Entrepreneurial Motivations and Resulting Outcomes

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Look anywhere today in the business world and you can see individuals pursuing their dreams and looking to provide a new product or service to the world.   We see it in technology, the food industry, transportation, and many other fields.  Why are these individuals deciding to take a step off the high dive and plunge right in, while some of us stay with what is comfortable?  What is it about becoming an entrepreneur that motivates them to dwell in the realm of possibility, while some of us dwell in dreams of retirement?

In Larry Alton’s The 5 Motivations that Drive People to Choose Entrepreneurship, he states those motivations are: money, flexibility, control, team and legacy. (Alton) It is not difficult to see why money would be one of the main motivations for becoming an entrepreneur.  The idea of being able to harness one’s talents to bring about change through products or services with the attachment of financial gain is attractive to many.  Also,  money may enable a person to have more freedom to pursue other ideas and/or use the profits to enhance his or her community.  Who among us has not been at work, daydreaming and thinking about being their own boss and having the flexibility to make their ideas “their passion”?

The flexibility to pursue that passion and create a life around non-work interests and family responsibility excites many.  As for control, how many times have you said to yourself “if I were in that position, I would do, I would have done, they should have done”?  The idea of controlling one’s destiny as well as the destiny of others and being able to be the decision maker is extremely rewarding to many individuals.

There is no better illustration than the coming NFL season to understand how important a team is to people.  Even if you are not a fan of football, you can understand from the continual coverage it receives on a daily basis for almost seven months how important these teams are to many people. But why?  Because we love our teams, whether they are NFL or Fantasy, and we do not have to be on the team to feel like we are part of the team.  Either one gives us an opportunity that has great rewards; for some it is financial and for others it is clearly bragging rights.

The last motivation is legacy, and I think we can all agree that leaving a mark on the world long after we are gone is extremely motivating to many individuals.  Think Steve Jobs — his legacy has profoundly changed the way we can communicate. We may not all be able to leave that kind of impact, but we certainly can leave an impact on the world we inhabit.

The question is– are all these motivations equal?  If a person is motivated by all of these to different degrees, how will that impact his or  her success?  In The Founder’s Dilemmas, Noam Wasserman’s research shows that wealth and control are the two biggest motivators for entrepreneurs. (Wasserman 14)   The problem with those two motivators is like the offense and defense in football — they both want to win, but have very different ways of getting to the win.  This may lead to constant friction.

Therefore, it is important for entrepreneurs to look deep within and see what is really motivating them. How will the motivations of wealth and control reveal themselves within the entrepreneur?  It is not just wealth and control, but the decisions behind those motivations and understanding what  the entrepreneurs want to accomplish with these decisions that will determine the success of the business.   Wasserman equates those motivated by wealth as having “Rich” outcomes and those motivated by control as having “King” outcomes. (Wasserman 13)   The “Rich” outcome is the person who is more interested in creating wealth and value than having control of every little decision. This person is willing to bring others in to help grow an organization and let them make some of the decisions. Oftentimes, this results in more wealth and less control.   The “King” outcome is the person who is interested more in control than creating wealth.  This person is likely to be involved in all the decisions and maintaining a tight control, and possibly not bringing in the necessary resources to grow the organization.  Oftentimes, this results in more control and less wealth.

So what does this mean to the person that says I am going to jump off the high dive and plunge right in?  It means some self-reflection is in order.  Before plunging in, it means take the time to know what you want to accomplish with your decisions. It means looking at what type of work place are you most comfortable in.  Do you need to make all the decisions?  Are you able to trust others with expertise so you can focus on the bigger picture? Is creating wealth more important than having control?  There are no right answers.  The right answer is different for each entrepreneur as we all come to the table with different work experience, goals, desires, families, and motivations.  The wrong answer is to not take the time to learn what one’s motivation is and the damage it could cause to one’s business in the long term.

Resources and Links:

Wasserman, Noam The Founder’s Dilemmas. New Jersey: Princeton UP,2012.

“The 3 Biggest Challenges of Being a Solo Founder.” Entrepreneur.com. 2015.

Web. 16 Apr. 2015

https://www.entrepreneur.com/article/245132

“The 5 Motivations that Drive People to Choose Entrepreneurship.”  Entrepreneur.com. 2015.

Web. 8 Aug. 2015

https://www.entrepreneur.com/article/249417

“Behavioral Determinants and Motivation.” Kauffman.org, 2016.

http://www.kauffman.org/microsites/state-of-the-field/topics/background-of-entrepreneurs/behavioral-determinants-and-motivation

“Entrepreneurial Characteristics and Motivation Factors of New Venture Owners: A Case

in the Food-service Industry.” Researchgate.net. 2014.

Web. Dec. 2014.

https://www.researchgate.net/publication/291336946_Entrepreneurial_Characteristics_and_Motivation_Factors_of_New_Venture_Owners_A_Case_in_the_Food-service_Industry

16 thoughts on “Entrepreneurial Motivations and Resulting Outcomes

  1. I think that the biggest thing missing in your blog is the love and passion in what you are doing. It is mentioned a little, but money and control are mentioned more. I personally think that to make a business work you need the passion and love for what you are doing. Money is great, but happiness is priceless.

  2. Hi Cece, excellent blog post. You really sourced your article well and laid out a compelling and easy to understand argument for paying attention to the “Rich” versus “King” scenario in business. This chapter, and your article, have really caused me to examine my motivations. Honestly, at first I always felt like I wanted to be King with my future business. But now that I think about it, I would rather be Rich – because it seems that my business will be able to thrive more as a result.

    Interesting stuff.

  3. Hi Cece. I liked that you incorporated the other motivations from Larry Alton’s writing. It added additional perspective on other areas to think of when starting your own business and what you are really trying to accomplish. You also mentioned how wealth and control can lead to constant friction because they both want to win. I think this could be the beginning of an entrepreneurs down fall if this conflict caused bad decision making on the owners’ part. This is a great post on knowing what to know and understand before jumping in with both feet.

  4. When we look at the five motivations (money, flexibility, control, team and legacy), money ranks number one because it is the vehicle for all the rest. We are so programmed to work to make it to retirement. But we (universal) were not programmed to gain wealth to live a life that affords retirement before we are to old to enjoy it. Because of the make as much money as you can so you can retire comfortably, we live somewhat uncomfortable. by that I mean we give up some of the more valuable possessions like time, family and being able to enjoy the journey.

    When flexibilities are created, do we fill them with recreation or more work? I had to realize that just because there was an empty appointment time on my calendar between appointments, doesn’t mean that I need to insert another something to do. The task list can be a heavy burden without balance.

    When I was in control, I felt that I needed to do more to stay in control. But shouldn’t it get easier by empowering others on the team? Teams mean that we have to trust, which equates to the right team members or partners. When people are valued they in turn are loyal not just to the one in charge but to the vision.

    If we were concerned about legacy, we would have more entrepreneurs; more creative ideas that become reality; greater fulfillment in life for us and out children. The children could walk into that legacy with ease or have the encouragement to walk out on their own dream because it was the norm in their house.

  5. Great post Cece! After reading your post I am realizing that losing control does not only mean maximizing wealth but it also could mean having more time for your own life. Time is the most important thing and how we use it. Wealth could also mean time. If you give up control for others to run your business then you could have the freedom of flexibility. Being Rich could obtain the most desired things of being wealthy, having flexibility and time. That seems like the ultimate goal. I thought most entrepreneurs would prefer to keep control of their own creations but now that I see this perspective that being Rich would also create time and flexibility for your life, that might be more desirable.

  6. Cece,

    Thank you for the thoughtful post. You really took this blog post to the next level!

    I particularly appreciate your thoughts on the control-focused motivation. As I put myself in the shoes of a first-time entrepreneur, I can imagine that this is often the tendency. If you have a new idea for a service or product and you are investing your heart, soul, and life savings to bring it to reality it makes sense that you would likely have a strong desire to maintain a sense of control over your own destiny. I can imagine that serial entrepreneurs get better about sharing control with their second and third ventures. This is the value of Wasserman’s book for first-time founders that they can learn from the experiences of others.

    Jeremiah

  7. The additional references that you used throughout this post were spot on and your personality is definitely felt.
    Personal motivations play a crucial role in the decision making process of entrepreneurs. Thanks for connecting this post to great relevance.

  8. Do you struggle with motivation? I know that I sure do! It was great to read about motivation through the eyes of an entrepreneur. Evenly highly motivated people can struggle sometimes to remain focused when the road becomes rough.

    Chris

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