Well, we know that many portfolio workers – but not all, are entrepreneurs. And we know all entrepreneurs take lots of risks – don’t we?
Years ago when I was running Lifeskills International we had a brilliant consultant working with us who has gone on to be the leading proponent of strengths coaching in the UK – Mike Pegg. I always saw myself as an entrepreneur and certainly people saw me as someone who often took great risks in my professional and personal life. I described myself to the always wise Mr Pegg in those terms and he proceeded to explain to me that most entrepreneurs are not really great risk takers. They plan their moves very carefully and always have a plan B but to the outside world they often do appear to be people who love to take wild risks. He analysed every career move and a few personal moves too and I realised he was spot on. So imagine my interest to see a study just carried out for AXA by the Association of Business Psychologists, who found that out of a population of 250 the majority (52 per cent) of small-business owners questioned fell within one of three risk types: wary (22 per cent), prudent (15.2 per cent) or deliberate (14.8 per cent). And the entrepreneurs surveyed showed far less adventurous characteristics (3.6 percent) than the average member of the public (12.8 percent). 2,000 members of the public were assessed for comparison.
The 250 business owners surveyed represented limited companies, sole traders and partnerships. It seems that business owners working alone are more carefree, intense and spontaneous than those working in partnerships, making them more flexible in their decision-making. By contrast, those working in partnerships are more likely to be wary, prudent and composed.
Despite the seemingly conservative approach taken by entrepreneurs, the research found that people who are calm, confident, optimistic, organised, methodical and measured have greater financial resources and may, therefore, make more successful small-business owners.
Katie and I often asked how someone should plan for a portfolio career and what financial tips we can give them. We always emphasize conservative strategies such as saving up to give you a 6 month cushion, using redundancy money, moving to part time to build it up in your free days. We also took about the ‘leap and the net will appear approach’. In all the people that we interviewed for the book only one took this approach. We would be far too nervous to do that – and apparently would most people. So are you a risk taker or not? Or you perceived as more of a risk taker than you are?