Incentives for new risk-takers

When someone starts a company, it's hard to image the potential pains ahead. Delays, setbacks, failure. Demotivation, exhaustion, shame. How do we create incentives that avoid these very real pains?

How do you make small children brush their teeth? 

Let's check all the usual options:

  • Demonstration and example, by doing it with us and until it becomes a strong hard to break habit. This is the typical approach by parents, and a very strong one. Kids love to imitate their parents. Yet after a while imitation is not enough, especially after a personality begins to develop. Older kids demand validation, or at least entertainment. 
  • Enforcement, by controlling and making it absolutely mandatory to do it. This is also pretty common among families and in sometimes is combined with the first approach. But forcing is lame.
  • Education, by trying to explain the benefits. Education is nice, but lacks the practical experience component.
  • Incentives, by which you reward and therefore associate a risk-mitigating behavior with a reward. While potentially conditioning and fake, incentives help establishing a positive reinforcement. 

Even in modern societies, incentives are not prevalent. Governments make you subscribe to an insurance to cover future health expenses and unemployment, they make you go to school to lessen your dependency on your natural skills, make you pay your taxes because roads make your journeys safer and hospitals make your health issues addressable. They also spread some examples and invest chaotically in education, but not as much as needed. People feel like paying insurance and taxes etc are bad things, and they mildly associate them with getting benefits in the present and future.

With entrepreneurship it's the same. Starting your own company will most definitely bring you plenty headaches in the path to success, and it's hard to avoid feeling shame and sorrow upon failure. Warning entrepreneurs to those risks is ineffective, as they potentially never encountered these problems before. But we can lessen some of that by being active in startup networks, by having mentors who help us, and frequently disclosing and discussing risk among your business stakeholders as well as your personal ones (your family). Like brushing your teeth, it makes your life fresher, more sociable (lol) and avoids spending time at the doctor! Those who are concerned with entrepreneurs should always put forward incentives for this - celebrating their honesty and communication, providing budget (cost and time) for community building and making mentorship pleasant (take your entrepreneurs out to dinner!).

As for my mouth's hygiene, I'm still waiting for a gamified tooth brush, one that gives me rewards for cleaning my teeth frequently and thoroughly! I'd feel like a futuristic kid.