As necessary as risk is in starting up, it's possible to get too close to the line. Though his business is thriving, Wielgus still remembers the nights he spent awake staring at the bedroom ceiling, with visions of Chapter 11 dancing in his head. Likewise, Boettcher brought in investors early on and soon regretted the risk of including others in the business; he wrestled himself out of the situation, but it took more energy and money than he'd anticipated. Every entrepreneur has an individual limit, and it's important to know just where that is, whether in the personal or professional realm.
Laura Rembisz, 32, has a thriving IT contracting and placement business, RemTech Business Solutions Inc., in Farmington, Missouri. She took many risks starting up, including walking away from a good sales job, but there are still some risks she has trouble taking. "Since I started, there have been a lot of times when I wanted to grow and really expand, but I've held back because of fear of going too fast and making mistakes along the way," she says. "I hear so many stories about companies that might have grown too fast, so I've had to reel in my energy and make sure we're doing one thing at a time. Part of me wants the company to grow rapidly, but everything I've done I did in an educated way with the numbers in place, and that's the way I want to keep doing it."
Richard Chang, author of The Passion Plan: A Step-by-Step Guide to Discovering, Developing, and Living Your Passion (Jossey-Bass Pfeiffer, $25, www.thepassionplan.com), says there are other risks that entrepreneurs should avoid, such as going into business without a series of contingency plans and partnering with less-than-supportive compatriots. "One risk you should not take is to surround yourself with people who can hurt the business venture you're creating," says Chang. "Your drive can get depleted, and it can be very draining if you're around the wrong people. As you're growing a start-up, if you get people not tied in to that vision, you run the risk of having people sidetrack you. That includes hiring; if you're hiring the wrong kind of people who don't understand the track you're on, then the risk is that the people you're investing in are going to drain you."
Chang says that risk is personally defined, just like its limits. "A lot has to do with what your perspective is toward your venture," he says. "Risk is always there, but if you spend most of your time focusing on that, you might drive yourself into self-doubt or procrastination-you can be overcautious or lock yourself into not wanting to move forward. I don't think in terms of failure or risk-I try to think in terms of the happiness and success that can arise from risk."
What's Your Type?
Frank Farley, a psychologist at Temple University in Philadelphia, knew that there must be more to personalities than Type A and Type B, so he coined a new type: Type T. "These are the people who take risks because they're exciting-they're thrilling," he says. "All human progress depends on these people. If you see substantial progress being made, you'll see a Type T there. The essence of capitalism is risk. Entrepreneurship demands it." The "T" stands for thrill-seeking, and Farley says entrepreneurs fit the classification to, well, a "T." If you want to see how you stand in the alphabet game, he offers this checklist:
Type T personalities:
- Are motivated by variety, novelty and change.
- Thrive in uncertainty and unpredictability.
- Tend to adore intense experiences.
- Hate too much structure and too many rules.
- Have high energy levels.
- Believe that they control their fate and that destiny is in their hands.
- Tend to show independent judgment and like to make up their own minds.
- Are very curious about how much and what they can do.
- Eat challenges for breakfast.
- Often say they don't take any risks at all, even though others feel they take enormous risks.
Elizabeth Millard is a freelance writer who has never bungee-jumped but does try to eat challenges every morning as part of a healthy breakfast.