Recently I was reading Kenya Airways’ Msafiri (the airline’s inflight magazine) and I came across one very interesting article about outstanding young entrepreneurs in Africa. Names that surfaced there include Gilbert Eugene Peters, the 30 year old Zimbabwean Chief Creative Officer of Spidex Media; Olawale Ayilara, the 29 year old Nigerian CEO of LandWey Investment, and Leroy Mwasaru, the 20 year old Kenyan founder of Greenpact. These are young African entrepreneurs making waves in business, profiled on the basis of issues such as the fresh business ideas they had, the size and revenue, potential, social impact and resilience.
One statement made by Leroy Mwasaru that caught my attention was this, I quote; “Many entrepreneurs start a business expecting instant gratification through immediate profits, but most successful businesses don’t work that way. You need to be guided by a vision of creating a better future’. Candidly, I thought that was a powerful statement, and today I decided to write a brief article about the top seven reasons why an entrepreneur should delay gratification through immediate profits. This article hinges on the need to exercise patience and wait before you starting enjoying your business profits.
Some of the points that quickly came to my mind were the following: –
1. Delaying gratification enables you to have clarity and long term vision about your business. Building a business that will last and continue generating and delivering real value to various stakeholders requires clarity of purpose and vision. This has to develop with time and focus. However, if your mind is on eating you simply cannot focus on other serious things until you have eaten. Again, when you start eating you may not be satisfied unless you seriously restrain yourself. So, you need to delay enjoying your business profits but rather put effort in building it first. Your mission and vision should rank higher than profits, and in fact when you get those fundamentals right consistently the money will come later in big numbers for you to enjoy. Not so?
2. Some early profits are results of chance rather than good business principles, and may not be sustainable. My dear entrepreneur, you need to be very careful about those early profits before you get consumed in enjoying them and you lose tract entirely. Sometimes business and even profits can be deceptive, manifesting very good returns without any fundamentals you have got right. This could be circumstantial and may not last. This is another strong reason why you need to delay gratification to try and check the consistency of your profits. If you get many aspects of your business right, the enterprise will grow and you will have continuous profits.
3. You can reinvest and expand your business with limited discomfort of loans and other financing sources with potential adverse effects. Business growth and expansion always requires money. Isn’t this the case? Of course some of the sources of funding such expansions include bank loans, venture capital etc. Some of these sources can oftentimes be very challenging and annoying. Don’t get me wrong. I’m not hostile to bankers. In fact some of my best friends are bankers. Beyond banks, other financing sources could also come with unpleasant demands. Equity investors and venture capitalists could sometimes be worse than banks. If you want to avoid the discomfort in dealing with these guys, consider retaining your profits so that you have a good starting point to get the extra funding you need. Reinvesting your profits gives you more value tomorrow or in several years to come, and also helps you avoid too much running up and down to get that extra funding you need. Isn’t this fantabulous?
4. Avoid distraction that prevents you from scaling to the next level. Come on Mr. Entrepreneur, when you are building a business, you are on a great mission and you need to focus on that. You need to focus on the things that matter such as building your team, developing your A team (highest level performers), strategy, instilling business discipline across the enterprise, improving your product, services and processes, ensuring due diligence etc. If you start enjoying your small profits and living your life like the world is about to end, woe to you! Failure to delay gratification can hamper your efforts to scale up the business and improve your ranking among your peers. Don’t you agree with me on this? I can hear some entrepreneurs saying they don’t need the stress of a big business blah blah blah! It’s your choice, and I will not interfere with it. Nevertheless, I guess you would not miss the chance for something better if it was there for you to take.
5. You need to validate your success in light of your strategy, tactics, industry etc. before you can start enjoying the rewards of your labour. Another strong reason for an entrepreneur to delay gratification is the need to validate several things. When you are building your enterprise you need to validate your business strategy and tactic, your industry performance etc. You need to recheck your business credibility, including knowing your risks and learn from everything. You need to be smart enough to know the unpredictability of certain things in your trade. You also need to learn to make the best choices. These may all be distorted when your mind is on enjoying profits. Business is iterative and during validations you can refine many things to get better results.
6. Delayed gratification is empowering and makes you handle success with sobriety and humility. Delaying gratification is key to general business success and financial success. It enables you deal with the pain of patience. It also enables you to be more self- motivated and dependable. It is generally empowering. This happens due to the fact that you are wholly focused on the future and not the present. Someone with a big idea and mission in the world cannot mess around with things that don’t contribute positively to that big mission.
7. Great things come to the patient. Entrepreneurs that are in a hurry to start enjoying profits early instead of building for the long term, usually wreck their business. If you focus on the short term gain you behave like a dealer and people treat you like that. They may not rely on you too much. Don’t you agree with me? If you speak to some serious entrepreneurs you will probably get stories of hard work for 10+ years to reach a reasonably good and stable business point or status. Many investments take about 3-5 years (and even more) in the first instance to start making some good profits. After this, more years are required to continue building the business and scaling it in order to maximize the return on investment. Even building a strong brand takes years and even decades in many cases. So, who are you to start thinking of enjoying your profits so early? Come on. Great things come to the patient.
Permit me to stop here for today. At least I have given some good reasons why an entrepreneur should delay gratification, and postpone enjoying profits until further notice. I entirely agree with Leroy Mwasaru on his viewpoint.
With every good wish,
The Wise Entrepreneur