Challenges of Second Generation Entrepreneurs

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The greatest intergenerational transfer of wealth in history will occur in the India over the next decade.

An estimated 200,000 Crore Rs is expected to change hands (Milagrow Estimates)

One thing is sure - second generation entrepreneurs will hold the economy of this country in their hands for many years into the new millennium

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In a family business, it's the third generation that presents the big problems. The first generation founds the company and has the drive and the dedication to move it forward. The second generation rides that wave. The third generation wants to do their own thing. They've seen Broadway; they've had all the advantages.- Gale Petronis

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I hadn't planned to go into the family business. I was at an age where I wanted to go save the world. But at that point, I realized I had an opportunity to help my family rather than chase after a bunch of idealistic dreams. I made that commitment, and I haven't looked back.~ Clark Kepler

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The world facing second generation entrepreneurs is more complicated than the one in which our parents had success.

Technology, competition, and workforces are ever changing in today’s business environment and make up some of the most difficult challenges for “new” entrepreneurs.

Couple these issues with the fact that the founder may still be actively involved and the job of running a family business by the second generation becomes monumental.

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Solo operators-who work alone or have a few employees.

Active partners-who are basically solo operators and have partners to contribute money to the business without actively participating in it.

Partners-who are those entrepreneurs who carry on the enterprise as a joint activity, all of them actively participating in the business of the firm.

Types of Entrepreneurs

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Investors-are those who are creative and inventive, like to invent new products and may need to setup a business to make them commercial and market them.

Challengers-are those entrepreneurs who get into business because of the challenge it represents.

Buyers-who tends to purchase business rather than start one itself, as it appears to be less risky.

Life timers-who sees their business as integral to their life.

Types of Entrepreneurs

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I think I know I've been working very hard for the family business, and sometimes those days are long days and you know I think if I know I'm working hard and I'm pulling my weight both work and playing hard at the same time, you know I think everyone who I work with can see I am there pulling my weight and that's really what matters to me – Kate Middleton

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You must take risks when appropriate and follow through with diligent work.

I think the most important CEO task is defining the course that the business will take over the next five or so years. You have to have the ability to see what the business environment might be like a long way out, not just over the coming months. You need to be able to both set a broad direction, and also to take particular decisions along the way that make that broad direction unfold correctly.

Create your own fate

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Be it in the marketplace, industry, or technological advances, if you stop learning, you will lose your competitive advantage and inevitably fail in your business. You must learn and adapt accordingly to keep up with the competition and customer demands.

Information technology and business are becoming inextricably interwoven. I don't think anybody can talk meaningfully about one without the talking about the other – Bill Gates

Never stop learning

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“Nothing just happens.” You have to work hard, keep your goals in mind and endure seemingly thankless tasks by motivating yourself through a variety of sources including inspirational tapes, newspaper clippings or supportive friends. The ultimate benefit to keeping yourself properly motivated is that you can motivate others to aim higher.

Everybody makes business mistakes. I mean, I take the responsibility, and I did. I was the captain of the ship and I took that responsibility.

Motivate yourself

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Many people will sit in a meeting and keep their ideas to themselves, dismissing them as silly, only to hear someone else generate a lively discussion by voicing the same ideas. You have to trust your instincts.  Everyone should pay attention to their gut.

I never get the accountants in before I start up a business. It's done on gut feeling, especially if I can see that they are taking the mickey out of the consumer – Richard Branson

Trust yourself

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You have to conduct yourself in the same way you present yourself. Company mottoes and mission statements must be reinforced through actions. If not, associates, employees and customers will be skeptical of the overall organization and rely  exclusively on self-protection rather than developing a mutually beneficial relationship.

Ethics or simple honesty is the building blocks upon which our whole society is based, and business is a part of our society, and it's integral to the practice of being able to conduct business, that you have a set of honest standards. And it's much easier to do business with someone when you look them in the eye and say, "This is what we're going to do," and you understand what you each mean, and you can go away and get it done – Kerry Stokes

Live your values

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Entrepreneurs have a reputation for being self-centered, possibly because they are so focused. But when we look around, we see entrepreneurs’ names on business schools, research grants or even Hospitals. This helps a business too. By being involved in non-profit organizations, you can be nominated to corporate advisory boards. That kind of “giving back” creates a personal reputation that is indisputable

To me, money is a means to do good. I reached a point in my life where I had enjoyed tremendous business success that afforded my family everything we could possibly want- Eli Broad

Give something back

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Intrapreneurs are enough like entrepreneurs to make top management nervous, because of the unsettling myths about the entrepreneurial personality. Contrary to prevailing opinion,

1. Entrepreneurs are driven by a need to realize their vision, not a desire for wealth 2. They work to minimize risk in order to realize their goals 3. They follow both intuition and hard analysis 4. They are honest with themselves and others and 5. They do not have a need for power. They are, in short, worthy of freedom and responsibility.

Encourage Intrapreneurs

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Identify the best and brightest employees. Identify the strengths and weaknesses of the star employees. Ask the at-risk employees--those most likely to leave--to come up

with ideas that might allow them to stay. Give them the chance to sell on their plans. Support these ideas in any ways the organisation can. Find ways to

make employees even more excited about their own ideas, and they'll want to stay.

Identifying Intrapreneurs

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