Becoming a successful entrepreneur is not easy. I spent five years studying 177 self-made millionaires and I have to say, the entrepreneurs in my study were among the most courageous, fearless individuals I have ever met. They put everything on the line. They took enormous risks in the pursuit of their dreams.
If you want your children to grow up to be entrepreneurs, then there are certain things you can do as a parent to help tee them up to be an entrepreneur.
Raise Your Kids to be Optimistic
Optimism is the greatest asset of every successful entrepreneur. Sixty-seven percent of the self-made millionaires in my five year study on the daily habits of the rich were fanatical optimists. While they expected the entrepreneurial journey would be long, hard and filled with setbacks, they also believed they would survive that journey and, in the end, succeed. Raising kids to be optimistic gives them an enormous advantage over everyone else they will be competing against as adults because that optimism enables them to power through intractable hurdles, pitfalls, mistakes and failures. Those who have the most optimism also have the greatest persistence. And persistence is a prerequisite for success.
Fund a “Kid Start-up”
Successful entrepreneurs start businesses and then grow those businesses. Along the way they make mistakes, have to overcome obstacles and sometimes fail. The best time to make mistakes or fail is when you’re young and you have very few responsibilities such as a home mortgage, children to raise and bills to pay. Here are some “Kid Start-up” ideas:
- Open a neighborhood lemonade stand.
- Sell hand-made friendship bracelets.
- Start a rock band.
- Have a garage sale and put your child in charge of selling and collecting money. Give them a commission on each sale – 20%, for example.
- Open a home-made ice cream stand.
- Sell floral arrangements.
- Sell personalized head bands, scrunchies, hats or shirts.
- Sell knitted scarves, gloves, socks, etc.
Parents can help fund the “kid start-up” and watch their child gain valuable entrepreneurial experience.
Teach Your Kids the Difference between Good Goals and Bad Goals
Successful entrepreneurs set goals that help them realize their dreams. They also know the difference between a good goal and a bad goal. You hardly ever hear anyone talk about goals in a negative context. Goals are almost always perceived to be good. But I found from my research that there are goals that add no real value to your life when achieved. So how do you know what type of goals to teach your future entrepreneur?
Good goals create long-term benefits and long-term happiness when achieved. They allow you to grow as an individual and alter your behavior in a positive way. Good goals get you from point A to point B. Point B being a better place, such as more wealth, a better job, higher income, etc. An example of a good goal would be to lose 20 pounds. Setting a weight loss goal often involves a daily regimen of exercise, healthy eating and encourages a healthy lifestyle. Good health results from exercising and eating right. It may also motivate you to moderate your consumption of alcohol or to quit smoking. When the weight eventually comes off you enjoy the compliments, feel healthier and all of this creates lasting happiness.
Bad goals create short-term happiness and no long-term benefits when achieved. An example of a bad goal would be to own a Ferrari. In order to own a Ferrari you must make more money. Making more money will likely involve either more work or taking excessive financial risk (i.e. gambling). There’s a cost-benefit to working more – you invest time that you will never recoup. Don’t misunderstand me here. Working more to make more money can be a good thing. But where the goal goes south is when you then use that money to buy stuff, like a Ferrari. The happiness you derive from owning more or better stuff will fade over time, since happiness derived from buying stuff is always short term. You will eventually revert back to your genetic happiness baseline and, after a few weeks, the Ferrari will no longer create lasting happiness. The lost time, however, can never be recouped. If the goal, instead, was to judiciously invest that extra money you earned into a calculated risk, such as a side business, an investment or a vacation home that would enable you to spend more time with your family, then it transforms the “work more/earn more” goal into a good goal.
Help Your Kids Discover Their Unique Talents
We all have certain innate talents that are unique only to us. Unfortunately, most of us never find out what those talents are. As a result, when we become adults, we find ourselves stuck in jobs that don’t allow us to utilize our individual talents. This creates unhappiness in our lives and a feeling of being stuck.
Where parents fail most often is in pigeon-holing their kids into two or three activities, typically sports activities. How can a child ever find out where their talents lie if they are limited to two or three activities?
There’s a solution. Every six months expose your children to a new, novel skill-based activity. This could be the school newspaper, or it could be joining the drama club, or band club, or music program, art club, debating club, etc. Let your child experiment with something new every six months. You’ll know when your child has found something they are good at and like because they will want to continue engaging in that activity. You won’t need to force or prod them to continue the activity.
Service to Others Doctrine
We humans are by nature focused and obsessed with our own lives. When someone comes along and shows a sincere interest in our interests, who puts us first, we melt like butter on a hot stove. The key to building strong, long-lasting relationships is to fight the urge to focus on ourselves and our life and, instead, to focus on the interests, needs and wants of others. When you teach your child about the Service to Others Doctrine it will help them win over almost anybody in life. In the success game, relationships play a critical role in opening doors that would otherwise be closed. If you want to win that game, you need to play by the rules. When you teach your child the Service to Others Doctrine you are teaching them one of the fundamental principles to success.
Enroll Your Child in Mistake University
Mistakes are beautiful things. They not only teach you what doesn’t work, they teach us what works. Mistakes are critical to the success of all entrepreneurs. Parents who want to raise future successful entrepreneurs need to teach their children that mistakes are good things and not bad things. There’s a tool you can teach your child to do just that. I call it the Mistake Binder. The Mistake Binder is a running list of every mistake you make in life. Each mistake is documented on one page. You want to document four things on that one page:
- WHAT went wrong
- WHY did it go wrong
- HOW to avoid repeating it in the future
- LESSON you learned
The goal is to get your child in the habit of filling their Mistake Binder with page after page of mistakes that they make. Then have your child spend a few minutes every other week reviewing their Mistake Binder. This helps make the learning stick and will also keep the mistakes in their working memory, acting like a radar system, alerting them when they are about to repeat a mistake. The Mistake Binder will take the taboo out of making mistakes for your child and will change their negative perception regarding mistakes. They’ll soon find themselves thinking like entrepreneurs, who embrace mistakes and the lessons they teach.
Teach Your Future Entrepreneur the Importance of Seeking Out Mentors
The 177 self-made millionaires in my Rich Habits study who found a mentor, cut their path to becoming rich down from 32 years to 12 years. And, even more important, they accumulated nearly two times the average wealth ($7.4 million vs. $3.4 million) of other self-made millionaires in my study who had no mentor in life. Granted, it’s not easy finding success mentors. But if you don’t look, you will not find.
Teach your kids the importance of seeking out those who can help them succeed. Successful entrepreneurs, believe it or not, are only too happy to help others succeed. And that includes your child. Those who have made it in life, desire to share their knowledge with other success-minded people. Many high schools around the country have a program called DECA. Have your child enroll in this program. They will find entrepreneurial mentors there and also other success-minded students who they can develop long-lasting relationships with.