Three mistakes made by so many would-be entrepreneurs. Do your best to avoid learning the hard way.

I know there’s #ToughLove in some of what I’m going to write today, but if I don’t tell you these things [which I also tell my own children] then who will?

1. Don’t simply pursue money.

I used to have a friend who was so determined to make money, it almost seemed he was starting a new venture every month. He only needed to hear that someone else was making money in a type of business and he was off. His energy and zeal were incredible, and he was prepared to do anything, or go anywhere, if he heard there was money in it.

Sometimes he would even “strike gold” [so to speak] and for a while he would be loaded with cash, confirming to him that his approach was correct. But before long something would very often go wrong, and he would move on to the next thing.

“Why else would you be in business, if not to make money?” I hear some of you asking.

I know it sounds counter-intuitive, and it’s one of those mysteries of money. Those who pursue after it, for its own sake, usually end up short, in one way or another. Some might even make a lot of money, only to find that it came at a terrible cost.

__“If you want [good] success, identify a human need, and reach out to fulfill it [in a sustainable way, in which you do not harm others or the planet]” … This has always been my takeaway from the teachings of TL Osborne, as most of you know.

I urge you all to consider this wise guideline.

2. The fact that someone else has successfully made a lot of money in a business sector does not mean YOU will. 

You all know that Elon Musk has become the world’s richest man, in part by selling electric cars. Does that mean that all should rush to manufacture electric cars “because that’s where the money is”? No.

If you look at the Forbes Africa list, you will immediately notice that the continent’s wealthiest business leaders mostly made their money in several very different ways. 

__It’s not wise to be drawn to something simply because someone else has made a success at it.

Whenever people come to me looking for a partner to invest in a mining venture, for example, I refer them to the mining entrepreneurs I know. Same with opportunities in the cosmetics industry, and so on. Know thyself!

As some of you know, when I hear of opportunities, I sometimes send my team to find some of you, which is why I often ask you to tell me what YOU do.

Please don’t go racing after every new thing you hear about. Use what is in your own hands [and heads], and continue to #SKILL UP, even more.

3. It’s dangerously misguided to believe that someone is out there to “help” you start or grow your business.

There’s a widely held view that someone is out there whose job it is to “help” you so that you can get capital to start your business and become a success… [Sometimes I read it here in complaints, along with bitter comments about “selfish” others]. 

For sure it would be great if “selfish others” would do more to recognize what you can do, and see [and act upon] your “potential”… The problem is this: In the real world, it could happen, but don’t hold your breath. And definitely don’t count on it.

To do so would be to set yourself up for disappointment. You should realize by now that the world is not a very fair place.

Now one thing that worries me when I read your comments is that some of you still confuse the terms “donor” and “philanthropist” with the term “investor”. That is a dangerous mistake to make!

In short, “donors” and “philanthropists” generally give “grant” funding. They are often wealthy nations, individuals, organisations, foundations, trusts. Some also make “impact investments” [for example in health, education, and/or climate businesses] but I’m not going to get into that subject here today. Especially if you are a social entrepreneur who has specifically chosen to launch a “social enterprise”, you may be positioned to look for both grants and social impact investment. 

It’s up to you to do your own homework here. As for most #Entrepreneurs though: You will need to look for “Investors,” not for donors or philanthropists!

The private “investors” I’m talking about today are those who want to put money into a for-profit business in return for a share of that business. They become co-owners of the business WITH you, and generally will want a say in the decision making.

__Their interest is for the business to grow, so that they can make money. They get their return in one of two ways: either they eventually sell their shares at a higher price to someone else [not likely to be the original founder] or they stay and receive periodic dividends [not favored by most investors].

Whether you live in Angola or Zimbabwe or anywhere in between, did you know that a majority of private investors are actually local, not foreign? I know a lot of you think foreign when you hear the word “investors” but it’s actually not true, if you just stop to think about it for a moment.

Expats in the African diaspora who send money home to family and friends to start businesses are also an important type of investor. Pension funds and insurance companies are also busy “investing” every day.

As an entrepreneur, you really have to figure out how it all works, if you have not already done so. And even if you don’t plan to take your own company “public”, you certainly need to know how investors use a Stock Exchange!

Now I have said a lot of things here today that might surprise some of you, which is my intention. Why don’t you read this carefully, and then list in a comment those things that surprised you most. 

Bottom line: Don’t complain about what you don’t like because nobody really cares, to be honest. I’m just telling you how the world works!

Image: KWB-Ubuntu Hope via AI. “Do not be embarrassed by your failures; learn from them and start again!” Richard Branson