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When I founded PK4 Media in 2009 it was one of the most exciting moments in my life. I would pursue my dream. While my title was “Founder and CEO” it took me a little while to fully understand the CEO portion.
I grew up in Silicon Valley and the startup life was second nature to me. Plenty of my friends could rattle off Alex Smith’s career-best stats during the 49ers season that year, but I was busy tracking venture capitalists, valuations, mergers, and acquisitions.
I was very close to some older and successful entrepreneurs who gave me sage advice. Despite that inherent knowledge, I quickly learned that to succeed as a CEO you must exhibit two qualities—you must be a decision maker and a risk taker. And you must do so under the most extreme conditions.
In 2019, there are more people looking to be entrepreneurs than ever before. The allure is hard to deny. From the sidelines, it’s easy to see Cinderella stories of overnight success and overlook the truth: years of hard work, struggle, and failure are behind some of the biggest wins in business. The road to success is paved with risk, and it’s not a journey everyone is willing to make.
So many individuals hear news of massive investments and high-valued buyouts and think, “That’s what I want!” Yet when they consider the risk inherent in making that kind of dream come true, the weight becomes too much. Most people decide to play it safe. A consistent 9-5 workday, and a regular paycheck with a 401K are hard to give up.
Even some entrepreneurs prefer to operate with an added layer of protection when it comes to risk management. Taking on large sums of funding are useful for developing product and services for a business, but it also buys a founding team time to develop their business.
Think about it—with the right amount of funding, a business can operate at a loss for quite a while. Tesla comes immediately to mind. In some cases, this is their business model. Before going public, Snapchat lost $2 billion the two years prior. With PK4, I didn’t want to go that route. I wanted the reward of a profitable business, and to me that was worth the roll of the dice.
Guiding the ship capably means getting comfortable with making tough decisions. Shortly after PK4 launched, I was faced with several make-or-break decisions. That’s what my role as Founder & CEO has become, making the hard choices. Deciding when to add a new product line, when to bring on new vendors and sources that can affect our technology or our clients’ campaigns, when to hire, and especially when to fire. Some of the toughest choices come after the rough patches, which include determining when and how to pivot your business. It took time for PK4 to establish itself as the new model of a media agency.
When PK4 Media started, we were primarily focused on display ads, but as we grew, we were showing results that were multiple times greater than the industry average. We had to make decisions about our new direction. The goal had always been to build out an Omni-Channel platform, but what would our new channel be? I decided to invest in a video content syndication platform; we called it Bishop Video Platform. We wanted to build the next stage in digital video advertising. I invested—risked—company funds to build new technology, develop an ad server, and create an easier way for people to incorporate videos into their marketing mix, essentially developing branded content before branded content became mainstream. This was a huge risk, but it paid off with new advertisers and increased revenue (for them and for us).
As a self-funded company, that decision could have torpedoed the business if it failed. Therefore, risks should not be reckless. The risk we took was an informed one, backed by data, research, hands-on experience, client demand for video, and a gut feeling about the industry. That’s where the thrill of being an entrepreneur (and a CEO) really comes into play: At the end of the day it was up to me to take that leap and say “yes” to the unknown.
I’ve had coworkers who talk about starting their own company but who seem to be inherently risk-averse. Others haven’t understood the value of the equity they could build somewhere. They were happy with commission, but confused about why they didn’t receive a percentage when the companies sold.
There’s nothing wrong with that choice, by the way. It’s a perfectly valid decision. But it illustrates the difference between a successful entrepreneur and a traditional careerist. Some people are happy making predictable, more-or-less consistent money, while others would rather take a chance on creating new products or services that could change an entire industry. Maybe you’ll fall flat and lose everything, but that’s the risk you must be willing to take if you want to see success.
What makes me hungry for risk isn’t just the desire to make money—there’s far more to the reward than that. I’m equally interested in the payoff of helping others, both in the people we hire and develop as part of our team and in the clients we help to reach new heights. I love the concept of creating something from nothing in business; the possibilities are limitless.
It all starts with making that first decision and taking that first risk.
January 23, 2019 at 10:43AM
Forbes – Entrepreneurs