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What type of person makes a good entrepreneur?

I am currently a student at the Australian Graduate School of Entrepreneurship. It won't suprise you to know that we spent one semester studying Entrepreneurship and Innovation. One of the big questions of the seminar subject was the one I posed at the beginning of this post, as well as the related question "How can we tell if an entrepreneurial venture will be successful?"

I value the research that has been carried out in this area, but I wonder about the questions. How do you define success anyway? Even if we agree on what success is, can we really tell what made a venture successful and what characteristics of the entrepreneur made it so? In the popular press, we look at "successful" entrepreneurs like Richard Branson. How do we know that for every Richard Branson, there are a thousand people out there with exactly the same mindset, the same life experience, the same outloook on risk taking and venture formation who have eitther tried and failed or never tried at all.

All of that is to assume that you can take two people and say on these range of measures they are the same. Who is to know that the single most important measure is the one you left out. Of course just like no two people have the same fingerprint, no two people are exactly alike. So what's the point of trying to find what makes and entrepreneur?

I seriously considerr the possibility that it is all a mattter of luck. The right person in the right place at the right time with the right idea and with the right lucky breaks.

I was prompted to write by this piece [sorry can't login to afr.com to provide a link — It was the main Leadership piece in the May 3-9, 2007 issue] in BRW.

Kevin Hindle is commenting on the 2006 Global Entrepreneurship Monitor which, according to the article, found that

Australia is still very much a 'milk-bar economy': a nation of small business owners whose ambitions are limited.

James Womack goes on to say

You've got one guy, and the product concept is between his or her ears — no marketing system, no no supply base, no media, no apparatus, nothing. It is esier to do it right when you begin with than it is to rework it into right once you are a way along."

The article then suggests:

A common failing is neglecting to define the business's purpose. Womack says most managers say the purpose of the business is to make money, which is not an observation that leads to action.

The Spiral Path is dedicated to guiding people to think not so much what the purpose of the business is, but what their own purpose is in starting and running the business. These two are related but not the same.

Unless you've been asleep, hibernating, or out of the country for the last 12 months, you will be well aware that the Private Equity phenomenon has well and truly hit Australia.

I can't remember when it actually hit my radar, but the KKR bid for Coles [Updated 20/4/07] last year (ie 2006) was one of the first to come to my attention. I was certainly aware that KKR was part of the successful bid for Myer, but that didn't seem to be much cause for concern. Coles Myer hadn't known what to do with the iconic and once hugely successful Myer brand for a long time and its stores were floundering despite Dawn Robertson's best efforts. Count in that the consortium included the Myer Family and it all seemed like a good idea.

But then the separate semi hostile bid for Coles raised a lot of hackles in the community here. Coles was another iconic Australian brand grown from the battler success story of C.J. Coles — albeit suffering at the hands of the much more successful Woolworths. A lot of Australians just didn't like the idea of big money from the USA trampelling all over our heritage.

But the big one of course has been the APA bid for Qantas. There's nothing much more iconic than the Flying Kangaroo. Unlike Myer and Coles, Qantas is a succesful business. But Qantas represents more than an icon. It represents the working conditions of thousands of Australians and more than a million people in this country value (like me) our Qantas frequent flyer points. Now of course APA claims to be majority Australian owned and Australian controlled – it needs to be to satisfy the conditions of the Qantas sale act. However a significant amount of foreign money is involved in the bid and questions remain around the degree to which the act applies to Qantas' subsidiary Jestsar. What will happen to the working conditions of QANTAS and Jetsar employees. Will they all be moved to Australian Workplace Agreements, in the process losing hard won benefits? Will maintenance operations be moved overseas? And, for millions of Australians, what will happen to my frequent flyer points.

Notwithstanding that I think the last of these questions is really of much import, the others are of great concern to those involved and represent possible encroaching by example of the working conditions of millions of Australians.

However, to my mind, none of these is the most important concern. What bothers me most is whether the private equity partners in this deal (or any other for that matter) have any concern for what happens to their prey in the long term. Take Qantas as a case in point. APA cares for one thing and one thing only – the profit they can make from the deal. My concern is that APA will simply convert value into cash in its own pockets.

Now I might be wrong about this. Certainly the supporters of private equity argue that these arrangements enable owners to free themselves of the short-termism of public equity. They can be allowed to make losses, or at least not grow profit at the rate required by the market for extended periods. This, in our mind, is a good thing.

However, is this really what they will do?

I guess we will have to wait and see.

Julian Lippi's PhD thesis has been a rich source of reflection for me over the last few days.

Today, I was caused to think about mistakes I've made both in my professional career and in my personal relationships.

I was reading Jenny's story where she said:

... every professional mistake I've ever made in my life ... has been a failure to listen. I cannot think of any time ... I've got myself into hot water that couldn't be traced to a failure to engage with the other person's data for long enough, or at a deep enough level. Can't think of a time where it wasn't about listening. (p161)

This would be quite true for me as well, although I would add an important factor that comes into play for me. It might be the same as what Jenny is speeking about or it might be something different.

For me, I always relate my mistakes to my failure to engage with myselft. When I think about it afterwards, I realise that at some level I always knew what was going on. I knew what was going on, or at least I knew that something was wrong, but I suppressed that knowledge. More important than supressing the knowledge, I supressed what my feelings about or sense of what was happening. When I became uneasy, I would allow my natural optimism to overide the unease and used it as an excuse to not even allow my conscious mind to be aware of my unease.

In this way, my optimism is a defence against the conflict I fear would, and often would have, arisen if I had acted.

I regard myself, and most people who know me well regard me, as an insightful person. One colleague (who I would regard as a person with great insight herself) I worked with on a year long project remarked to me "You see things that others don't." In my heart of hearts, I fully believe this to be true. I don't like claiming it for myself because it sounds like I am boasting.

However, because of my fear of conflict, I have sometimes been stingy or mean with my with my insight. I have kept it to myself. In this way, I lose out on being acknowledged for what I bring to the situation and the other (or others) miss out on insight about themselves and how they might do things differently.

It has taken me a lot of personal work to know this about myself and to know when it is happening. It is still my greatest challenge. Each day and before each interaction, I need to prepare myself to be aware not only of what is going on around me but, more importantly, to be aware of what I am observing.