Entrepreneurs come in different personality traits. There are many ways to classify one’s strengths and weaknesses. But one of the most important thing to look for is the balance between Idealism and Realism.
People who are realists, look at present reality. They are grounded to what’s real and logical and very emotionally stable. Such people are also highly analytical. For example, Warren Buffet is a realist. He is very vocal about his inability to be creative and do entrepreneurial things.
Some entrepreneurs like Elon Musk are great idealists. They create a ideal world in their minds and try to achieve things in the real world. He dreams of new products and services and actually gets it done. Though Elon Musk is a great idealist, he is not an extreme idealist.
Extreme idealists are not grounded to reality. They will expect too much from the world and the world doesn’t change as fast as they would want to. Because of this, even though they have the capability to make change in this world, they usually don’t go anywhere towards success. It is like trying to push a boulder with bare hands, because you just want to move it very badly.
Many entrepreneurs make products and then expect people to use them. If people are not interested in that product, the entrepreneur tries to push more marketing budget to convince people that they really need it.
Motorola’s Satellite phone was one such example of extreme idealism. They invested $3 billion dollars into a project to make a satellite phone that can work anywhere on earth. You can call from the Amazon river or the Himalayas. Later they found out that no one really wanted it and people were happy with their existing cell phones. Most of the people do not move out of a regular town or city where there is 100% network reception available for the phones.
As discussed in the previous chapters, it is important to make and sell what people want. If you want to change the reality, do it slowly, being rooted in reality. For example, Elon Musk wants to world to get comfortable with electric cars and moving around major cities in the world in rockets. But he has a proper strategy for it.
Tesla is making electric cars a reality by making it better than gasoline cars. Many electric car companies have tried to convince people to go electric for the benefits of the environment and the future of the human race, but most of the people did not want to buy electric cars because they were not as good as gasoline cars.
As an entrepreneur if you should not be an extreme idealist nor a extreme realist. If you are an extreme idealist, you will not be grounded to reality and will fly off the hook making decisions that do not help you manage the reality of the world.
If you are an extreme realist, you will do better as an investor or an analytical person involved in finance or legal systems. Being an extreme realist comes with its pros and cons. You can see the world for what it is, but you cannot see the world for what it could be.
Entrepreneurship requires innovation and thinking out of the box to stay on top of the market. Extreme realism doesn’t help with that and many people realize that. If you know yourself very well, you will choose a career path where realism helps you rather than hurt you. Being an extreme realist is at least better than being an extreme idealist.
On the other hand, extreme idealists are like mad scientists and they many times over estimate the capability to put a dent in reality and put themselves and their families in financial risk.
There are many sad stories of enthusiastic entrepreneurs burning their savings to start something and then failing. People start hotels, theme parks, invest too much in bad real estate, gamble and then lose all the money they invested.
You should never find yourself in a position like that by being an extreme idealist. If you think you might be an extreme idealist, either try to become more real, or get a business partner who is an extreme realist.
As with anything in life, balance is the way to. When it comes to idealist and realism, the person who can balance it the most will succeed the most as an entrepreneur.