The Entrepreneurship Test: Do You Have What It Takes to Run a Small Business?

As proven by failure rates — which, at last measurement, show that only about 20 percent of new businesses survive their first year — not everyone can be an entrepreneur. So, here’s the big question: Can you?

You don’t have to have an MBA or 50 years of industry experience to succeed as a small-business owner, but you do need a specific set of skills. This short guide should help you determine whether you have what you need to bring a small business to success.

 

Can You Be Decisive?

 
What is your favorite food? If you could travel anywhere, where would you go? What is the best way to flavor chicken? If you can’t answer these questions quickly and with certainty, you might have a problem with indecisiveness — and if that is the case, you might not be ready for entrepreneurship.

Entrepreneurs make hundreds (if not thousands) of decisions every day. They must decide who they will hire, how to price their product, what their brand colors will be, and which markets to enter, and why. By constantly second-guessing your decisions, you are delaying action and preventing your business from thriving. Decisive leadership is vital to small-business success.

 

How Do You Feel About Risk?

 
Business is inherently filled with risk; it is the entrepreneur’s job to mitigate risk as much as possible. However, it is impossible to avoid all risk, so you must be somewhat comfortable with taking chances to remain comfortable, confident, and successful.

Unfortunately, some people are more likely to take risks than others — which is to say: Men endure risks better than women do. Under stress, men are likely to increase their risk-taking, while women are likely to reduce their risks. The reasons behind this phenomenon are varied and poorly understood; it could be a biological difference in the brain or a gendered cultural upbringing. Regardless, you should be aware of your relationship to risk before you become an entrepreneur.

 

Do You Like People?

 
You might be the hardest-working, most brilliant person in the world, but if you can’t work well with people, you won’t be a good entrepreneur. Entrepreneurs are almost always around people, be it their employees, their customers, or their investors.

You must always be willing and able to make decisions, answer questions, and sell your business. If you have an extreme case of introversion, you should consider a less people-focused line of work — or bring on a partner to do all the social heavy lifting.

 

How Much Energy Do You Have?

 
Entrepreneurs do not work 9-to-5 jobs; entrepreneurs do not work 40 hours a week. When your business is young, you will be working constantly to keep it alive and growing, which means you will be getting up early, staying late, and coming in on weekends.

As you might expect, this requires boundless energy — of both the physical and the emotional varieties. You need your body to be strong enough to stay alert and focused while you are making important business decisions, but you also need to remain emotionally invested and committed to your work. If you often suffer from lack of energy, entrepreneurship probably isn’t for you.

 

What Are Your Hard Skills?

 
Soft skills are those you can’t easily learn in formal education; they are difficult-to-define personal attributes that make you better at completing certain tasks. Conversely, hard skills are specific abilities you typically only gain from intensive instruction: accounting, foreign language, computing, law, design, etc.

Ideally, you should have hard skills that pertain to both business and the industry of your intended small business. These days, you can find resources online for some business-related hard skills, like finance. However, if you lack any experience or education in business management or your business’s industry, you should probably return to school for targeted education in certain fields.

 

Do You Have Follow-Through?

 
In most cases, a business isn’t a short-term experiment. Unless you are hoping to sell your startup to the highest bidder as soon as possible, you should be planning in terms of decades as well as months. When properly managed, a small business can last a lifetime, providing you with a satisfying career and a sufficient income.

However, for your business to survive into the future, you need to be able to commit yourself to the business and see projects to completion. If you are the type of person who becomes overwhelmingly infatuated with ideas for short periods of time before abandoning them for the next big thing, entrepreneurship is not for you.

 
 
Are you considering entrepreneurship? What industry or industries are you considering starting a business in?