Which One of the Three Motivations of Entrepreneurship Are You?

There’s a different kind of entrepreneur inside us all. Janice B. Gordon helps figure out the different archetypes.

 

Entrepreneurs place a high value on creativity and will take a calculated risk if they can influence the outcome in their favour. The defined characteristics of an entrepreneur are someone who sees, explores, and develops opportunities for a clearly defined need, learning as they establish and grow with the resilience and persistence to drive through their ambitions. This is a good definition of entrepreneurship, however, it is important to understand what motivates an entrepreneur into entrepreneurship.

 

Hongwei Xu, who undertook a study of over 60,000 individuals at Stanford University stated motivators common to all entrepreneurs. “Non-pecuniary motivations are more important than monetary motivations for people to start a new business. One is autonomy: People want to be their own boss. The other is identity fulfilment, which is more about people having a vision about a product or a service.”

 

There are three primary motivators – serial, social, and lifestyle.

  1. The Serial Entrepreneur – starts a business for financial reward (wealth). Warren Buffet, Larry Ellison, and Amancio Ortega are examples of serial entrepreneurs interested in profit and capital growth, creating companies to grow and to sell. These men are part of the top 1% of the world’s wealth and have achieved their standing as self-made entrepreneurs in pursuit of the challenge.
  2. The Social Entrepreneur – creates a structure to help other people (contribute), this entrepreneur has a sense of social conscience. Money is not their primary goal; it is a function of the business ambitions. Social entrepreneurs have a desire to leave the world a better place by contributing innovations that improve society and in the process leave a significant legacy.
  3. The Lifestyle Entrepreneur – has a passion or skill that drives them into business. They are intrinsically motivated to do what they do, lifestyle entrepreneurs are thrilled by making money, it is extremely liberating to them. Growing a business and developing customer relationships is to further their passion, this may embrace lifestyle preferences or family commitments (freedom).

 

A quick straw poll on social media asking entrepreneurs what was their motivation for going into business, approximately 60% said passion/lifestyle, 35% answered social good, and only 5% stated financial reward. I have a hunch that if you were to do a scientific survey the results would be much the same.

 

The world of business is moving away for financial motivation towards moral motivation. I can guarantee that Bill Gates will not be remembered for the impact that Microsoft had on the world, as much as he will be remembered for his contribution (legacy) through the work of the Bill & Melinda Gates Foundation.

 

Although it is evident entrepreneurs think about their motivation for starting a business, it is my experience that many do not equate their motivation to the enterprise strategy. Richard Branson said: “It is important to understand what your primary motivation is so that you can focus your efforts on reaching those goals.”

 

As a business consultant and mentor, I meet entrepreneurs that want to help others and then get frustrated when they are not making enough money to achieve their business objective. This is not to say you cannot do both, but the lack of apparent primary motivation the social motivation can undermine the lifestyle motivation and the business struggles. You may have more than one motivation, however you can have only one primary motivation to drive the company forward, the motivated purpose.

 

Which one of the above three motivations drives you the most?

Entrepreneurs can sabotage their progress by not being clear and committed to their motivated purpose. Businesses that suffer from a misalignment of motivated purpose and business strategy portray the following symptoms:

  • For-profit companies that adopt an approach that functions as a not-for-profit.
  • Employee-centred HR policies rather than customer-centred practices.
  • Mixed messages to their employees, customers and stakeholders.
  • Have a stated mission that is not precisely aligned to a business strategy and action plans.

 

TOMS is a great example of a primary motivation of a social entrepreneur aligned to the clearly stated business motivated purpose and strategic goals through to its operational actions. This is all clearly communicated and attracts the employees, their customers and their stakeholders or fans.

 

Before you dive into the world of entrepreneurship or review your strategic plans, think carefully about your motivations for entrepreneurship; you will find yourself more satisfied in the long run if your entrepreneurial motivations are aligned with your motivated business purpose.

 

There is no perfect model of entrepreneurship. What is common to all entrepreneurs is that they have resilience and persistence to drive their ambitions motivated by autonomy and a sense of freedom. However, it must be evident that your primary motivation is driving the business forward.

 

About Janice B Gordon:

Janice B Gordon has won many awards for entrepreneurship, leadership and business growth consultancy. She is the author of Business Evolution, Creating Growth in a Rapidly Changing World endorsed by Lara Morgan and gaining much attention since its release in April 2014. Janice, known as a The Problem Solver is a Visiting Fellow for Cranfield School of Management. She has over 25 years’ experience gained working with blue chip organisations, starting, running and growing her businesses and advising small/medium businesses. Janice develops and delivers bespoke key account management programmes and customer relationships strategies for global organisations like Cambridge University Press and SMEs. Janice’s engagement has generated $9million+ sales in the last 12 months.

 

 

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