First of all, risk can be defined by two variables: the chance of success and what there is to lose. These two variables will set the level of how much an entrepreneur is a risk-taker.
Indeed, the most challenging part of an entrepreneurial journey is the start.
Most of the time, entrepreneurs give up a secured situation with a monthly salary to start their own business that has a 90% chance to fail. Revenue is not coming directly after the launch. Some entrepreneurs will invest a significant amount of their own money in starting without paying themselves, sometimes for more than a year.
Therefore, an entrepreneur put himself at risk but also his loved ones.
The risk of failure is the global risk that pops in our mind when we speak about entrepreneurial risk.
But there are several types of risk regarding money, decision process, vision, market, lifestyle, human resources..
Financial risk: Most of the time, entrepreneurs leave a salary and invest money in their projects without any certainty of earning money from it.
Risky decision: Every decision that an entrepreneur takes has a direct impact on his project.
A single wrong decision can be deadly for the venture. This is why investing in yourself with a coach or mentor who has already been down the path is crucial to success.
At every step of a venture, there are significant personal and professional decisions that have to be taken.
If the entrepreneurs choose a wrong path, it risks losing everything he has Entrepreneurs see opportunities where others see risks.
For them, it is not risks to take but opportunities to catch.
It is by catching those opportunities that an entrepreneur will succeed.
Then, once the entrepreneur has launched his business, he sees risks as a reasonable path to success.
Entrepreneurs deal with uncertainty daily. Will this client sign the contract? Will my advertising reach a good population? Is my product good enough? And so on so forth.
An entrepreneur is not becoming a risk-taker while creating his business. It is his experience that gave him an entrepreneurial mindset.
Finally, to be in the 10% successful ones, an entrepreneur needs to think big, to have ambition, to be confident, to invest in themselves without hesitation, and to imagine new solutions.
These characteristics require to take risks. Whether it is small risks that can be measured and control or bigger ones that can jeopardize the venture, a good entrepreneur needs to take it.