Great Founders — Great Entrepreneurs — know that success requires knowing and working on your flaws. Not just character flaws but preventing a fatal flaw that sabotages success.
Success requires taking a hard look at your flaws. Discover significant types of character flaws and the nature of the fatal flaw preventing success that causes one to fall from the heights of success to the depths of failure.
- Before You Can Be a Great Founder, You Must First Dare
- Know Your Flaws
- Failing by a Thousand Cuts
- The Fatal Flaw
- Five Major Flaws in The Entrepreneur
- The Nature of the Fatal Flaw
- An Allegory on Changing the Mind
- On Site Resources
- Related Pages
Before You Can Be a Great Founder, You Must First Dare
“Some are born great, some achieve greatness, and some have greatness thrust upon them.” Act II Scene 5 of Twelfth Night. — William Shakespeare
If you want to be a manger, work for a corporation. If you want to do something great, be an entrepreneur.
Entrepreneurs who think like a manager will fail. For one thing, you can’t manage a team ‚ you lead a team. You can’t manage change, you learn and you adapt. You don’t manage risk, you face down fear. You won’t always succeed, you will also fail. You never fall back, you need to fall forward. You have to have the courage to DARE.
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If it is Difficult, But its Easier If You Learn To Act Like a Hero
“Anyone can captain a ship in smooths seas. But it takes a great man to guide a ship through the storm.” — Unknown
Know Your Flaws
Despite the best efforts of thousands of universities to prepare their graduates, it’s been estimated that 50% of all careers will derail (Gentry & Chappelow, 2009). It’s cold comfort for many to know that a career train wreck looms for many in the future.
Entrepreneurs also face a difficult road to success. The five-year survival rate of start-ups is at best 50% (SBA, n.d.) & (Robb & Farhat, 2013). This number gets much smaller if you include all the individuals slaving away on business plans that fail to get funded.
Routinely, I asked my students, mostly MBAs, to develop a list of strengths and weaknesses. Some do pretty well and show a great deal of insight. But others show a complete lack of insight. In one case; a student submitted one strength and one weakness. Perhaps when he is 60 years old, and has spent his entire life making continuous improvements to himself, he’ll have one weakness. But this was a young man of twenty-five.
This student is extreme, but what’s more interesting is that unless you have engaged in a serious program of self-improvement, one should always have more weaknesses than strengths.
Sometimes we forget the essential things in life. Being blind to one’s weaknesses is expected, so common that it’s rare to find someone who can clearly articulate in great detail the differences between what they are good at and what they’re not.
Why Ignoring Flaws and Focusing Strengths Often Doesn’t Work
“By failing to prepare, you are preparing to fail.” ― Benjamin Franklin
At one level, it’s tragic to advance to the next level and then have flaws (or a fatal flaw) that cause one to fall back to earth. It’s doubly tragic since rarely is the person blind to these faults — they just choose not to act.
Some people simply say, “Focus on making your strengths stronger. That’s all you need to succeed.” “Yet, even a great entrepreneur like Steve Jobs got fired, and it wasn’t because of his many strengths.”
Of course, one needs strengths. If you are a professional gamer in World of Warcraft, play the clarinet in the band, iron shirts in the launder, wash dishes in a restaurant, or drive a taxi, maybe one strength is enough. Some careers allow you just to have one strength.
You can be a nasty boy, but it doesn’t matter if the only thing you do 10 hours a day is writing code. And maybe you can get through life by being a technologist and just playing on the machine. But don’t expect to be a supervisor, a manager, a team leader, a project manager, an entrepreneur, or an executive. Don’t expect to do anything requiring leadership or management skills.
Remember, Character Flaws Hold you Back
Think about it. We avoid buying flawed fruit in the supermarket, choosing no blemishes instead. You may be able to hide your weaknesses during interviewing, but if you have been around for a while, others know you aren’t executive material. Those with money and power want the best all-around dog in the show, not the one with the best-looking paw.
But managers, executives, and entrepreneurs must never stop working on weaknesses — for these prevent getting to the next level. At some point, we need to pivot and face head-on what holds us back.
Being blind to one’s weaknesses is expected, so common that it’s rare to find someone who can clearly articulate in great detail the differences between what they are good at and what they’re not.
Failing by a Thousand Cuts
“Give me six hours to chop down a tree, and I will spend the first four sharpening the ax.” ― Abraham Lincoln.
It’s been said that you can die from a major wound. But the same can happen if you suffer from a thousand tiny cuts. Originally, the term referred to a type of corporal punishment practiced in Imperial China. Today, it refers to many small causes leading to failure.
Doctors tell us the more risk factors you have, the more likely you will suffer from a heart attack. Likewise, the more weaknesses you have, the more likely you will derail your career. Weaknesses such as:
- Faking attention,
- Agreeing then doing something different,
- Not being open to negative feedback,
- Failing to repair relationships, and
- Not being sincere in apologies (or worse, never apologizing).
Also, remember that the greater your responsibilities, the more small weaknesses are magnified. We might tolerate poor soft skills in a staff engineer, but not in the vice-president of engineering.
If spotting and fixing flaws were just a simple matter of building skills, we could call in the professors and the trainers. But it is not. It involves other factors.
“One can always come up with a thousand reasons not to do something.” —Lyle Johannsen, The Fatal Flaw in the Business.
One might consider a flaw to be a type of entry barrier. Entry barriers exist for a variety of reasons. Some originate from law or regulation, others exist due to the nature of the industry, and still, others are generated by smart competitors to keep new entrants from playing in their ballpark.
It is the fundamental challenge for the Founder to craft a way to go over, under, or around these barriers. For example, one common entrepreneurial wall — getting the seed capital. After all, if you can’t find the money, the red light never turns green, and you are stuck in park.
The Fatal Flaw
A fatal flaw is a bit of a mislabel. It’s usually not just one thing. It’s typically many weaknesses that together cause the person and the business to fail. In some respects, investors act like teachers grading an exam. In grading mode, they don’t care about what’s right; they are obsessed with finding what’s wrong.
Before putting down the money, most investors focus on finding the fatal flaw in the business. Typically this is defined as the factor that won’t make the business model work. For example, in the boom days beginning in 1996 after the Netscape IPO, investors were funding dotcoms based on a business plan—few questions asked. Million-dollar investments are made on the expectation that with eyeballs on the screen come revenues in the pocketbook. Many of them failed, the fatal flaw being the average cost of customer acquisition or a too big to close burn rate.
Investors tend to be pretty savvy in digging around and finding the fatal flaw in the business model. They have all sorts of checklists used during the due diligence process. In addition, legions of accountants, lawyers, and consultants stand ready to point out the many problems in the business plan. But sometimes, the problem isn’t in the business model; it’s within the entrepreneur.
Five Major Flaws in The Entrepreneur
“When you stop learning, you should find a different job.” — Advice the author received from his first mentor.
Weaknesses are often brought up in an interview. Of course, the standard response is to bring up a strength packaged as a weakness. For example, “I’m so highly motivated that sometimes I don’t know when to stop working on a project.”
There are a number of these subtle red flags — entrepreneurial weaknesses that are grouped under the categories of ignorance and skill deficits, inexperience, incompetence, delusion, and single-minded focus.
Ignorance and Skill Deficits
“True ignorance is not the absence of knowledge, but the refusal to acquire it.” —Carl Popper.
Founder ignorance is not on most peoples’ list of why you shouldn’t invest, but it’s on mine. Of course, you cannot know everything you need to know to run a business. Still, it’s not the lack of knowledge critical—it’s the refusal to acquire it.
It’s incredible how few founders consider sales a necessary competency. I suppose in some cases; the app does sell itself. And you might have an e-commerce site that functions in perpetual income-generating mode. But even then, you can’t go wrong by having persuasive skills to influence those pesky stakeholders.
Another problem—one can know but not do. Let’s call this the problem with professors. Professors are brilliant and they are book-learned. As a result, they command a great deal of useful (and useless) information. But many cannot apply what they know. Two examples: entrepreneurial professors rarely run their businesses and teaching medicine differs from practicing it.
Bankers are fond of saying that a business fails when it runs out of money. True, true. But money is an effect, not a cause. Over the years, many studies have looked at the cause(s) for running out of money. Results vary widely depending on the industry and how researchers frame their questions. However, it’s worth remembering one study done many years back.
Incompetence doesn’t just exist in new businesses; it also creeps into long-established ones. Peters (1996) referred to this as The Peter Principle. The short version goes, “In a hierarchy, every employee tends to rise to his level of incompetence.”
The rule applies to all levels of the hierarchy, from the very top to the bottom. It’s easy to see janitorial incompetence when the floors aren’t being swept, and the trash isn’t taken out. But it’s hard to know when a CEO is incompetent. Even when this becomes common knowledge, they often leave with their firms’ golden parachutes (Kloeffler, 2012). Not a bad job if you can get it.
Big companies can muddle through with a bad CEO or two. However, an ignorant, inexperienced and incompetent entrepreneur is cancer inside a small-medium enterprise—one fatal to growth.
If you still don’t think this is a problem, you should look closely at a series of experiments in psychology that came to be known as the Drumming-Kruger Effect. In a Psychology Today article by Hawes and Grazioplean (2010), the Dunning-Kruger Effect is described as “A cognitive bias in which people perform poorly on a task but lack the meta-cognitive capacity to evaluate their performance properly. As a result, such people remain unaware of their incompetence and fail to take any self-improvement measures that might rid them of this ineptitude.
We also see some weaknesses embedded within strengths. Usually the flaw is one related to single-minded focus, which the psychologists can functional fixedness. It’s like looking at a rainbow and only seeing the color green. Some examples:
The Extreme Manager. Typically, an MBA deludes himself into thinking that entrepreneurs are just managers and that they can manage the business into a success.
The Technologist. This is the inventor who thinks that the product will sell itself. The flaw is related to an old saying by Ralph Waldo Emerson, wrote in his journal in 1855. It goes, “If a man has good corn or wood, or boards, or pigs, to sell, or can make better chairs or knives, crucibles or church organs, than anybody else, you will find a broad hard-beaten road to his house, though it is in the woods.” However, there is another version by Sarah Yule that goes, “If a man can write a better book, preach a better sermon, or make a better mousetrap, than his neighbor, though he builds his house in the woods, the world will make a beaten path to his door.”
Unfortunately for the inventor, their inventions may not pay off economically as the following example from (Hope, 1966) illustrates, “Of the more than forty-four hundred mousetraps patented, fewer than two dozen have earned their creators a cent.”
Character flaws. Historians have well documented those who fell from power due to personal failings. Hubris, for example, was a fatal flaw in the tyrant, one of the more common reasons for the fall of the powerful back to earth. Wannabe entrepreneurs who are not coachable suffer a similar flaw. Unfortunately, there are many character flaws, including personality disorders such as extreme narcissism.
Delusion is a strange thing. The Buddhist definition—is a false belief that causes suffering. Unfortunately, this type of delusion is not crazy, odd, or unusual—millions can hold it. What’s worse, strong delusions resist being changed. Many are learned in families, but a surprising number originate in universities.
The best way to understand entrepreneurial delusions is to know how they are taught. Those without college degrees just figure it out. Others with technical degrees such as computer science also figure it out.
Still, others take entrepreneurial courses at a university, thinking the professors have the answer. But, unfortunately, many do not. One reason is that professors lack feedback on what works and what doesn’t since only a small number of full-time faculty have ever run a business. As a graduate student I worked for a professor who had his small business textbook up to the 7th edition — and he never bothered starting a business.
Textbooks present another problem. Of three commonly used textbooks I examined (Katz and Green, 2011), (Mariotti and Glackin, 2010), (Timmons and Spinelli, 2008), none of them emphasized the importance of building entrepreneurial teams. Nor did they tell students how to do so. And none of them addressed the importance of personal improvement in evolving into a Great Founder.
The Nature of the Fatal Flaw
The Fatal Flaw is a term used for a significant weakness, or more commonly, several weaknesses that brake forward progress on the journey of life. Rather than having one foot on the accelerator, it’s as if the other foot is on the brake. No matter how much energy you put into growing forward, something slows you done.
Sometimes it’s easy to see, as in the case of hubris and arrogance. Hubris is defined as excessive pride or self-confidence, while arrogance is overbearing pride, an offensive display of superiority or self-importance. You might say both of these thrive among incredibly selfish narcissistic individuals.
But many times, the flaw is hidden and difficult to discover. For example, in the syndrome known as the fear of success, the person sabotages their career progression in subtle and not-so-subtle ways. Let’s say one desires a high political office but secretly believes they are not ready or deserving. So the person throws away the opportunity by making a series of political gaffs that gives the election to the opponent. Don’t laugh; it happens.
If only the fatal flaw were just an anger problem, a listening issue, or a coachability deficit. But most of the time, there are many small things, all of which contribute to careers derailed or businesses lost.
Do not be deluded, a high I.Q. does not make you immune to character flaws that can crater a career or destroy a business. Do not think that just because you are a graduate of the university and have a Ph. D, masters or bachelor’s, a “Fatal Flaw” might not exist.
Sometimes called the Tragic Flaw, it has long been a part of human nature, captured in literature, myth, and movies. We also see this today when people get fired due to problems they didn’t know they had. Or, in an actual tragic flaw, they knew they had issues but failed to do anything about it.
I saw this happen. A brilliant programmer unwisely took a step up into management. Bad people skills combined with a hefty dose of passive-aggressive personality led to him leaving the company, despite the organization giving him six months of coaching.
The Fatal Flaw is a term used for a major weakness, or more commonly, several weaknesses that brake forward progress on the journey of life. Rather than having one foot on the accelerator, it’s as if the other foot is on the brake. No matter how much energy you put into growing forward, something slows you done.
Sometimes it’s easy to see, as in the case of hubris and arrogance. Hubris is defined as excessive pride or self-confidence, while arrogance is overbearing pride, an offensive display of superiority or self-importance. You might say both of these thrive among incredibly selfish, narcissistic individuals.
But many times, the flaw is hidden and difficult to discover. Still, these must be found and changed. For example, in the syndrome known as the fear of success, the person sabotages their career progression in subtle and not-so-subtle ways. Let’s say one desires a high political office but secretly believes they are not ready or deserving. So the person throws away the opportunity by making a series of political gaffs that gives the election to the opponent. Don’t laugh. It happens.
If only the fatal flaw were an anger problem, a listening issue, or a coachability deficit. But most of the time, there are many small things, all of which contribute to careers derailed or businesses lost.
An Allegory on Changing the Mind
“Criticizing another’s garden doesn’t keep the weeds out of your own.” —Unknown Author.
You might say your mind could be like a garden—a wonderful place where beautiful things could grow.
But faults are the weeds in the garden out the mind; they obscure the beauty waiting to be revealed.
For the vast majority of people, their mind is more like a swamp, a jungle, and a wilderness. The weeds have grown over the years, seeded by trauma, harmful states of mind, negative emotions, and delusional beliefs. Ignoring these weeds crowds out the flowers. And if you continue to engage in willful blindness, you have nothing of beauty.
Finding your flaws is like acting as a gardener who keeps pulling out weeds and engages in planting flowers of flowers such as the virtues, positive states, empowering beliefs, and though effort transforms wilderness into something beautiful.
It requires daily action to make these types of fundamental changes. You won’t finish in a week, in a month, or even in a year. You may never end—but you need to try.
“The beginning is the most important part of any work.” — Plato
Sooner or later, everyone faces a fundamental truth — that to succeed in business, one must work on their weaknesses.
On Site Resources
Gentry, W. A., and Chappelow, C. T. (2009) Managerial derailment – weaknesses that can be fixed. In Kaiser, R. B. (Ed.), The perils of accentuating the positive. Tulsa, OK: HoganPress, 97-113.
Goins, Jeff (N.D.) Heroes and Their Tragic Flaws: Achilles to Bethany Hilton.
Hawers, Daniel and Grazioplen, Rachael (2010). When Ignorance Begets Confidence: The Classic Dunning-Kruger Effect. Psychology Today, June 6.
Hope, Jack (1966). The Better Mousetrap. American Heritage Magazine, 47:6
Johannsen, Murray (2014). For A Change. Available exclusively on Apple for iBooks and iPads
Katz, Jerome & Green, Richard (2010). Entrepreneurial Small Business. McGraw-Hill Irwin.
Kloeffler, Dan (2012). Golden Parachutes: 21 CEOs Landed $100M Plus.ABC News, January 27.
Mariotti, Steve & Glackin, Caroline (2010). Entrepreneurship, 2nd Edition, Prentice-Hall.
Peters, Lawrence & Hull, Raymond (1996). The Peter Principle: Why Things Always Go Wrong, Buccaneer Books.
Robb, Alicia & Farhat (2013). An Overview of the Kauffman Firm Survey, The Kauffman Foundation.
Small Business Administration, Office of Advocacy (N.D.). Frequently Asked Questions. http://www.sba.gov/sites/default/files/sbfaq.pdf
Timmons, Jeffry and Spinelli, Stephen (2008). New Venture Creation: Entrepreneurship for the 21st Century, McGraw-Hill Irwin
Wan, Khoo Ee and Tham, Caithlin (2010). Understanding Managerial Derailment. Singapore Civil Service College.
First Published: March 2014 ; Last Update Oct, 2022