The schizophrenia of starting your own business

Starting your own business is a dream for many of us.  The prospect of being in charge and having to answer to no-one is very appealing.  Knowing that the profits of all your hard work is returning to your own pockets, sounds more than justified since you’re the one doing the work.

As I’m experiencing myself, creating a business has nothing to do with working independently and collecting the profits.  In his book ‘The E-Myth Revisited‘, Michael E. Gerber explains why this difference is the reason so many small businesses fail.

Most people start a business because they were good at some technical work like carpentering, programming or painting.  At some point in their career, they start thinking that their boss doesn’t recognize their attribution to the success of his business.  The thought of independence starts to surface, and from that point on there’s no return, so they start a business of their own.

There’s one major assumption though: “If you understand the technical work of a business, you understand a business that does technical work.”  Unfortunately, this is not the case.  Doing technical work and running a business are two totally different things.

On top of that, every person who goes into business is 3 people in 1:

  1. The Entrepreneur, who thrives on new ideas, change and lives on the edge of chaos.
  2. The Manager, who likes order, stability and predictability.
  3. The Technician, who loves to create the product and takes pride in his craft.

Michael describes the conflicts between these different characters, and how a founder is pushed towards all 3, whether he likes it or not.  A business is bound to fail if not all 3 are present, which starts to become a problem when success leads to growth.  At that point in time, the founder will discover his true passion.

Is he able to let go of the technical work and hire employees?  Can he let go and focus on managing his company and searching for new business opportunities?  If so, the company is likely to grow further and after a while, the combination of being an entrepreneur and a manager is also no longer workable.  So again a choice has to be made.  Will the founder invest in the company by focusing on the entrepreneurial role full-time?  Is he willing to delegate operational management to others?

A key message for me is that we have to pay equal attention to all 3 roles, right from the first day.

  • If the entrepreneur is missing, your business won’t grow and you’re basically doing a job with extra overhead you didn’t have when you were still working as an employee.
  • If the manager is missing, your business lacks structure and will turn into chaos as it gets bigger.
  • If the technician is missing, there’s no added value to sell and nobody will buy your products or services.

Should every founder turn into a full-time entrepreneur as his company grows over time?  Off course not!  Chose the role of your heart.  And if you do, make sure that others take care of the 2 remaining ones.

(picture by Anderson Mancini)

About Nick Oostvogels

Hi, I'm an independent management consultant. My biggest strengths are located in the fields of teamwork, motivation, leadership and continuous improvement. In the IT industry you find a lot of these values in the agile movement, in which I often act as a project leader, product owner or coach. My interests go a lot further, into other industries where we find these values in lean production. Besides that, I try to broaden my horizon as much as possible, always looking for better ways of doing business.

2 comments

  1. Pingback: Five Blogs – 11 Augustus 2012 « 5blogs

  2. Ben

    great post, couldn’t agree more

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