Sep
08

Entrepreneurial Planning Blog Topic Two

“Maintaining Control Versus Maximizing Wealth”

(p. 12, The Founder’s Dilemmas)

 

What is more important to your business, control or wealth? That is one question asked by Noam Wasserman’s in The Founder’s Dilemmas. As an introduction into the Founder’s Dilemmas, Wasserman explains core concepts and arguments founders should consider as they embark on their entrepreneurial journey. Wasserman suggest that by gaining insight into what motivates founders for pursuing a start up business allows the business to understand the trade-offs required to grow and paves the way for consistent decision making.   One of the directions to consider involves checking and balancing wealth and control of the business. There are two theories to consider when deciding how to operate your business endeavor. One could develop a “King” outcome resulting in greater control and less wealth. Decisions made to drive this controlling style include remaining a solo founder, hireling witching close personal networks, and guarding the CEO position. One the other hand, one could decide to develop a “Rich” style of decision making. In this “Rich” mindset decision are oriented toward maximizing wealth and imperil control. Hiring from a broad network, taking outside capital, and possibly giving up the CEO positions are examples of decisions a “Rich” oriented founder may have to explore.

So which would you prefer, maximizing wealth or maintaining control over your business? Is control more important that wealth for you and your business? Maybe, it is possible to balance the two for a wealthy and controlled business.

 

Comments

  1. Adam Renkiewicz says:

    One of the key factors you brought up is the option to the entrepreneur. This option is what direction do you want to go. One way isn’t better or worse than it other, its a matter of consequences. What I mean by consequences is you have to decide what is more important to you and stick to that decision because that consistency will create a successful business. The trouble you run into is if you try to be rich and a king, you then run into inconsistent decision making for your business which can ultimately lead to failure.

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