Luck of the entrepreneur

Oil billionaire J. Paul Getty had three rules for business success: get up early, work hard, find oil. He had a good point. Luck accounts for the difference between success and failure in business and economics more often than we think.

But while many business owners are nervous about the idea of luck and can become suspicious when “lucky” opportunities present themselves, there is a growing brand of entrepreneurs, academics and thinkers dedicated to the idea that business owners can actually create and manage luck.

It’s not only about taking chances, but about getting out and meeting more people, sharing ideas and not being frightened of wandering off the beaten track.

Michelle Mathews, who runs the successful Deck of Secrets guides for shopping, cafes and other cultural interests, has had lots of luck. But much of that, she says, has come from bad luck.

A former flight attendant with Ansett, she was dabbling in publishing in 1998 in the years leading up to the airline folding. Her lucky break came when she was made redundant.

“If that hadn’t happened, my publishing company would have limped along and I would have been increasingly frustrated staying at Ansett,” she says.

“To have the rug pulled out from underneath you at some stage is usually a good thing. Some of the best opportunities I have had have been born out of misfortune.”

Along the way, there have been some lucky breaks. Deck of Secrets, for example, has been turned into an iPhone app after she was approached by a developer. A chance meeting turned into a great business opportunity. But then, she was approached because she had been dabbling in mobile technology. And whereas others might have walked away, Matthews seized the opportunity.

Creating good luck, she says, is about noticing and taking opportunities.

“As an entrepreneur, you always have your mind switched to looking for things and observing opportunities. Just by being visible, you get approached by people who have ideas who want to work with you.”

That often means taking risks, and some opportunities don’t work out. Matthews says it all comes back to attitude. She says she is careful with commitments and that her business is flexible enough to ensure risk mitigation.

“I outsource everything so that if something goes wrong and is unpalatable, I will steer the business in a slightly different direction. I am not wedded to a fixed infrastructure or employment structure. Most other companies would deal with long lead times and inflexible structures so that it is difficult for them, even if they spot an opportunity, to act on it.”

She says that lucky chances come from getting out and meeting more people. The more different they are, the better it is as this can provide unexpected opportunities. It’s a skill, she says, that hones the mind and preparedness to take chances.

“If you do lots of maths problems and language problems, you will expand the neurons in your brain, it’s that kind of thing. It’s pretty easy to stick to the same routine but nothing is going to come of that. The more you get out, the more you see things.”

A lucky attitude

David Austin, who runs the entrepreneurship and creation of new business course at Melbourne Business School says luck is a misunderstood concept. It’s about attitude.

“A lot of what looks like good luck is that capacity for noticing opportunity,’’ Austin says. “It tends to involve divergent thinking.”

“Pretty frequently, for example, you will hear repeated stories of people who started a business and they were weeks or even hours away from having to close the business. Then something happened and they continued. But when you take a closer look, you will see that as disaster loomed closer and closer, it in fact encouraged them to change their behaviour in a significant way and it was their changed behaviour that made the difference.”

“It’s not about creating luck,” he says. “What you are really doing is having the capacity to notice it and to notice its early seeds. It looks like you created it, but you haven’t really,” he says.

Entrepreneur Ziggy Pyka has had extraordinary luck. Fifteen years after arriving in Tasmania and setting up a ginseng business, his company 41 South has gone from nowhere to success after success. It targets Asian markets and its ginseng is now infused in vodka and gin, chocolate, nougat, honey as well as a herb and spice mix for cooking. The company, tucked away in Deloraine, has been featured on national TV.

Pyka says luck is only part of the story. “Luck doesn’t come about by itself, you have to make it,’’ Pyka says. “You actually have to make decisions. I don’t believe in Lotto.”

He says the key is to stay positive and to take calculated risks. Setbacks are inevitable but they offer valuable lessons. “Bad luck is just setbacks. You look at it, you think about why it happened and you solve it.”

Some entrepreneurs are nervous about pursuing luck but Pyka says that always boils down to the business model. “In the business world if you start a business and in the first year, you don’t have a good return, then it’s seen as not a good business. I see it differently. If you want to do something, even if it doesn’t bring you much return at the beginning but you can still make a living out of that, you have to pursue it.”

Business consultant Jason Bresnahan specialises in luck. Apart from running a regular blog, The Pursuit of Luck, he takes clients through “luck pursuit sessions” where they identify opportunities.