Do entrepreneurs have gambling in their DNA?

(originally published in Screen Magazine 3/28/12)

I’m always disappointed when I only have one team left in the Final Four of my March Madness pool. I don’t follow college basketball, I spent all of five minutes filling out my bracket, and I didn’t have any money riding on the outcome. So why am I disappointed? Can it be because I’m an entrepreneur? In my opinion, the desire to make good decisions is what fuels an entrepreneur. There are plenty of opportunities to make good decisions when you gamble, and even more when you own a business. So is being a gambler in an entrepreneur’s DNA?

I consider myself a casual gambler at best. I play poker with my buddies every once and a while, I’ll stop by the casino if I have time, and Las Vegas seems to be in my cards every 5 years or so. I also consider myself a casual entrepreneur. I’ve started a few businesses, invested in real estate, and don’t shy away from new venture conversations. If you think the risk associated with either scenario is not the same, think again. I’ll invest $150,000 of annual salary to a staff position if I feel it’s a safe bet that this person will be responsible for $750,000 in additional revenue. I’ll also double down my bet if dealt an eleven when playing blackjack.

What are the risks and what are the rewards? These are questions that business owners ask themselves daily. They’re also the same questions that gamblers (professional or novice) ask themselves constantly. So yes, I think there is a little gambler in every entrepreneur. So if you’re thinking about starting your own business and want to know if you have what it takes to be successful, stop by a casino and play a few hands of blackjack. The amount of money you risk is not important. Believe it or not, winning is not important. Being confident in your decision-making skills is important.  Confidence is what can make or break an entrepreneur.

Is it time to re-invent your business?

Is it time to re-invent your business?  I’m not talking about a major overhaul, but perhaps a little tinkering.  Can your business model be better?  Thomas Edison continued to upgrade his inventions well after their initial patents, why can’t you do the same?

Much has changed since you started your business, and I don’t even know when that was.  About ten years ago, a friend of mine suggested that it was necessary to re-invent your business every 5 years to stay competitive.  In the current climate, it might be beneficial to look at your business model from a different perspective every year.  Perhaps it’s time to take advantage of some new technology, bring on young creative talent, eliminate redundancies, or even develop a new logo and company personality.

Drawing inspiration from the latest round of DirectTV spots, let me finish with this… When a creative shop stops moving forward, it becomes complacent.  When it becomes complacent, it’s known for offering mediocre services.  When it’s known for offering mediocre services, clients will stop working with them.  When clients stop working with them, the business closes.  So re-invent often, and don’t ever stop moving forward.

It’s not too late to put together a 2012 budget

Budget.  Many creative individuals avoid using this word.  There is a fear that any financial discussions can lead to a premature death or even worse, a loss of all creative talents.  This is not true.  You will not be less creative if you look at a Profit & Loss statement.  You will be more informed.  “Let someone else worry about the numbers, I want to focus on my craft” a client once said to me.  He is not alone in that thinking.  Hell, It was six years before I explored the “Set-Up Budget” area in Quickbooks.

I’m not suggesting that you should become a CPA, fire your bookkeeper, and take on all accounting responsibilities yourself.  In fact, if you have the resources you should build a solid team of individuals that eat, sleep, and dream about maintaining your financial picture.  What I am suggesting however is to get to know your books enough so you can make informed decisions.

It’s not too late to put together a 2012 budget.  With two months of expenses in the books, this is not a bad time at all.  My annual budget was no more than a piece of string on my finger, a reminder of the goals I set out for myself.  Follow the same instincts that put you in a position to run a company, then use your budget to confirm those instincts are in line with your annual goals.

The Wild West

The creative industry has turned into the Wild West. If you want success you have to go out and claim it. Nothing will be handed to you. There is no map or trail that will guide us, so we have to draw up our own map.

You’re not going to hear me complain about it though, I’d rather think of a solution. Yes, post-houses are doing production, and production companies are getting into post. Sound design & music have become one. No experience is necessary to purchase Final Cut Pro or After Effects, and advertising agencies are doing all of the above in-house.

And I think it’s great, for everyone involved (especially the brand). But the key is… if you put yourself out there and offer services that you haven’t offered before, you better be good at it. You better be ready to perform at the level that everyone has come to expect. You better improve on the client relationship, and not just execute the boards. Because if you don’t, there is someone else out there that is ready and willing to earn your client’s trust.