Getting Started: Preparing for the world of entrepreneurial adventure (Rejection)

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Published by CPA Canada in CareerVision

Chances are, health you’ve had some real success in your life thus far.  Perhaps, decease you’ve graduated with a business degree, obtained a professional designation, won a job or two, and maybe even received some awards or honours along the way.  Although you might have experienced some disappointments, they tend to pale in comparison to the accomplishments that are well worth celebrating.

As you progress in your career, the odds are that you might experience a setback or two unlike anything you’ve encountered thus far.  As the stakes get higher, the likelihood of success can get proportionately smaller, and what keeps us trying is the realization that the potential rewards are often greater.  Having said that, in the corporate world, jobs can be like buses, with another one coming along at any moment.  If you miss the first one, sit tight, as another opportunity isn’t far away.  There is a certain kind of comfort in this.

Working with a start up company can be quite different in this regard, and it’s important to understand the implications if you’re considering making the switch from a corporate job.  In this series, our focus is on understanding the significant differences between a startup environment and the corporate world so that you can put a greater emphasis on developing some of the skills that will serve you well in advance of when they’re actually needed.   So far, we’ve considered the implications of risk, the ever expanding job description, and money.  Let’s talk about rejection.

Why it Matters

If you’ve met someone who works with a startup company, they can probably tell you lots about the upside; the excitement, thrill of doing something new, and the opportunity to “chart your own course” (they will soon learn otherwise!).  What they probably don’t talk much about are the odds of getting to the point of real success, which can be startlingly bleak.

With an abundance of new ventures launching wherever you look, the reality is they are challenged to find the necessary resources, customers, and capital to be successful.  In a world where demand far exceeds supply, many upstarts don’t last very long.  This reality is particularly true in the case of seeking the necessary capital to expand products, market effectively, and support growth.  Many entrepreneurs consider this to be the easy part, as who wouldn’t want to support their venture?  As the months go by, it becomes clear that just getting an investor meeting is difficult, much less making a pitch and getting funded.

In reality, the odds are stacked against startup companies.  Chances are that your venture will be rejected again and again; by potential customers, investors, and partners.  Those that work with startup companies, regardless of their level of success in life thus far, are likely to face rejection in a way that they never have before.  This can be disheartening, as well as quite a shock to the system.

Get Started

Although no one likes to spend time thinking about the downside, doing so is a good way to strategize to get to a better place.  This includes planning to face rejection and how to rise above it:

  • Develop sound problem solving skills: Those who find resilience in difficult times tend to have an ability to think creatively and solve problems.  As simple as it sounds, many people just aren’t very resourceful and lack the ability to determine what to do next.  Practice problem solving by approaching situations with a Plan B, Plan C, and even a Plan D.  Make it a “game” for yourself to strategize how you might get over hurdles, even in situations where they don’t actually occur.
  • Adopt a flexible mindset: Those who last the longest during difficult times perhaps have the greatest ability to be flexible, in terms of adapting to circumstances that are different than what was expected.  If funding isn’t received when anticipated, or turns out to be less than planned, surviving the setback can be all about how flexible a company can be.
  • Learn about early stage financing: Since financing is so integral to success and so elusive at the start up stage, it’s an important area to learn about, sooner rather than later.  Understanding how this niche area works and what investors look for can help you to be better prepared to respond to challenging situations.
  • Have an outlet for countering setbacks: Rejection and setbacks are stressful, and having a coping mechanism for challenges that are unlike anything previously experienced is important in order to keep going.  Find what works for you, be it creative interests, sports, exercise, or meditation and practice on a regular basis.  The startup world is truly a marathon and it’s important to develop longevity.

Preparation won’t end rejection, but it might help to make it less frequent.  It will also put you in a better position to withstand the many setbacks that will come and find the ingenuity and wherewithal to keep going.  The entrepreneurial world isn’t like where you’ve been.  You’ve got to train for it.

Getting Started: Preparing for the world of entrepreneurial adventure (Risk Management)

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Published by CPA Canada in CareerVision

So, see you want to work at a start up, cialis or maybe, with that young company that looks like it’s going finally to raise some investment capital.  What could be more exciting than that?  Or, you might be at a place in your career where we’ve all been: one of seeking out new opportunities and fields where the grass is greener.  But, before you leave that corporate job, there are a few things you might consider, because, well, how to put it?  Working for a start up is different.  Is that bad?  You ask.  Or, is that good?  You wonder.  Well, the reality is, it could be both, but really, it’s just different from the world of larger, more established organizations.

Although working with a start up or young (what investors often refer to as “early stage”) company can be an exciting place to be, it’s important to consider some of the other aspects of the opportunity fully before making the switch.  Those who haven’t spent much time around the start up world might be surprised to find out what the flip side of opportunity looks like.  In this series, we will consider exactly that, so you can make an informed choice, and perhaps, benefit from placing a greater emphasis on developing some of the skills that will serve you well, in advance of when they’re actually needed.

Let’s start with the issue of risk.  Although risk, in general terms, can be one of those theoretical areas, when working with a young company, its existence is not only evident, it’s very much real.

Why it Matters

Start up companies, or those in the early stage of development, are usually not short of ideas, enthusiasm, and ingenuity.  Their world is often one that is emerging, including new technologies, new ways of doing things, and new markets.  The reality is, that although start ups can sometimes lead to success, they more often than not lead to failure (or, more gently put, a learning experience).  This might sound like an obvious statement, however, many who are involved in the start up world become so focused on the opportunity that the downside doesn’t matter much.  In reality, however, it is always there.  A lack of experience (or attention) can result in not seeing the downside for what it really is, including the risk that is associated with it.

Get Started

One of the things about risk is that the greater you understand it, the greater the opportunity to overcome it.  Too many entrepreneurs fail or refuse to acknowledge its existence, resulting in circumstances that too often cannot be overcome (and leaving many wishing they could turn back the clock).  In addition, the stresses of living in a risky world, day in, day out, can be too much to bear.

Get started on the right foot by putting risk in its place from the beginning:

  • Seek out risk management opportunities: Risk management is a learned skill, so if you’re currently working with a large or well established organization, it can be a good opportunity to learn how to identify and manage risk.  This represents valuable knowledge to address risk in future roles, and your start up partners will thank you for it.
  • Conduct an honest assessment: Since working with a young company could (and often does) mean uncertainty in a number of areas, ask yourself honestly if this is an environment that fits well with your lifestyle.  Can you adapt to an uncertain income stream?  Does moving away from a stable environment create feelings of discomfort?  What will you do if the business isn’t successful?  Ask the tough questions now and be mindful of both your logical and emotional perspectives.
  • Plan for the unexpected: In advance of moving into an environment of higher uncertainty, take advantage of where certainty does exist.  Saving, completing professional development programs, and seeking out learning opportunities all can be done well in a stable environment and can be something to lean on in leaner times.
  • Balance risk and reward: Although it’s true that young companies can be risky places, they can also have rewards, including new experiences, an opportunity to contribute significantly, and commercial success.  You might even also get the chance to own part of the company to share in future financial performance.   The key point is that risk and reward should be considered in balance, as seeing a situation only for its rewards can lead to trouble.

There might come a time when a start up opportunity presents itself and must be quickly pursued, regardless of your state of readiness.  Based on the inherently risky nature of early stage companies, this can be a mistake.  Rather than becoming frustrated with the situation, why not get started to plan for becoming well equipped to make the leap to playing a key role in a young company?  If this one isn’t right, you’ll be better positioned when the next one comes around.

The Executive Edge (Risk Management)

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Published by CPA Canada in CareerVision

As your career progresses, diagnosis a funny thing can happen: you actually start to realize just how complicated the business world and your role can be.  Long gone are the early career refrains of “how hard could it be?” or “why not?”; experience has taught you just how hard things and all of the trouble that arises when the task at hand and the actions that were taken to address it should have been contemplated much more thoroughly.  Does it seem like the reverse should be true?  Call it “experience”.

Experience recognizes the full magnitude and complexity of situations and the actions that should be taken, as well as the various options that should be considered when making a decision.  Those who have successfully reached the executive level know that business situations are rarely black and white, and in fact, lots of grey areas exist; this is often the culprit of complexity.  As a result, experienced executives typically have a strong ability to identify complex situations and bring the right balance of analysis and action to bear.  This is what experience can do, in terms of developing the necessary level of judgment to recognize business risk (that can be mitigated), as compared to catastrophic risk (that can be devastating to a company).

In this series, we have already considered the importance of a number of Executive Edge skills, including professional development, consistent reliability, and high role engagement.  Here’s more about the importance of sound risk management skills to the executive ranks.

Where it Goes Wrong

Inexperience is often coupled with high enthusiasm and impatience; to get the job done, be recognized, and perhaps make a “splash” to generate a promotion opportunity.  Although there can be positive aspects to bringing action and enthusiasm to a role, there is a fine line between a “just do it” attitude and barging ahead in a careless manner.  Too often, less experienced staff members approach tasks without fully appreciating the challenges of the situation or the outcome of their actions.  Fast forward, and you might just find yourself in a situation that you wish you could have avoided or approached differently.  By this point, it’s often too late to turn back the proverbial clock, resulting in possible damage to the company, your reputation, and perhaps others.

Get the Executive Edge

Recognize that business situations are often much more complex and risk laden than most might realize.  Experience provides the tools to recognize this, but also the skills to indentify options for resolution.  Here’s how:

  • Seek to fully understand situations before acting. Taking quick action without fully appreciating the situation is a likely path to trouble. The devil is, in fact, in the details, so take the time and effort to be in the know.
  • Identify the key things you need to know. When analyzing business situations, there are typically a number of important areas to understand: What is the situation? Who is involved/impacted? What are the limitations/guidelines that are applicable? What are the financial considerations? What is the timeline for resolution? Develop a list of the standard things you need to understand and use it as a guide for resolution.
  • Consider the outcomes fully. It’s important to understand the situation, but also the outcomes of the actions that could be taken.  This is an area that often doesn’t get as much attention as it should, resulting in the right solution, but the wrong approach.  Remember that executives often spend more time “thinking” and less time “doing”, so don’t rush to judgment.
  • Be patient. Senior level decision making often requires more thought and patience than new executives might expect.  In simple terms, executive level problems are more complex, can impact more people, and have greater consequences: all good reasons to gather information, think it through, and take a patient approach.
  • Get advice. Bring advisors and other experienced individuals into the process when needed.  Although an executive might understand their business and customers well, they may lack specialized knowledge in areas such as legal, tax, and regulatory, so advisors in these areas can fill important information gaps.  In addition, a sound second opinion from an experienced executive can be extremely helpful.

Executives who are able to weather the storms of the business world for the long term need to have sound risk management skills.  Failing to do so could result in unsuccessful ventures or a short-lived executive career; costs that are much too high not to prevent.