What makes someone an exemplary entrepreneur?
A WHILE AGO I took part in a ‘Question Time’ event at a Scottish high school, and was identified on the panel as an entrepreneur. One of the pupils had a question targeted specifically at me; she asked: “at a time of recession is it morally acceptable to be an entrepreneur?” She clearly didn’t understand the role of the entrepreneur in our Society, which is to create new companies, employ people in good jobs, and bring revenue into the Scottish economy.
I replied that a time of recession was exactly the right time to create new businesses, and entrepreneurs were pretty upstanding folks and not, as she seemed to somehow imagine, involved in dodgy practices.
There is clearly a problem in understanding what makes a good example of an entrepreneur in Britain today, and it’s not only this Scottish schoolgirl that has this problem. From their recent strange decisions, the Prime Minister and the Secretary of State for Work and Pensions also seems to have difficulty in recognising one.
Over the last 30 years, I have been involved in over 50 start-up companies and I think I have developed a pretty good idea of what makes a good entrepreneur. A good entrepreneur throws all their efforts behind their start up enterprise and their personal success is completely tied to it.
If their enterprise does really well then they can become really wealthy - and they will have earned every penny. On the other hand if the business doesn’t succeed, then the entrepreneur doesn’t make money – in fact they might also have personally guaranteed a bank loan and actually lose personal wealth. It is really not appropriate for an entrepreneur to lose their investors money in a failed company while somehow becoming personally wealthy.
A good entrepreneur doesn’t adopt complex tax avoidance schemes designed to ensure that remuneration payments escape normal tax and national insurance liability. It is the company, and not the employees, that are liable for any underpaid tax and NI, and so such actions put their company at considerable risk.
A good entrepreneur treats their staff fairly, including staff who get pregnant and need to take maternity leave.
A good entrepreneur always conducts themselves within the law; they wouldn’t cause criminal damage to a vehicle because they have a personal dispute with it’s owner.
If an entrepreneur has a talent for publicity, they will use it for the benefit of their business, and not for themselves. Richard Branson has never been reluctant to perform a publicity stunt to help the visibility of his business, but in doing so he is always promoting the Virgin brand, and Virgin products, and not his own personal profile.
Most good entrepreneurs will willingly help other entrepreneurs with help and advice, and will usually do that for free.
A successful entrepreneur is somebody who has created a successful enterprise. This is not a matter of opinion – it is a matter of fact – and if you haven’t actually created a successful enterprise you are not yet a successful entrepreneur. You may claim that you created a business worth £100m, but it is only worth that if somebody external to the company values it at that level.
At least I thought that was the case – until I observed recent appointments made by the UK government to encourage entrepreneurship from ‘deprived areas’.
It seems a shame to risk confirming the prejudices of my Scottish schoolgirl when there are so many really good entrepreneurs who could have been chosen.