Taking risks

5 Iconic Entrepreneurs and Their Business Gambles That Paid Off

5 Iconic Entrepreneurs and Their Business Gambles That Paid Off
Image credit: Jeff Kubina | Flickr
Reader Resource

Position yourself for growth in 2017—join us live at the Entrepreneur 360.
Flash Sale—save up to $200 on registration. Ends Thursday. Secure Your Seat »

It’s impossible to be an entrepreneur without accepting some risk. In fact, it’s usually the businessmen and women who are willing to take large risks that enjoy the highest rewards.

Although every situation is unique, it is instructive to study past success stories as a way of motivating and encouraging aspiring entrepreneurs to take a chance.

Related: 3 Ways Companies Can Encourage Smart Risk Taking

The value of risk taking.

There’s a clear difference between taking a calculated risk and making a foolish choice. However, as you’ll see in the tales of the entrepreneurs below, both can succeed and sometimes do.

Your objective when taking a risk, though, is to pursue something that you believe in. The essential lesson is that it can be very hard to be successful without accepting a certain level of risk.

It’s the pursuit of the unknown -- the gamble, the high-risk, high-reward decision -- that shows who you are and what you are capable of. For a better understanding of risk in the corporate arena and how it can pay off for people who are willing to take a gamble, take a look at the following savvy -- and possibly lucky -- entrepreneurs.

Gambles that paid off.

Think about what can you learn from the following entrepreneurs…

Elon Musk. Successful entrepreneur Elon Musk has managed to lead one company to accomplish what no other American firm has been able to do in the past 50 and more years: build a new, promising car company. While that in itself is pretty noteworthy, how he did it is an even bigger story. 

In 2008, with the U.S. economy at its very lowest, Tesla felt the financial strain that many companies across the nation were experiencing. Unable to deliver its first car and at severe risk of losing everything it had built, Musk leaned forward and took a risk.

He stepped up and “doubled down” on Tesla by investing his last $35 million in cash. The gutsy move paid off: Tesla is now worth $2.5 billion. The company continues to push ahead by taking calculated risks through private loans and stock management.

Related: Elon Musk Wants to Colonize Mars in Order to Fend Off Human Extinction

Fred Smith. While the word “gamble” is often used interchangeably with risk, this isn’t always using it in its truest sense. For FedEx CEO Fred Smith, however, the word gamble is quite appropriate.

With his company struggling to hang on and in desperate need of a loan to cover fuel expenses, Smith made a list-ditch effort and gambled the company’s remaining $5,000 on a game of blackjack in Las Vegas. Was it luck, skill, or intuition? Whatever it was, Smith headed home from that weekend with $32,000 in his pocket.

John Mackey and Renee Lawson Hardy. In 2014, natural food stores have become quite popular. From small local chains to larger corporations like Trader Joe’s, shopping centers are filled with organic, local food companies.

However, not so long ago things weren’t that way. In the late 1970s, the demand for locally grown, organic, healthy food was virtually nonexistent outside of specific niches. That’s what made John Mackey and Renee Lawson Hardy’s decision to leave their popular grocery stores so risky. What could have been a major flop became Whole Foods Market, the now ultra-successful natural food store chain.

Related: Transparency: How Whole Foods Is Doing It Right (And You Can, Too)

Blake Mycoskie. Looking back, it’s easy to see why TOMS is such a successful company. It involves more than buying a pair of shoes; it makes you feel good about helping other people.

Mycoskie realized this before anyone else, and launched a business model that others called crazy at the time. He believed that by giving up some of his profits and passing the money to people in need, he might actually increase sales and offset the lost profits. While naysayers predicted imminent failure, Mycoskie has gotten the last laugh. His company is worth millions and has already expanded into other product lines.

Hockey great Wayne Gretzky once said, “You miss 100 percent of the shots you don’t take.” While that simplistic statement is true, there’s much more involved in taking a business risk.

It’s not about winding up and doing something stupid; it’s about finding something you believe in and doing whatever it takes to get there. From Musk and Smith to Mackey, Hardy, and Mycoskie, it should be evident that risk can involve a number of different guises.

For some, it’s pouring money into a company you believe in, and for others, it’s literally gambling your company’s savings in Vegas. According to Igor Salindrija, CEO of AskGamblers.com, and who knows a thing or two about taking risks, “Whatever form it takes, risk is necessary for success. Regardless of how much business acumen or financial backing you have, doing something successful requires a willingness to take a chance.”

While much of your willingness to take risk may depend on your personality, it’s vital not to let fear get the better of you. There are potential negatives and downsides to every decision, but the key is to look beyond those possibilities and pursue what you believe in.

Related: Entrepreneurs Risk All On 'Gold Rush Alaska.' Would You?