Entrepreneurship is sometimes characterized as jumping off a cliff and figuring out how to construct the parachute on the way down. Essentially an all-in, risky move.
Another analogy is playing roulette, putting your money on black, winning, and then do it again and again. The problem is, if you lose, you can be out of the game. Like going splat at the bottom of the cliff.
As businesses grow, the bets become bigger and bigger as the business operations become more complicated and the stakes are raised. That entrepreneurial spirit, the one of parachute construction, can quickly shift from asset to liability if a business isn’t careful.
Even if the odds aren’t binary or a coin flip, the tolerance for “failure tails” changes as businesses mature. Would you play Russian roulette for a million dollars? It’s got an 83% success rate – pretty good odds!
The counter to this risk is four protective pillars: tools, processes, people, and capital.
When these pillars support the entrepreneurial spirit, that spirit can continue to thrive within and even drive the business forward. There are many multi-billion dollar corporations who claim to have an “entrepreneurial culture” despite their size.
It’s never too early to invest in acquiring and building these pillars. Be sure to do it before the entrepreneurial spirit destroys itself!
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