5 Functions of an Entrepreneur [Essential]

A startup grows depending upon the dedication and hard work that is shown by its associates. A lot of this growth is derived from the founders or entrepreneurs, who are the spearhead of the organization. Also, the functions of an entrepreneur play the most important part in the journey.

Thus, a person to build a startup must know the following five essential functions of an entrepreneur that have a substantial effect on success or failure.

1. Keeping the startup profitable

Well, it might sound cliche, but with the glorification of raising funds, many startups dilute the focus on building a robust revenue model that generates profit. An entrepreneur must keep ‘profit’, as one of the topmost priorities, and make sure to work on product improvement, and customer satisfaction to keep cash flow positive.

Many new entrepreneurs make the mistake of focusing on raising funds at an early stage. They forget that it dilutes the equity, and sometimes hampers the startup growth in the long term. The startup after some time shut’s down; as it does not have a solid working model that generates profit.

So, it’s good to remain bootstrapped. In the early stages, try to focus on customer acquisition and satisfaction, and profit. Keep valuation or fundraising a by-product, and not the sole aim.

2. Building the startup around a purpose

It’s a very important function, which helps a business in standing apart in the ever-growing competition. As an entrepreneur, you must have a clear purpose behind starting your business; the purpose should be clear, concise and one-liner. For example, the purpose of Goodvitae is to help those who dare to dream.

Once you know your purpose, try to build your business around it; hire people who believe in the same purpose. Also, you should concentrate on customers who believe in your purpose. Because, when two people find unison in a purpose; the work doesn’t limit itself to chasing numbers; rather it becomes more about making an impact.

Employees and entrepreneurs with a clear purpose always have the motivation, and they give their 100% without compromising on anything. So, find a purpose, and build your startup around it.

3. Delegating work

If you want to grow a business, then you have to learn to delegate. Many times, entrepreneurs hesitate to delegate a task that they do daily; just because they are doing it for a long time. It’s a human tendency to not give up endearing things, which can be sometimes a task related to work. But, it can congest the schedule, and make the functions of the entrepreneur rigid. As the startup grows, an entrepreneur must be open to changes in his role to face daily challenges and tasks.

4. Disrupting to survive

The world and the way people do business is changing at a rapid pace, and an entrepreneur must keep an eye on changes and transformation that are happening in the respective field. If transformation is real and massive, an entrepreneur must not hesitate to completely disrupt his or her traditional way of doing the business and integrate new ways into the system. It’s even important to completely change the products and services if the transformation demands such.

Always remember that it’s far better to blow up your own business in a controlled manner; than by a competitor having a technological advantage. Remember the example of Nokia and Blackberry, who kept a blind eye towards the revolution that the Android was bringing, and continued doing things as they are.

5. Fostering a Friendly Environment 

It’s a crucial function of an entrepreneur to foster a healthy and friendly culture in the employees, and people working for the startup. In the process to chase targets, sometimes entrepreneurs follow the bad practice of rewarding an employee out of the team based on the number of sales that he or she made. This creates competition between employees and hampers team harmony.

As a leader of the startup, an entrepreneur has to create a culture of chasing purpose, and not targets; which boosts the team bond and helps the workforce focus in one direction. Also, the whole team should be rewarded for achieving goals.

It’s important to note that employees play a crucial role and have a more impact on the future of the startup than a founder. Thus, it’s essential to create an atmosphere of respect and belonging in the office.

In the end, it’s important to point out that entrepreneurship and its function are multi-faceted and success depends on tons of factors. Don’t get carried away by myths of entrepreneurship in the beginning. Work hard with a purpose rather than just being money-minded or a domain expert.