years of participating in successful and struggling
ventures, I have observed a curious, but fairly consistent pattern
concerning personality traits of
Some of these personality traits, can, putting it bluntly, put to death a new
venture. Certainly these traits can stunt the promised growth of an enterprise.
Paradoxically, the very traits that tend to move a person towards the realms of
entrepreneur can be the same traits that can artificially dissolve a company. I
use "artificially" here because these may be the only issues that are within the
total control of the
new venture. All
other threats tend to be outside the venture, and thus, outside its control.
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The typical entrepreneur is
usually very intelligent.
Yin-Yang of Entrepreneurial Creativity
Unfortunately, pride tends to
follow intelligence. It causes the entrepreneur to be impatient. He can't wait
for the business world to see how brilliant his work is right now. Therefore, he
needs to be involved in each and every detail of the new venture and put his
imprimatur on every event. It is not even sufficient to be involved in every
detail, but all involved must be engaged in seemingly endless debates until they
are convinced that, indeed, the entrepreneur, as the Prime Mover, is correct and
As a corollary to the above,
since the Prime Mover needs constant affirmation regarding his brilliance, he
tends to surround himself with friends and acquaintances whose appreciation for
his brilliance has already been established. This leads to the hiring of not the
best people available for the venture, but the best people for the Prime Mover's
Pride like Cancer
for "I shudder to tell the story") Once the venture has experienced some modicum
success, a most dangerous phase may ensue. Ego, once left unchecked, has now
stifled all dissension. The venture is often left without adequate legal
protection. The Prime Mover thinks that his handshake is more powerful than the
law and the adoration of others makes contracts not only superfluous but even
The love of the product or
invention takes on mythical proportions. Obviously the product should be the
most expensive in the market. The product is a value
proposition that causes the world to turn on its axis. Therefore, the market
will have to wait for a price change, or
license arrangement with third parties or a partial sale of the business for
raising capital. The product rules! The ego rules!
These events usually are
followed by a total deception regarding the uniqueness of the product. The Prime
Mover sees distinctions in the product that no one else can see. The Prime Mover
sees whole market distinctions that no one else can see. Because of this
all-knowing approach, the Prime Mover sees no reason to respond to any outside
force or person. Letters go unanswered. Telephone calls go unreturned. Emails
sit in the inbox.
The Prime Mover may next enter
the "fun" phase. This
phase allows the entrepreneur to get involved in only the most enjoyable aspects
of the venture, e.g. giving interviews, attending conferences, meeting with
marketing gurus. The details of running a company are left to flounder. No need
to worry about
patent protection, legal
tax issues, personnel needs, documentation, quality certifications, or customer
demands. Those issues are not fun.
8 Key Entrepreneurial Questions
Honos habet onus
(Lat. Honor is burdened with
responsibility). Just like cancer that needs treatment, so does the Prime Mover
at this stage. He needs to let go. He should delegate operations to someone who
will do the non-fun. He should take a true interest in the daily operation of
the business from his direct reports.
Often, the Prime Mover is so
taken with himself, that he thinks himself to be above the normal constraints
that inhibit other mere mortals. He may start to have personal failings. His
marriage may suffer because his ego does not fit into the home setting anymore.
He may have affairs, drink too much or suffer health problems. Others will see
this although the Mover will not. Fama nihil est celerius. (Lat. Nothing travels
more swiftly than scandal.) You can bet on forgetting to register the car.
(Lat. A spoiled child of
Fortune). By this time, the friends who were hired earlier are starting to talk
behind the Primer Mover's back. Morale in the company really starts to suffer.
The prime mover tends to display a curious lack of basic social skills. He lies.
He is impolite. He just does not understand that the commercial world buys a
product for what it can do – not because it loves the inventor of the product.
Soon, the company can get a reputation for having a good product, but it is too
begin to view the company as “they”; "they" are hard to deal with and "they"
will not license on reasonable terms and "they" don't return calls anyway.
(Lat. Troy was, but is no more).
In the final stages of the venture, assaults on success are coming from within
and without. A split may occur in the company. Employees may take the technology
and start their own venture. Competitors who were denied licensing arrangements
may produce the product in house and enjoy eating the Prime Mover’s lunch as
they remember their unreturned emails. Facile est inventis addere. (Lat. It is easy
to improve what has already been invented.)
of the “non fun” issues now take on mountainous proportions to heights that the
venture may not be able to scale.
If the venture is fortunate, the
Prime Mover may start to realize that the business is in real trouble. However,
instead of listening to voices inside the company, the Ego at the helm may find
himself only able to be influenced by an outside consultant who will expensively
advise on all sorts of issues and never, for political reasons, flag the one
salient wart of all –– the personality traits and ego of the entrepreneur
Failure of the enterprise is
often the likely result.
Resemblance to any person now
living or in bankruptcy is purely coincidence.
Craig Silver is currently the VP
of the Open Systems Group and General Counsel to Patton Electronics Company-a
telecommunication equipment manufacturer. Other experience includes five years
of general management of a digital signal processing company and 15 years of
general law practice advising, inter alia, start-up high technology
Experto crede (Lat. Believe one who has tried it.)