Risk Taking in Business Opportunitites

23 01 2010

This week’s topic is risk taking in business opportunities.  This should not be as scary a topic as it may sound.  Anything you do that you haven’t done before is risk taking.  Starting a new business opportunity is definitely taking a risk, but there are ways to mitigate these risks. 

“Taking a new step, uttering a new word, is what people fear most.” – Fyodor Dostoevsky

As we have discussed before, risk taking is necessary in life, but there must be ways to control or manage these risks.  Once you find a business opportunity you are interested in, you need to evaluate that particular opportunity before fully commiting to it.  The evaluation should include how much information can you obtain regarding the proposed opportunity.  Before getting involved in a new business, you should strive to gather as much information about that business as you can.  Ask your colleagues, ask other experts in the field that you are researching and lastly ask your friends and family.

You don’t want to necessarily depend on your family to guide you in the right direction, or support your decision to start a new business.  It is good to get their advice, but keep in mind that they may be very risk averse and be afraid of any type of failure.  To overcome that type of fear, you need to gather as much knowledge as you reasonably can.  Once you have gathered enough information you are in a better position to evaluate the risk.  What is the best that could happen if you get involved?  What is the worst that could happen?  And lastly, what do you think will happen? 

There is a lot of fear when starting up a new business also.  This could be due to fear of failure and fear of embarrassment in front of the people you really care about.  Again, if you have done your homework on the business opportunity, you will have determined somewhat the risk of failure of the particular business venture.  If you never overcome the fear of failure, it is most likely that you are currently doing nothing more than the sheer basic job and are being paid appropriately.  If you want to grow and succeed, you need to take some risks and overcome your fear of failure.  By being afraid to fail, you will never go out on a limb and find out that you can succeed. 

If you do fail at a particular opportunity, that does not mean to stop looking for new opportunities.  What failure could mean is that you need to look at what you did, what risks you took, what you could have done differently, and learn from any mistakes that you made.  Again, starting a new business opportunity is almost like learning to ride a bicycle. 

When you first start learning to ride a bicycle, you put training wheels on (equivalent to researching and increasing your knowledge).  Once you understand the basics of balance, then you take the training wheels off and try to ride (getting involved in the business).  There will be times that you fall down (perhaps one business opportunity fails…) but after falling down a few times you eventually learn to ride the bicycle without falling down (a successful business).  If you didn’t take the risk of riding the bicycle, you would never discover that you can not only ride the bicycle, but you may really enjoy riding the bicycle.  Your own personal business opportunity can be as much fun as successfully riding a bicycle.

We will continue this discussion next week…

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