While hope is a central tenet of an entrepreneurial mindset, hope alone is a promise without guarantees. In this podcast from The Money Show on 702 & CapeTalk, Pavlo Phitidis puts forward his argument that you cannot rely on hope, you have to have a plan to get whatever it is you are hoping for.
You can’t become a business owner or a good entrepreneur unless you’re optimistic, and believe in your ability to deliver something better than it has been done before. It is baked into the psychology of business owners.
What Pavlo does find concerning, is the number of established, successful business owners, 20 to 30 years into their business, who are ‘hopeful’ that they will be able to sell their business in the near future. Yet statistically, 94.6% of businesses started, fail to sell. Hard work and hope alone, are not enough.
A good entrepreneur prepares for the worst and hopes for the best. And it is this preparation that makes the difference. Pavlo shared an example of a business that has gathered a highly qualified team of extremely specialised scientists. They are all mature, they all come with impressive value stacks – wisdom, connections, insights and foresights.
The have created a digestible piece of blockchain technology that stands to resolve many problems for many businesses. But they have pinned their hopes on one of the 4 giant multinational consulting clients to adopt their tech. They have been waiting 6 months for that multinational to make a decision on their business. In the meantime they have no revenue coming in and are running out of runway.
The problem is that they have pegged their hope on something outside of their control.
While we sometimes have to rely on others, and elements beyond our control, hope has to turn into a plan rather than just a wish. For example, they could have pitched their concept to 30 big multinationals but putting all of your hope in one external factor or entity is too risky.
You have to plan now, to sell your business when the time comes
Most business owners invest approximately 48 000 hours in building their business, and yet only 30 to 100 hours go into selling it. We hope there will be a buyer when we are ready to sell.
Often the business owners don’t even know what the business is objectively worth – they see the value in what it is worth to them, as they have lived through the business.
They need a plan that is actionable, measurable and achievable!