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Nadia Goodman is a freelance writer in Brooklyn, NY. She is a former editor at YouBeauty.com, where she wrote about the psychology of health and beauty. She earned a B.A. in English from Northwestern University and an M.A. in Clinical Psychology from Columbia University. Visit her website, nadiagoodman.com.
Launching a business is riddled with stressful uncertainties.
You worry about feeding your family, paying your employees, or
investing your own money without a guarantee of success. As an
entrepreneur, learning to manage that stress will make you a happier --
and more successful -- business leader.
Experienced entrepreneurs have a much easier time dealing with the
stress of uncertainty, in part because they think and act in ways that
virtually negate it.
"The expert entrepreneurs think in terms of control, not in terms of
uncertainty," says Saras Sarasvathy, associate professor at University
of Virginia’s Darden School of Business, who studies how entrepreneurs
cope with uncertainty.
Thinking in terms of control empowers you to focus on the actions you
can take to minimize risk. "Great entrepreneurs get very good at
shoring up the downside, but embrace products with uncertainty on the
upside," Sarasvathy says. That balance allows for both stability and
freedom.
Here's how great entrepreneurs achieve a sense of control:
1. Start by gathering stakeholders. Experienced
entrepreneurs don't act alone -- they take control by getting others on
board before they start a new project. They look for stakeholders in all
areas of the business -- potential employees, suppliers, investors, and
customers -- and ask them to make a small commitment to the project.
That buy in is essential. If experienced entrepreneurs can’t get a
couple stakeholders in each category, they kill the project. "They
almost define a great idea by whether they're able to bring enough
people together," Sarasvathy says. "If not, then your idea probably
isn’t that great."
2. Place small bets at the beginning. Lower your
stress and worry by starting with small investments -- things that
you're willing to lose if the company fails. Maybe you're willing to
work nights and weekends, or pay to create a prototype. "You still don’t
know if you'll win, but if you lose, you'll lose very little,"
Sarasvathy says. "You have control over the downside."
Approach your early stakeholders this way as well. Ask them to place
small bets that they would be willing to lose. For example, when Richard
Branson created Virgin Atlantic, he asked Boeing to loan him a used 747
for a few months to test the idea. If it worked, they'd have a new
customer; if it didn't, they lost very little. "Even a 747 is an
affordable loss for someone," Sarasvathy says.
3. Get early commitment from customers. As
experienced entrepreneurs often say, fail early and fail often. That
strategy lowers stress by giving you opportunities to improve your idea
before you have too much in the game, and the best way to do it is to
talk to your customers early. "Preselling an idea is the surest way you
can make the idea fail or succeed earlier," Sarasvathy says.
Pitch your idea and share rough prototypes as often as you can. You
have to be prepared -- even excited -- for others to critique your
product. If you keep it behind closed doors because you fear your
customers' response, you are doing yourself a disservice and adding
unnecessary stress.
4. Work within constraints. Having unlimited time
and money to start your company seems like a luxury, but it actually
adds a ton of stress and pressure. Working within constraints, such as
limited time or money, lowers your emotional investment without hurting
your passion or commitment.
Constraints also make you more creative. "People who start with a lot
of money can be much more likely to lose," Sarasvathy says, in part
because they have less impetus to innovate. For example, Pierre Omidyar
created eBay on nights and weekends, which forced him to create a more
ingenious system that would sustain itself with little central
management. His constraints kept stress levels low and made eBay the
success it is today.
Source: www.entrepreneur.com
