One of a hundred

Business is an art.

In order to succeed as an entrepreneur, you need talent similar in intensity and vigor to that of a military man, a sportsman or a musician. But the talent of an entrepreneur is peculiar in that it is indiscriminate: there is no area of life where it is useless. It is equally necessary in culture and sports, economy and politics, education and finance.

According to scientists, only 4 percent of the global population – 4 people out of a hundred – are particularly gifted and talented. They might not have the highest grades in their high school diplomas, they may even drop out of university, but they have a gut instinct for success, an intuition, healthy adventurism, pioneering bravery, and no fear of the unknown. Such people never lose heart, and misfortunes just make them more persistent and goal-oriented. That being said, the same researchers claim that only 1 in that 4 has the gift of a true entrepreneur.

I am not an expert in that field and I would like to see these numbers subjected to careful verification. But recall your final year at high school or your circle at university: how many of your peers were successful or talented in some way? You will see that the answer is no more than 4 percent, and only one of them was truly talented and successful as an entrepreneur. Just recollect your schoolmates and circle at university!

Why am I putting such an emphasis on these calculations? Because I am convinced that certain regularities are not only found in mathematics. One can also see them in entrepreneurs’ training – a branch of study that has already emerged and is developing rapidly. In a city with a population of 100,000 people, only 1,000 can become truly talented entrepreneurs.

It’s no secret that small and medium-sized enterprises on average provide up to fifty jobs. That means a city with a population of a million people should have no less than 10,000 successfully operating entrepreneurs able to create up to 500,000 jobs, and thus guarantee employment for the entire working-age population. In Russia, however, such calculations are subject to correction because of red tape and corruption.

Evaluate yourself and your abilities: are you ready to walk the path of uncertainty and ambiguity by yourself? Are you ready to limit your own freedom by a conscious decision and to face legal restrictions? Are you ready to move forward through a series of wins and losses? Are you ready for the changes in your social circle and a possible loss of close friends who are not going to follow you into the business world? In short, I am asking once again: are you ambitious enough, competitive enough, do you have the desire to become the best in your field?

One who is indifferent will never become an entrepreneur. Business success is rooted in the non-material, so those who have achieved some success, bought a house in a prestigious part of the city, gained a certain status and a reputation, and then rested on their laurels, can be said to be “the indifferent”.

If you are basically indifferent to work, if you feel more comfortable following orders and receiving instructions, rather than giving them, if you prefer to limit yourself to a small number of tasks and responsibilities, you are unlikely to become a real entrepreneur. Even being a leader is not enough. Yes, an entrepreneur is always a leader, but not every leader can become an entrepreneur.

Studying various businesses, including foreign ones, I have repeatedly found that the profits of many entrepreneurs do not surpass the salaries of managers in big state or private companies. The question is: why would you struggle, take risks, deprive yourself of sleep. What for? Not everyone is ready to answer that question honestly, but I know the secret: an entrepreneur is always driven by ambition. It is better to be the first and get less money, than the second and earn a lot – this is the principle that guides those who decide to open their own business. As for the average leader, they try to work within the limits of their competence and follow particular rules.

– Business case —

…When I was already an established entrepreneur, I was offered a job in a big corporation. I accepted the proposal because the experience was interesting to me as an opportunity for self-fulfillment and self-examination: am I ready to work under someone else’s control and within established rules? I was very curious to find myself inside a huge corporative mechanism, to understand the levels of freedom and responsibility of a top manager.

I instantly saw a huge number of disadvantages in this inflexible and conservative system. I felt highly uncomfortable: it was sad to see decisions taking ages to be made or scheming and artificial obstacles standing in the way of effective and useful suggestions. However, at the same time, I saw dozens of leaders (managers and top managers) who felt quite at home in this environment.

We spoke different languages: I wanted to profit from every process, suggested changing many things; but they acted strictly within the margins of their responsibilities, until they received new tasks from their executives. The most important thing was to follow orders accurately and on time, otherwise they were guided by the principles of “do no harm”, “do not hurry to follow the initial instructions, they might be cancelled by the following ones”, and “do not jump the gun”.

I realized that the environment of corporate business was not for me. On the plus side, it consolidated my belief in that being an independent entrepreneur was personally more comfortable than being an executive in a huge corporation.

Then again, it is not only entrepreneurs who try their hand at occupying various positions in medium, large and gigantic corporations. Very often it is the other way around: successful top managers decide to become entrepreneurs. As a rule, at the beginning those are offshoot-businesses through which former senior executives either start supplying materials and equipment to their former employer, or become mediators in the provision of services (or manufactured goods) for that corporation. It is quite clear why it happens this way: the clients are already there, the suppliers are familiar, and part of the employees are already “recruited”.

Under certain conditions, this process can grow into a strong business. But it is not uncommon for an entrepreneur like this to become ‘king for a day’. Everything depends solely on them. If a former senior executive, willing to become a true entrepreneur, has identified an actual market need instead of using connections based on corrupt, or criminal schemes, it means that he or she has chosen the right path. However, a business keeps evolving only if, from the very beginning its future owner starts investing in self-education and personnel training, equipment, and developing business processes. Otherwise any decisions will prove useless.

At the same time, regards top managers, it is important to remember that when leading executives in a business want to leave and create their own company, there is a downside to it.

The resignation of a leading top manager is a heavy blow for an entrepreneur: it always happens at the worst time, there is never a proper substitute, and no way to keep the clients. Moreover, suppliers may not be guided by established good relations: “business is business – nothing personal”.

It immediately becomes evident that trust is good, but not too much trust: a full delegation of authority merely helped the manager’s treachery to emerge and to grow. The owner should have prepared a substitute, but was afraid the employee would be offended by the distrust; they should have checked more often, but were afraid to spoil the relationship with excessive suspicion – this is something that almost every entrepreneur goes through.

Top managers betray you, steal your ideas, copy your know-how, and take valuable materials or money. And there is no recipe to avoid such situations entirely; the only way to protect yourself is through a complex suite of solutions, namely: constant work with employees, a system of contracts, and inner monitoring of the problems in your own business. And this is by no means a complete list of preventive measures and precautions.

– Business case —

…At the age of seventeen, I took part-time jobs like most of my peers, Some did construction work, while others harvested crops or unloaded freight trains. I prepared mortar and brought it to a bricklayer: first one, then two, and in a week I was already helping three bricklayers at once. I wanted to earn some money and was strong enough.

And then I heard that a construction crew was being put together to work at a roofing plant in the city of Odessa. I signed up. On the very first day, I got bored at my work place: my only responsibility was to occasionally empty a bucket of white oily liquid called “kagalin” into a vessel through which the tape of the future roofing roll crept. I decided that I could simultaneously master another operation and soon started working two shifts in a row. Just a week later, I was able to perform fifteen operations at a conveyor belt 100—150 meters long.

A month passed. By then, apart from the two shifts, I spent several hours a day unloading train wagons loaded with roofing. For each type of work, I got a mark in my time-sheet. I was already counting how much I had earned. And then I went to get my paycheck, and saw that only part of the money was indicated in the account book. For three days the headsmen of the two shifts kept sending me to each other, until I finally gave up. I went to the train station, tired and disappointed. But I did have 200 rubles (out of the 450 that I had earned) in my pocket, so I decided to stop by the well-known “Privoz” market in Odessa and buy some presents for my family. And there I fell for a simple conman’s trick: a planted package (which at first glance contained enough money to buy a car), a scuffle, a fuss… 200 rubles covered in blood and given away in a sort of slumber, and the so-called “dummy” – a wad of paper with only two real bills in my hands. How angry I was at Odessa and its “Privoz”! And how grateful I was to it later, when I became an entrepreneur for showing me how crooked and unjust people could be, and letting me see that such incidents could never break me.

A lot of things in business are based on trust, and the stronger you get, the more trust you are going to need. This goes both for amounts of money and contract responsibilities: at times entrepreneurs give each other large sums of money without any warrant relying solely on their word.

Never try to push your way in business through cheating or manipulation. A reputation can be worked on for years and lost in a second!

As a rule, an entrepreneur is stronger than the majority of people surrounding him – those who are envious of his or her ability to run a business. Many of them dream about trying their hand at entrepreneurship. That is why is it so important to be as decent and civil as possible not just with your business colleagues, but with everyone around you.

– Business case —

…At the beginning of his entrepreneurial career, a colleague of mine (he is still a prominent businessman) asked me to do him an urgent favor: to lend him a set of leather seats for a tuned car that was produced at my shops. I did so, taking his word that he would pay me back.

When the time was up, instead of money he offered me a barter deal (an exchange of goods was common in the 90s) – a five-speed gear-box. Although I was clearly losing money, a bird in the hand is better etc, so I had to accept the offer. One of his employees brought the gear-box and we put it in the storehouse. After a while we installed it in one of our tuned cars. How disappointed we were to find out that all the gears inside the box were old and it was not even assembled correctly. I had been paid back with a “dummy” once again, but this time I knew who had done it and when. I approached my colleague with a request to exchange it, but received a flat refusal: “You should have checked at once.” But how could I have checked without installing it in a car? However, he was not going to listen to my reasoning.

Years passed by. That businessman deceived everyone around him and never gained respect. Today, he has the worst reputation among our city’s and region’s entrepreneurs. I am sure that in the end he will pay for having treated his business colleagues so unfairly.

If you belong to the “magical minority” of true entrepreneurs, be as polite as possible with those who depend on you, and the community will grow more tolerant towards you. We must treat others the way we want them to treat us.