There is no single formula to finding entrepreneurial success, but rather many nuanced ways to achieve goals based on the location, industry and niche of the business. Some things like hard work, industry knowledge and taking risks are universal to the success of launching an app. Without the occasional calculated move into the unknown, no business would ever reach its full potential. After all, taking no risk is risky in itself – and can even prove potentially destructive.
Poker is an amazing training ground for understanding and calculating risk. There’s two elements that every poker player needs to take into account. The odds each hand has of winning and reading the person sitting across from you. Business decisions are no different.
So how can you take confident steps in new directions but still protect your business? Here are four ways that can get you safely out of your comfort zone while reenergizing and growing your business.
Don’t be afraid to fail
In poker, failure is inevitable. You can’t win every hand. The key is to minimize the risk associated with each move or by accepting the amount of your loss because the chances of a big win are so great. By understanding where your chip count is and your probability of winning the hand, poker players can accept the risk without the fear of losing everything.
As you recognized back when you first launched your business, risk is an inherent part of entrepreneurship. Before dismissing an opportunity attributed to your fear of failing, embrace the chance that you may fail. Also, keep in mind that calculated risks involve a series of known factors that give you the benefit of reasonably predicting success. Essentially, there are different levels of risk for you to consider but don’t just say “yes” to sure things.
Think of your competition
Planning the next move for your business is a lot like playing a game of Texas Hold’em poker. You must know the house edge, in this case your competition, so you’re able to better gauge when to bet on the future and how. Monitoring other businesses in your industry periodically through social media and industry news mediums can give you an idea of where they stack up against you. You can use this knowledge to create a better version of competing marketing, products, or services. You won’t be reinventing the wheel. You will just be making the wheel more remarkable, which is a lot less risky.
Plan for tomorrow, today
In poker, playing the person across from you is as important as playing the cards in your hand. Many poker players will strategically bluff or set fake “tells” during a game to set an opponent up for future moves.
Business is no different. All businesses have peaks and valleys to endure. Take advantage of today’s revenue high to map out your blueprint for tomorrow. Your planning should include expansion, marketing, employee recruitment and retention, and financial budgeting to account for seasonal lulls. The more prepared you are in these areas the less overwhelming risk will feel when you take that leap of faith.
Poker players hoard as many chips as possible to safeguard against unknown misfortunes. In business you not only want cash reserves, you want to have working capital available to borrow when the time arises.
Let’s face it. When it comes to borrowing money in traditional ways, small business owners are rarely successful. Per the 2016 Small Business American Dream Gap Report, only a mere 36% of entrepreneurs could secure bank loans, the rest were declined. With this substantial disadvantage in the world of lending, small business owners should and can look beyond traditional lending institutions for financing. These unconventional options include:
- crowd funding – raising money for a venture from the public via the internet
- angel investors – wealthy individuals granting capital in exchange for ownership
- social lending – groups or individuals borrowing or lending money directly to each other
- government grants – city, county, state or federal monies granted based on application criteria
All these are viable options that take more than just a credit score into consideration.
Having a little bit of fear is acceptable when considering moving your business forward. It’s what will help you from underestimating risk and making bad decisions. Be sure to be mindful of this fear, however, and balance out your emotion with