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What does it take to be a serial entrepreneur?

Serial entrepreneurs are a distinct subset of entrepreneurs; creating and building a successful business, not once but multiple and even dozens of times.

Across our research sample, just over one in three entrepreneurs are serial business owners; this figure rises to almost one in two in the UK and UAE. But why do something so hard again and again? What motivates them? What unique challenges do they face? And what differentiates them from mono-business entrepreneurs?

One driver is these are often people who enjoy the excitement if starting something new. “For many of them, it’s the journey, not the destination,” says Jeremy Franks, Managing Director, Head of Wealth Planning and Advisory, UK & EMEA at HSBC. They love starting up and growing companies, and look to the next challenge once the business matures. “These people love the excitement and challenge of founding something new,” he adds.

If this is one driver, another motivator is family dynamics. Nearly two thirds of entrepreneurs in the survey (which was undertaken by Ipsos for HSBC Global Private Banking) cited this as a reason for starting multiple companies. This figure rises to three quarters (74% ) for multi-generational entrepreneurs (those who are at least the second generation to lead the family business). This suggests that having been “born into” the business many feel the need to prove themselves. Responses in the qualitative responses support this, with entrepreneurs citing the need to do their own thing and show that they can run a business independently of the family.

Interestingly here, there is a related reason that first-generation entrepreneurs will take a second, third or fourth bite of the cherry. This is that a single business success could be luck and they feel a need to demonstrate that it wasn’t. “It’s a badge of honour,” says Franks. “Once might be a fluke. But if I can do it multiple times, then that's down to me - so there’s a degree of psychology involved.”

of entrepreneurs said that “innovative ideas and identifying a gap in the market” as a motivation for serial entrepreneurialism.

56% of entrepreneurs said that “innovative ideas and identifying a gap in the market” as a motivation for serial entrepreneurialism. This plays strongly to the idea of the serial entrepreneur whose real passion is not any one company; rather it’s the search for the next big thing. Roland Emmans Head of UK Technology Sector & Growth Lending at HSBC says, “These are people who are always on the lookout. They’re constantly thinking, ‘There’s going to an opportunity here’ or ‘I could do that better.’ I see a lot of this - many entrepreneurs are forever on the hunt for something new.”

Serial entrepreneurs like this are often more interested in founding and building companies than they are in running and managing them. They may start companies with one eye on the exit a few years down the line. “These entrepreneurs are very good at going from stage one to three quickly.” says Franks. They often recognise this and will quickly install professionals to manage the company once it reaches a certain size. He adds, “If they’ve been doing this for a while, they will often have trusted teams or people they can put in.”

Serial entrepreneurs are always on the lookout. They’re constantly thinking, ‘There’s going to an opportunity here’ or ‘I could do that better.

Roland Emmans Head of UK Technology Sector & Growth Lending at HSBC

Serial entrepreneurs, says Emmans also tend to have a strong idea of what their strengths and weaknesses are and play to former while talent spotting for the latter. “They know what they’re not very good at and they'll wrap people around them that are better than they are at these things.” 

For obvious reasons, entrepreneurs like these tend to be less emotionally attached to a single business than their mono-entrepreneurial counterparts. They are also markedly more likely to expand into different sectors (because opportunities are everywhere). Sixty-three percent of serial entrepreneurs operate in more than one sector, against 17% of singles. Interestingly along with obvious drivers for multi-sector expansion (such as finding new challenges and exploiting new ideas), serial entrepreneurs also cite the desire build wealth and financial freedom.

We’re seeing more family offices encouraging the next generation to go off and set up their own business

Jeremy Franks, Managing Director, Head of Wealth Planning and Advisory, UK & EMEA at HSBC

If some serial entrepreneurs are motivated by having inherited a business, they are also concerned about what they leave and are more interested in passing companies on than single business entrepreneurs (35% vs 30%). However, says Franks, entrepreneurs generally are pushing their children to go serial, perhaps before they take over the family firm. “We’re seeing more family offices or quasi-family offices encouraging the next generation to go off and set up their own business, so they’re almost acting like family entrepreneurial incubators.”

Roland adds that whatever serial entrepreneurs plan for the next generation, thanks to their innate characteristics they tend not to be very good at hanging up their own hats and retiring. “There are very few serial entrepreneurs I know that when they retire, go and put their feet up. Rather, they have a bit of time off and then throw themselves wholeheartedly into either another business or something completely different.”

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