3.04.2015

The Two Types Of Entrepreneurs And Why You Should Be Both

By Pini Yakuel, fastcompany.com
Are you a rational or romantic entrepreneur? The ideal may be a mix of both.
Entrepreneurs are motivated by a variety of factors. Some are driven by money, others by fulfillment. Some are simply addicted to the excitement, while fame motivates others. Many simply can't imagine
working for someone else.
In my experience, we can divide entrepreneurial motivations into two prototypes sitting on opposite ends of a spectrum: the rational entrepreneur versus the romantic entrepreneur. In reality, each entrepreneur is a mix of these two prototypes, and like many things in life, the secret is moderation. Successful entrepreneurship, in my opinion, is a healthy blend of romanticism and practicality.

Two Entrepreneurial Prototypes

Rational entrepreneurs are motivated by practicality. The extreme among them love Excel sheets, numbers, and figures. They are knowledgeable of market trends and the competitive landscape almost to the point of obsession. They try to predict the future and plan as much as possible—all to minimize risk. Entrepreneurs who are too analytical, however, tend to get cold feet and are paralyzed when the numbers don't add up. Cold, hard analysis 100% of the time doesn't leave any room for romance—it puts the brake on creativity and impulsivity.
In contrast, romantic entrepreneurs are motivated by their passion. They have an overwhelming desire to create something that solves a particular problem. Die-hard romantic entrepreneurs don't research anything—neither the market, nor the competition. They don't have a business plan, a financial plan, or any type of plan. Their excitement impedes their ability to see reality. Extremely romantic entrepreneurs are prone to mistakes and solving problems that aren’t a true pain point.

Shift Toward The Right Prototype At The Right Time

At different stages in your business you’ll need to lean more toward romanticism or rationality. In the kick-starter stage of a business you’ll want to be more romantic—relying on your gut feeling and passion to jump-start your business.
Optimove's first customer was a chain of seven supermarkets that sold organic food. Our job was to mine their customer data and derive meaningful insight. Unfortunately, they refused to provide us with central access to the data, and we were blocked. A more rational person might have given up at that point, and shift his or her effort to finding a customer that offered easier access to their data.
Despite this, I realized that we needed to push our way through this, especially at such an early stage of the business. I personally traveled to each of the chain’s stores, saving the data sets on a flash drive. My stubbornness and drive brought out my more romantic entrepreneur inclinations that were the more important focus at this stage of the business.
As your business progresses, however, you’ll find that romantic tendencies aren’t enough, and you’ll want to listen more to your rational side. At a certain point, I knew that my business’s service-based offering would need to shift to a product-based business to be more scalable, more efficient, and to increase revenue. Yet to make the pivot a reality, I needed to hone the methodologies and technologies gained during years of providing services. Practicality—not passion—ruled at this stage of the business.
At other times, you’ll need to simultaneously have the right blend of each. When expanding the team we would hire many young talents—not as experts, but as those who shared our romantic passion and vision for the future. Yet, we needed to be rational enough to hire experienced senior talent and tap into their expertise to keep the company growing.
Regarding marketing efforts, I found instead of acting rational and trying to quantify every single channel individually, it pays to take a more holistic view. Instead of concentrating solely on measuring marketing return on investment for each channel, I started looking at the entire range of touch points prospects have with various marketing channels.
I realize in measuring your marketing efforts, being rational can actually hinder you—causing you to ditch certain channels that aren’t as ROI effective as others. In the long-term, you want to take a more romantic approach that gives you an understanding of how your different channels, combined together, create a larger system that generates and nurtures leads, shortening the sales cycle and increasing your conversions.
Quantifying the results of your marketing efforts as a whole, rather than as separate marketing channels, enables you to reach better results, and use channels that don’t necessarily seem efficient when looking at them individually.
One last example for shifting between rationality and romanticism is from the world of product development. In this complex process, you need to ensure that your product maintains its product identity, while at the same time creating enough features that allow your product to be as competitive as possible in the marketplace. You obviously want to be attentive to your customers and develop features that are in tune with their day-to-day needs. At the same time, you need to be loyal to your product’s core identity to ensure it continues to serve its original purpose.

Creating The Right Entrepreneurial Blend

In my opinion, the right combination of romanticism and rationality is a critical factor for entrepreneurial success. It pays to take a step back and remember why you started your business in the first place. You can also imagine where your business might take you one day once your product and team are in place. You might also want to put limits on your romantic tendencies by pushing rationality into the equation. You’ll do this by focusing on quantifying your efforts, and paying careful attention to your numbers when scaling the business.
Many factors contribute to the end success or failure of a company. The right combination of romanticism and rationality, as well as the ability to leverage the benefits of both, are critical factors for entrepreneurial success.
Pini Yakuel, founder and CEO of Optimove, has more than a decade of experience in analytics-driven customer marketing, business consulting, and sales. His passion for understanding what drives customer behavior led him to spearhead the development of Optimove, a market-leading customer retention automation software, used by 100-plus online businesses, empowering marketers to maximize their customers’ value.

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