The Entrepreneur Quiz

Who is the entrepreneur? What molds him and what motivates him? How does he differ from the nine-to-fiver, and where are those differences most telling? Why will one brother set out to build a business while another aspires to promotions and perks? Why does one stay up nights working on a business plan while the other brags about his pension plan? Is it brains? Luck? Hard work? Something else?

When most people think of entrepreneurs, such names as Henry Ford and Edwin Land and even Famous (Wally) Amos automatically come to mind. But, in fact, American entrepreneurs number in the millions. Of the approximately 16,000,000 businesses in this country, more than 12,000,000 are operated as sole proprietorships. And while not all of those businesses can be labeled "entrepreneurial ventures," a dictionary definition of an entrepreneur is "one who manages, organizes and assumes the risk of a business or enterprise."

Why, then, do we think of the entrepreneur in almost mythical terms? The answer is easy. Like the cowboys of the old West, the entrepreneur represents freedom: freedom from the boss, freedom from the time clock and--with a lot of hard work and more than a little luck--freedom from the bank.

So who is the entrepreneur? Anyone who has ever looked at a problem and seen an opportunity as well as a solution is a likely prospect. The same goes for anyone who feels his ambition is being held in check by corporate red tape. But it takes more than just cleverness and frustration to get an entrepreneurial venture off the ground. It takes guts, an indefatigable personality and nothing short of total dedication to a dream. On top of that, it takes the kind of person who can call working 90 hours a week fun.

While there is no single entrepreneurial archetype, there are certain character traits that indicate an entrepreneurial personality. In this quiz, developed from a series of questionnaire analyses performed by The Center for Entrepreneurial Management, of which I am president, we've concentrated on those indicators. If you've ever wondered whether or not you have what it takes to be an entrepreneur, here's your chance to find out.

(scoring on page 140)Entrepreneur Quiz(continued from page 81)

1. The independent way of life is not so much genetic as it is learned, and the first school for any entrepreneur is the home. It's only natural that a child who has grown up in a home where at least one parent is self-employed is more likely to try his hand at his own business than a child whose parents were in, say, the civil service. Research has shown that to be the case more than two thirds of the time.

Scoring: A.10; B.5; C.5; D.2; E.0

2. This question is tricky, because the independent-thinking entrepreneur will very often quit a job instead of waiting around to get fired. However, the dynamics of the situation are the same: The impasse results from the entrepreneur's brashness and his almost compulsive need to be right. Steven Jobs and Steven Wozniak went ahead with Apple Computer when their project was rejected by their respective employers, Atari and Hewlett-Packard. And when Thomas Watson was fired by National Cash Register in 1913, he joined the Computer-Tabulating-Recording Company and ran it until a month before his death in 1956. He also changed the company's name to IBM. The need to be right very often turns rejection into courage and courage into authority.

Scoring: A.10; B.7; C.0

3. America is still the land of opportunity and a hotbed for entrepreneurship. The displaced people who arrive here every day--be they Cuban, Korean, Vietnamese or whatever--can still turn hard work and enthusiasm into successful business enterprises. Although it is far from a necessary ingredient for entrepreneurship, the need to succeed is often greater among those whose backgrounds contain an extra struggle to fit into society.

Scoring: A.5; B.4; C.3; D.0

4. It's been said that "inside every corporate body, there's an entrepreneur struggling to escape." However, small-business management is more than just a scaled-down version of big-business management. The skills needed to run a big business are altogether different from those needed to orchestrate an entrepreneurial venture. While the professional manager is skilled at protecting resources, the entrepreneurial manager is skilled at creating them.

Scoring: A.10; B.5; C.0

5. The enterprising adult first appears as the enterprising child. Coin and stamp collecting, mowing lawns, shoveling snow, promoting dances and rock concerts are all common examples of early business ventures. The paper route of today could be the Federal Express of tomorrow.

Scoring: A.10; B.7; C.0

6. The average age of entrepreneurs has been steadily falling since the late Fifties and early Sixties, when it was found to be between 40 and 45. Our most recent research puts the highest concentration of entrepreneurs in their 30s, but such people as Jobs and Wozniak, Ed DeCastro and Herb Richman of Data General and Fred Smith of Federal Express all got their businesses off the ground while still in their 20s. Although we look for those data to stabilize right around 30, there are always exceptions that leave us wondering. Computer whiz Jonathan Rotenberg is just such an exception. He currently presides over the 10,000-member Boston Computer Society, is the publisher of the slick magazine Computer Update and earns up to $1500 a day as a consultant. In 1978, his advice was solicited by the promoter of an upcoming public computer show. After conferring with him several times on the phone, the promoter suggested they meet for a drink to continue their discussions. "I can't," Rotenberg replied. When asked, "Why not?" he answered, "Because I'm only 15." An established entrepreneur, Rotenberg is now all of 20 years old.

Scoring: A.8; B.10; C.5; D.2

7. The answer to this question is always the same. Entrepreneurs are most commonly the oldest children in a family. With an average of 2.2 children per American family, the chances of being the first child are less than 50 percent. However, entrepreneurs tend to be the oldest children more than 60 percent of the time.

Scoring: A.15; B.2; C.0; D.0.

8. Our research concluded that the vast majority of entrepreneurs are married. But then, most men in their 30s are married, so that alone isn't a significant finding. However, follow-up studies have shown that most successful entrepreneurs have exceptionally supportive wives. (While our results didn't provide conclusive results on female entrepreneurs, we suspect that their husbands would have to be doubly supportive.) A supportive mate provides the love and stability necessary to balance the insecurity and stress of the job. A divorce or a strained marriage or love life will simply add too much pressure to an already strained business life.

It's also interesting to note that bankers and venture capitalists look a lot more favorably on entrepreneurs who are married than on those living with their mates without the benefit of clergy. As one venture capitalist told us, "If an entrepreneur isn't willing to make a commitment to the woman he loves, then I'll be damned if I'm going to make any financial commitment to him."

Scoring: A.10; B.2; C.2.

9. The question of formal education among entrepreneurs has always been controversial. Studies in the Fifties and Sixties showed that many entrepreneurs had failed to finish high school, not to mention college. Our data, however, conclude that the most common educational level achieved by entrepreneurs is the bachelor's degree, and the trend seems headed toward the M.B.A. Few entrepreneurs have the time or the patience to earn a doctorate.

Scoring: A.2; B.3; G.10; D.8; E.4

10. Entrepreneurs don't like working for anyone but themselves. While money is always a consideration, there are easier ways to make money than by going it alone. More often than not, money is a by-product of an entrepreneur's motivation rather than the motivation itself.

Scoring: A.0; B.15; C.0; D.0

11. These results really surprised us, because past studies, including our own, have always emphasized the strained or competitive relationship between the entrepreneur and the income-producing parent (usually the father). However, our latest study showed that a surprising percentage of the entrepreneurs we questioned had what they considered to be a comfortable relationship with that parent. To a large extent, we think that is directly related to the changing ages and educational backgrounds of the new entrepreneurs, who are children of the Fifties and Sixties, not children of the Depression. In most cases, they've been afforded the luxury of a college education, not forced to drop out of high school to help support the family; so the entrepreneur's innate independence hasn't come into such dramatic conflict with the father as it might have in the past. We still feel that a strained or competitive relationship best fits the entrepreneurial profile, though the nature of that relationship is no longer black and white.

Scoring: A.10; B.5; C. 10; D.5

12. The difference between the hard worker and the smart worker is the difference between the hired hand and the boss. What's more, the entrepreneur usually enjoys what he's doing so much that he rarely notices how hard he's working. A decision is an action taken by an executive when the information he has is so incomplete that the answer doesn't suggest itself. The entrepreneur's job is to make sure the answers always suggest themselves.

Scoring: A.0; B.5; C.10

13. Entrepreneurs seldom rely on internal people for major policy decisions, because employees very often have pet projects to protect or personal axes to grind. Outside financial sources simply lack the imagination that characterizes most entrepreneurs. The most noble ambition of most bankers and accountants is to maintain the status quo. When it comes to critical decisions, then, entrepreneurs most often rely on outside management consultants and other entrepreneurs.

Scoring: A.0; B.10; C.0; D.5

14. Contrary to popular belief, entrepreneurs aren't high-risk takers. They tend to set realistic and achievable goals, and when they do take risks, they're usually calculated ones. Entrepreneurs are very confident in their own skills and are much more willing to bet on their tennis or golf game than they are to buy lottery tickets or to bet on spectator sports.

Scoring: A.0; B.2; C.10; D.3

15. All businesses begin with orders, and orders can come only from customers. You may think you're in business when you've developed a prototype or after you've raised capital, but bankers and venture capitalists buy only potential. It takes customers to buy product.

Scoring: A.0; B.10; C.0; D.0

16. Like billionaire Daniel Ludwig, many entrepreneurs will adamantly state that they have no hobbies. But that doesn't mean that they have no social life. In fact, the entrepreneur is a very social person and, more often than not, a very charming one. (Remember, an entrepreneur is someone who gets things done, and getting things done often involves charming the right banker or supplier.) And while he will often have difficulty talking about things other than himself or his business, his enthusiasm is such that whatever he talks about sounds interesting.

Scoring: A.0; B.10; C.3; D.0

17. One of the biggest weaknesses that entrepreneurs face is their tendency to "fall in love" too easily. They go wild over new employees, products, suppliers, machines, methods and financial plans. Anything new excites them. But those love affairs usually don't last long; many of them are over almost as suddenly as they begin. The problem is that while they're going on, entrepreneurs can quite easily alienate their staffs, become stubborn about listening to opposing views and lose their objectivity.

Scoring: A.5; B.5; C.5; D.5; E.15

18. The answer to this question is easy: "Bright and energetic," right? Wrong. That describes a personality like your own. But stop and think a minute. You're the boss. Would you be happy--or for that matter, efficient--as someone else's right-hand man? Probably not. And you don't want to hire an entrepreneur to do a hired hand's job.

That's why the "bright and lazy" personality makes the best assistant. He's not out to prove himself, so he won't be butting heads with the entrepreneur at every turn. And while he's relieved at not having to make critical decisions, his delegating ability makes him a whiz when it comes to implementing them.

Scoring: A.2; B.10; C.0

19. Organization is the key to an entrepreneur's success. It is the fundamental principle on which all entrepreneurial ventures are based. Without it, no other principles matter. Some entrepreneurs keep lists on their desks, always crossing things off from the top and adding to the bottom. Others use note cards, keeping a file in their jacket pockets. Organizational systems may differ, but you'll never find an entrepreneur who's without one.

Scoring: A.5; B.15; C.5

20. The only thing an entrepreneur likes less than discussing employee problems is discussing petty-cash slips and expense accounts. Solving problems is what an entrepreneur does best, but problems involving employees seldom require his intervention, so discussing them is just an irritating distraction. Expense accounts are even worse. What an entrepreneur wants to know is how much his salespeople are selling, not how much they're padding their expense accounts.

Scoring: A.8; B.10; C.0; D.0

21. Entrepreneurs are participants, not observers; players, not fans. And to be an entrepreneur is to be an optimist: to believe that with the right amount of time and the right amount of money, you can do anything.

Of course, chance--being in the right place at the right time--plays a part in anyone's career; but entrepreneurs have a tendency to make their own chances. There's the old story about the shoe manufacturer who sent his two sons to the Mediterranean to scout out new markets. One wired back, "No point in staying on. No one here wears shoes." The other son wired back, "Terrific opportunities. Thousands still without shoes." Who do you think inherited the business?

Scoring: A.0; B.15

22. Sales give instant feedback on your performance; it's the easiest job of all for measuring success. How does a personnel counselor or a teacher ever know if he's winning or losing? Entrepreneurs need immediate feedback and are always capable of adjusting their strategies in order to win. Some entrepreneurs brag that they play by the rules when they're winning and change the rules when they're losing. Although we don't endorse it (look what happened to John DeLorean), when it works, it's known as the win/win strategy.

Scoring: A.3; B.10; C.0; D.0

23. While friends are important, solving problems is clearly more important. Often, the best thing an entrepreneur can do for a friendship is spare it the extra strain of a working relationship.

Scoring: A.0; B.10

24. Everyone knows that a camel is a horse that was designed by a committee, and unless it's clear that one person is in charge, decisions are bound to suffer from a committee mentality.

Scoring: A.10; B.2; C.0

25. Vince Lombardi was famous for saying, "Winning isn't everything, it's the only thing." An entrepreneur would agree with that, but he would also leave himself an emotional loophole. "We didn't lose any games last season," he might say; "we just ran out of time twice." Entrepreneuring is a competitive game, and an entrepreneur has to be able to bounce back.

Scoring: A.8; B.10; C.15; D.0

"The average age of entrepreneurs has been steadily falling since the late Fifties."

Your Entrepreneurial Profile

225--275 Successful entrepreneur*

190--224 ......Entrepreneur

175--189 .. Latent entrepreneur

160--174 . Potential entrepreneur

150--159 Borderline entrepreneur

Below 149 ......Hired hand

*The average C.E.M.-member profile is 234.