Media praises entrepreneurs as people who pulled it off in spite of all the odds against them. Surely, entrepreneurs are risk takers, right? If there is a 90+% chance that you lose your earnings, reputation, career opportunities, possibly even your family, you must be a lunatic to do it, right?
It depends. If entrepreneur is motivated by some external reward (money, career, status, fame) then yes, he has to be an extreme risk taker to begin entrepreneurial journey.
However, a true entrepreneur, the one who’s above all motivated by developing a product or service that would innovatively solve a certain problem, wouldn’t think that going on an entrepreneurial journey is risky at all. To the contrary, becoming an entrepreneur is usually the only way to bring his idea to life. From his perspective a regular job is unsafe. Not just unsafe - it's a sure failure. Because by taking a regular job he will for sure fail in achieving his goal.
All our actions shall be judged from our vantage point – from our goals. However, that is not the case how we’re most of the time judging the actions of others. Every time we look at the actions of others, we determine, whether their actions were risky under assumption that those people had the same goals that we have. But we know we have different goals. I mean, we’re not all cooks or athletes.
Okay, if you had in mind an objective riskiness in reaching goal, I apologize, but that is not how most people that I know think. What I mean by objective riskiness is, what is the chance that you will achieve a goal, even if you take the most probable path to achieve it. Let’s say someone wants to become an astronaut and someone a firefighter.
I would even say that we are all rational from our own perspective. Because being rational is being risk averse, we are all risk averse. We are all choosing a path that offers the greatest chance of achieving our goal. There are no differences among us in terms of risk aversion. The only difference are our goals.
To turn back to entrepreneurial example. If a person is motivated by money, entrepreneurial journey is probably not the safest way to go (unless you wan't to become a billionaire). According to my theory most people shouldn’t be entrepreneurs then. And they aren’t. Most of the people who are after financial success are crowded in few elite sectors of our economy such as medicine, law, finance and consulting. It’s the safest way to make a lot of money by just working hard and persisting. With a bit of luck you can even throw a fame in there as well.
Not relevant to the point made but on the same topic, I'd like to say a few words why I really like Elon Musk (though not the persona of Elon Musk created by the media!). The guy made millions by selling PayPal and then invested practically all of his money into new entrepreneurial ventures. Only a true entrepreneur would do that. All fake-entrepreneurs would take the money and put it in the vault. Because they don’t have entrepreneurial spirit. They don’t value the experience per se, irrespective of the result. In my eyes Elon Musk is a winner, even if all his project turn out to be financial disasters. Because true entrepreneur does it above all for the reasons that aren’t financial. Hence I could argue that entrepreneur shows his true colors when he makes first serious money. Only if he invests it in new “risky” projects is the guy a true entrepreneur. If he puts the money into a vault and starts selling books about how to make it, then… you know my opinion.
