Most entrepreneurs, unless they possess the special skills to turn around a troubled business, do much better starting a new business. However, for that special breed of aggressive entrepreneur who has some expertise in "finding" assets in troubled businesses and turning them around, buying a flagging business can bring both profit and excitement.
What motivates these individuals to take the wheel of someone else’s sinking ship? Certainly, one can enter the market for turnaround opportunities with fewer assets and far less competition, though in these situations the risk at stake is often far less than the risk taken. Motivation often comes from the risk itself—the love of the challenge. These risk takers see possibility where others only see problems. They have a vision few can see, yet they walk with their feet on the ground. Often, these gutsy individuals leave safe, high-paying jobs to pursue their ideas for bringing a failing business up to speed in the current marketplace.
It takes some degree of understanding a business to be able to determine whether your ideas for its potential are valid. Possessing the ego power and confidence to make a winning play in what has been, up to now, a losing game is essential. Many highly successful entrepreneurs are renowned for their “rescues”—not all are brilliant entrepreneurs. Instead, they surround themselves with people who possess the needed skills, and then get out of their way.
When considering taking on a failing business, take into account the following:
- Does your particular experience, ability or drive give you an advantage over most others?
- Can you attain something greater from that unprofitable company than you could by using a safer route?
- Can you afford to make an investment in something that might fail?
If the idea of courting the uncertainty of risky business brings out the thrill seeker in you, always exercise good judgment, accept risk and seize upon the quest for adventure and the thrill of high-throttle stakes. Above all, believe in yourself and the potential of your ideas, and you have taken your first steps towards success.
Allen E. Fishman founded business advisory services, The Alternative Board, the world’s largest franchise system providing advisory board and executive coaching services to business owners, Presidents and CEOs. TAB’s worldwide business advisory network operates in over 1,000 cities in the United States, Canada, the UK, and Venezuela.
Fishman is also the author of several books in which he shares his business insights to help business owners, including two best-sellers:
7 Secrets of Great Entrepreneurial Master: The GEM Power Formula for Lifelong Success (McGraw-Hill, 2006) and