting a few friends who you respect and trust and who can understand you and your business to join your “Board of Advisors”, who you can approach regularly or as necessary to discuss with them and seek their opinion? That will help you feel less lonely, and therefore relieving your psychological pressure.
The journey of entrepreneurship – the road that nobody has taken before
Hopefully these examples from different parts of the world would bring some food for thought to those who intend to start a business or have already started. Nevertheless, being an entrepreneur means doing something no one has done before, and there is no formula of success. Whenever you come across an opportunity, that’s when you should start your journey!