Is Passion Enough?

When it comes right down to it, business owners fall into twocamps: People who follow their passions, and clear-eyed folks wholook for great moneymaking opportunities. Each side says itsapproach works best.

On one hand, following a market opportunity has glitteringallure: A great opportunity can make a lot of cash. On the otherhand, following your passion has romantic appeal: All day long,you're around a product or service you love.

But what are the downsides? Are people who follow their passionsmore likely to fail? There's no hard research to support thatclaim. While the steady stream of bankrupt restaurants, bed andbreakfasts, and golf companies does seem to suggest that thepassionate approach is weak on results, reality is far morecomplex.

Beating the Odds

Miles Cook looked like a failure statistic waiting to happen: a25-year-old guy who loved motorcycles and wanted his own motorcycledealership. At first glance, he seemed to be headed for disaster.Even the banks thought so. "I was young, and a lot of banksdidn't even want to talk to me," says Cook, now 32. Afterfive banks declined his application, Cook read anEntrepreneur article listing the top banks for smallbusinesses in each state. Sure enough, one of those banks agreed toloan him the money for his startup. Now Cook's RochesterMotorsports Inc. in Rochester, New Hampshire, does a briskbusiness selling the most popular brands of Japanese motorcycles,with nearly $10 million in annual sales.

"It all comes down to passion. Blind ambition is betterthan 20/20 indifference," says Cook. "If you'repassionate about what you do, the sky is the limit."

Business consultant Karyn Greenstreet agrees. "You have tofall in love with the product or service," she explains. Herwebsite, www.passionforbusiness.com, offers consulting andcoaching services for entrepreneurs.

However, by some reckonings, Cook was committing a big no-no bybeing so emotionally involved with his product. "The problemis, when you fall in love with a product or service, you tend tofocus on your product," says Terry Powell, CEO of The Entrepreneur'sSource, a Southbury, Connecticut, franchise consulting firm."You don't spend enough time managing, marketing andpromoting the business."

Passion and Opportunity

So why do folks like Cook succeed while scores of othermotorcycle-lovers lose their shirts? On closer examination, Cook,who worked on his MBA but never finished, had the golden mean: justthe right mix of passion and business acumen.

Cook didn't just love his product; he followed four focusedsteps to lay a good foundation. First, he worked his way throughcollege selling motorcycles at an independent shop and racked uphigh sales figures. Second, he called Honda to ask if there wereany dealer opening points in the area--there were. Third, Cook didhis own market research by poring through census data and seekingout county figures for affluent males aged 18 to 49. Fourth, hescouted out a location himself, he says, by "just talking topeople at city hall, driving around and looking."

Passion for Business

In contrast, Bill Anderson pegs himself as a guy following amarket opportunity rather than his passion. Anderson, 53, ownsthree The UPSStore locations in New Jersey and Pennsylvania. "Mybusiness plan from the get-go was to establish [an ongoing] concernrevolving around multiple units, where I would be the president andrun the store through staff," says Anderson. In business since1996, he says he's doing well, with his 12-employee franchisebusiness bringing in $1.2 million in sales annually.

On the surface, Anderson's approach may seem analytical anda bit cold-blooded, but that's not quite accurate. While hecertainly wasn't in love with the shipping business, he didunderstand it, having previously owned a health-care automationfirm where he gained shipping experience as a customer at storeslike The UPS Store. Anderson says there was a sort of passion inhis decision: "I had a passion to work for myself." Evennow, Anderson is energized by helping others achieve their dreamsof business ownership as chair of The UPS Store's franchiseeadvisory council. He also sits on the International FranchiseAssociation board.

So who has the better approach? Cook, the motorcycle lover, orAnderson, the clear-eyed shipping realist? In reality, experts saysuccess isn't about passion or market smarts. "You have tohave both," says Therese Flaherty, director of the WhartonSmall Business Development Center at the University ofPennsylvania. "Yes, your business absolutely must get youup in the morning and keep you enthusiastic. But you must pursueyour dream with the best tools you can get."

Emphasize Sales Growth

Julie Turner, who started out as a kindergarten teacher, knewshe couldn't spot a market opportunity--but she did loveworking with people. When she bought her Express PersonnelServices staffing franchise in 1995, she set about learning thebusiness model through the franchise's classes, and she hiredstaff to do the back-office work. Now, her Fort Worth, Texasfranchise boasts $13 million in revenues for 2004. She enjoys beingthe "face" of her business with clients and potentialclients. "I love being out, meeting people, helping peoplefind jobs. It gets in your blood," she says.

Turner, 35, says passionate types like her are one step aheadbecause their enthusiasm is contagious to customers and staff.Passion is hard to come by, she reasons, but expert businessanalysis can always be found for a fee. "Frankly, ifyou're not going to go out and sell, you don't haveanything to analyze," says Turner. "That's how I lookat it." Conversely, for analytical types who lack Turner'sgift of gab, she suggests you "hire your weakness" andget a good sales staff.

Turner's enthusiasm for meeting with potential clients jibeswith the first rule of business, according to Flaherty. "Thebiggest mistake is to not allocate time and attention to improvebusiness and look for new sales," Flaherty says. "If youdon't do that, you don't have a chance to put anything elsein place."

Follow Your Nose

Following a market opportunity was the rule for "skibum" Mark Curran, co-founder of Black RiverProduce in Proctorsville, Vermont. When he began the businessselling produce in the 1970s, neither he nor his business partner,Stephen Birge, knew anything about their product. Rather, theirpassion in life was skiing. However, neither wanted to make abusiness out of skiing--the vicissitudes of that industry seemedtoo daunting. Instead, they discovered that local households andrestaurants had problems finding fresh, high-quality produce. Sothe two went into business--making deals with nearby farmers andrenting an old barn and a Volkswagen bus. "We were looking fora business opportunity," says Curran, 50. "But once wedid [it], it was a passion for working for ourselves."

The first thing Curran and Birge learned was that their businessplan wasn't working. Originally, Black River Produce was aretail store selling produce and vitamins, while the wholesale sideof the business consisted of picking up some vegetables for localrestaurants. But as the wholesale end quickly outpaced the retailend, Black River switched gears. "You have to follow yournose," says Curran, summing up his philosophy of looking for amarket opportunity and pursuing it.

Black River Produce now has $31 million in revenues and a fleetof more than 30 trucks and 155 employees. Curran says BlackRiver's success helped him realize his dream of buying afarmhouse and raising his four children near his beloved skislopes. And he didn't mind the hard work, sometimes joiningfarmers in the fields to pick corn. "When Steve and I startedthe business, we went three years without a day off," Curransays. "But when you're working for yourself, you don'teven think about it."

Seek Advice

In any case--whether a business is based on passion or a marketopportunity--starting out with sound advice and a business plan isa must,
say business advisors. The process of writing and researching abusiness plan is useful even for a part-time startup, says LindaPinson, author of Anatomy of a Business Plan and co-authorof Steps to Small Business Start-Up.

That's because putting together a business plan teaches the"business of doing business." "It reveals to [theentrepreneurs] whether this is a viable business at all,"Pinson says. "It tells them what their financial opportunitiesare, whether the goals are realistic, when to changegears."

A greater tendency to plan and seek professional help is onemarket advantage opportunity-seekers have over their passion-drivencounterparts.

Layla Masri sees herself as a little of both: As a marketingprofessional, she was passionate about the burgeoning potential ofthe internet, but she also saw it as a huge business opportunity.And when she started her Alexandria, Virginia-based website designfirm, BeanCreative, in 1997, she sought an accountant and lawyer from thestart. Equipped with a business plan and structure, she stayed thecourse through lean times and growing pains. "For the firstone and a half years, I was trying to build Bean Creative whileworking full time," says Masri, 32. "It didn't giveme a whole lot of time to sleep or have a social life."

When a big client--National Geographic--finally came along, shetweaked her business plan and changed Bean Creative from apart-time LLC to an S corporation. Eventually, the company hadenough full-time work for her as president and her husband as vicepresident and head of design and programming. Bean Creative nowboasts $1 million in sales and seven employees. In 2003, Masribought her own building. The changes weren't so jarring, shesays, because her business plan had called for growth allalong.

"A business plan is not something you write [and] then putin a drawer somewhere," Pinson says. "A business plan isa lifetime guide for the small business. It's a guide youcontinually use and update."

Find the Pain

Wilson Alers, 47, has always worked in the audiovisual stagingbusiness--setting up stages and theat-rical lighting for corporatemeetings, product launches and celebrity promotions. He decided tostart his own business because his employer had so many unhappycustomers. Alers says he saw his employer "running thebusiness into the ground," failing to reinvest and making dowith patched-up equipment. "It was frustrating," saysAlers. "I wanted to do things right." So he startedMedia StageInc. in 1990 with just two employees. Now the Sunrise,Florida-based business has grown to 22 employees and $4 million inannual sales.

Like Cook and his motorcycles, Alers had more than just apassion for his service--he also had years of experience workingfor another company. While the decision to strike out on his ownwas done in the heat of the moment, in hindsight, Alers sayshe'd also found a great market opportunity. "At the time,we had just entered the Gulf War, and there was a downturn in thebusiness outlook." Already-dissatisfied clients looking tosave money were willing to risk their businesses on thestartup.

While he was just following his gut and was sick of dealing withdissatisfied customers, Alers was also acting on a business tenet:Find your customer's pain. "Find out what segment of themarket has a problem," says Pinson, "and find out how youcan help them."

Compensate

All in all, experts and entrepreneurs say passion--either for aproduct or for business--and following a market opportunity areboth crucial to the startup equation. Those whose strengths lie onone side need to shore up the other side, either through disciplineor hiring people to help them.

"It's the same way people muster up the discipline tochange a baby's diaper. You're going to do the dirty workbecause you love that business so much," Greenstreet says."It doesn't matter why you're going into business,whether it's because you love to be in business or because youlove what you're selling. What matters is [that] you have somelevel of passion."

Do it Right

Dos for market approach:

• Do consider franchising. Franchise consultants say peoplelooking for market opportunities are well-suited forfranchising.
• Do pay attention to the "feel" of your business; ifyou're more of a behind-the-scenes type, hire a sales forcethat presents the right image to customers.

Don'ts for market approach:

• Don't rely completely on market research. For instance, ifresearch shows a city doesn't have many pizza chains, it'snot necessarily an opportunity; there may be so many independentpizzerias that newcomers can't break into the market.
• Don't get caught up in a fad, which may fizzle beforeyou're off the ground.
• Don't become a workaholic; consultants say people who see agreat market opportunity should guard against working day and nightto satisfy the market's need.

Dos for passion approach:

• Do balance out gut instincts with market research. That vacantstorefront may strike you as a great location, or your product mayseem perfect, but do the research anyway.
• Do find employees or consultants with business acumen that youmay lack.
• Do take a disciplined approach to practical tasks such asbookkeeping and maintaining a business plan and business structure;experts say passionate types tend to procrastinate on routinetasks.

Don'ts for passion approach:

• Don't look to franchising if you want to do things yourway. Franchises are proven business models meant to be replicatedexactly.
• Don't focus so much on your product or service that youforget long-term planning.
• Don't try to go it alone; ask for advice early on.

JudithPotwora is an Atlanta-based freelance journalist specializingin business issues.