If everyone is a genius, why do so many people crash and burn? I’ve had my fair share of crashes in my life, and I’ve learned there are just four reasons why over 80% of small business owners crash their business within 3 years. What are they and how do you avoid them?
You might have heard the saying “An entrepreneur is someone who jumps from a plane without a parachute, and figures out how to build one on the way down.”
After 30 years as an entrepreneur, I’d say the truth is the exact opposite. Entrepreneurs don’t fall down. They rise up. They don’t head for the ground. They reach for the sky. Here I am in a video with the four reasons for failure, with an image not of parachutes, but of balloons…
…(ALOT of balloons)…
Failure One: Heading upwind
Balloons are a great analogy for business. Richard Branson knows this intimately. He still holds the record for the longest balloon flight from Japan to Canada back in 1991. What does his flight have in common with his businesses? With expert pilot Per Lindstram they looked for the biggest, fastest wind in the world, the north pacific jet stream, they built a balloon big enough to ride it – the Pacific Flyer (still holding the record for the biggest balloon) and they plotted a course to ride it (and they still hold the record for the fastest balloon speed of 245mph)
Think of your market as the wind. Think of your balloon being your value to the market – your brand and products. And think about your plan as your flight path. Failure number one are the business owners who plot a path that doesn’t ride the wind. There’s no point trying to go West if the wind is blowing East. Are you riding your market, or fighting your market? Do you have a balloon that suits the wind and a flight path that gets you in flow? Or are you trying to head upwind?
Every Virgin business that Richard Branson starts is like that balloon. He looks for the biggest, fastest market, he sets a flight path with his team and then the wind takes care of the rest.
Failure Two: Too big (or small) a basket
You might get your direction right, but without the right basket you’ll end up stuck on the ground or rising so high you pop. Your basket is your infrastructure and the costs in your business. Start with too much, and you won’t be able to take off. Forget to invest, and you’ll be hanging on to the balloon without the basket. Or find yourself in a basket too small to take a team.
It’s a balancing act where we’re no longer talking about direction. We’re talking about altitude. How do great balloonists manage their altitude? It isn’t just about adjusting the hot air. They will weigh everything, keep themselves tied down until they are ready for lift off, and they will take extra sandbags they can throw off if they need to. Many businesses crash because they took on too much weight or built a basket that was too small. Build flexibility in your costs. Take your sandbags, and know that managing your altitude is the key to your success.
Failure Three: The wrong crew
If you’ve got the right direction, and the right sized basket, you may fail with the wrong crew (or no crew at all). In another balloon flight over the Atlantic, back in 1987, Richard and Per hit the atlantic ocean when their baloon malfunctioned. Per jumped off and before Richard could follow, the balloon, out of control, shot back in the sky. He had the chance to parachute out, but remembered his luck with parachutes…
Back while doing training jumps, Richard accidentally unbuckled his parachute while in mid-jump. An expert jumper in the team caught up with the falling Billionaire and yanked open his reserve parachute. It was that experience which stopped Branson from jumping and he hung on in there until several hours later, by luck, the balloon dropped back down to a safe height for him to jump into the sea off Scotland.
As you rise up in your balloon, your view grows – as does the distractions. Do you have a crew that can cope with the distractions? Are they they lifting you up or weighing you down? It’s helpful to know that the Four Geniuses each have a different strength in guiding the balloon:
Dynamo Geniuses (Spring Energy) – Are best at setting direction and speeding up
Blaze Geniuses (Summer Energy) – Are best at growing the flame and rising up
Tempo Geniuses (Autumn Energy) – Are best at controlling speed and slowing down
Steel Geniuses (Winter Energy) – Are best at cooling down and dropping down
Take the Genius Test if you haven’t (www.mygeniustest.com) to see which you are, and test your team. For even better control, have a look at the Wealth Dynamics (for entrepreneurs – www.wdprofiletest.com) and Talent Dynamics (for employees – www.tdprofiletest.com) to see how these four divide into eight profiles on each side and corner of the square. Which genius and profile are you and who do you need in your crew?
Failure Four: Too much hot air
What’s the last of the four reasons for failure? Too much hot air!
You need hot air for a balloon to lift off. But too many of us rely on our own hot air when we get started. We end up over-promising, over-trading or over-expanding. We try and blow too hard and grow too fast. We don’t need to use our own hot air when there is a different kind of air we can rely on. The word ‘spirit’ comes from the Latin ‘spiritus’ which means ‘breath’. There is an entrepreneur spirit we can harness when we meet with others and work together. When we harness this spirit, we no longer need to try and do it all on our own.
These are the four reasons for most business failures: Either heading in the wrong direction, not getting the right lift, with the wrong crew, or with too much hot air (or combinations of the four).
Get it right though, and you take off. That’s when life shifts from spectator to spectacular. One balloon makes a flight. Many balloons make a festival.
Watch the video for a spectacular view from the New Jersey Balloon Festival, and then join me at www.millionairemasterplan.com as my book launch has finally arrived. The doors of our online university, GeniusU are now open and our community is taking flight. It’s finally time for take off!
Keep shining brightly,