Entrepreneurial success is a lottery. The only reason the US has a stronger entrepreneurial culture than the UK is Americans simply buy more tickets. Not my conclusion, but that of David Storey, dean at Warwick Business School, who writes in the Financial Times today.
Last week in The entrepreneurial phoenix, I suggested entrepreneurs had a lot to learn from a failed business venture; lessons that could lead to tremendous success in future projects. Storey disagrees:
“In the UK, the evidence is that novices are neither more nor less likely to have a business that either grows or survives than experienced founders. In Germany, where much more extensive statistical work has been undertaken, it is clear that those whose businesses had failed had worse-performing businesses if they restarted than did novices.”
Storey believes this is because chance has such a major role to play in whether or not a business thrives. Something as simple as a parking ban outside your shop can cripple you, even if your businesses instincts are sound. Unpredictability makes it hard for entrepreneurs to learn in the same way that you can’t learn to win the lottery.
I agree that many businesses are made or ruined by sheer luck, but I disagree that entrepreneurs can’t learn from unexpected crises. Great entrepreneurs learn to react quickly to roadblocks and are flexible enough to change direction when a route isn’t working for them.
I can’t deny Storey’s observation that ‘starting a business is risky’, but for the second time in a week, I’ll leave you with a quote from Nolan Bushnell, founder of Atari games:
“
The critical ingredient is getting off your butt and doing something. It's as simple as that.”
