Article written by Jerry Osteryoung

“Only passions, great passions can elevate the soul to great things.” ~Denis Diderot

I give many speeches every year, and in each one I always include time for questions. By far, the most frequently asked question is what attributes are needed to be successful as an entrepreneur.

After observing more than 3,000 entrepreneurs, I can tell you there are three simple keys to success: passion, purpose and knowledge. Most folks have two of these down, but you really need all three if you are going to be successful.

Passion is the burning force that keeps you going no matter what happens. Many of the entrepreneurs we deal with have cash-flow crises, but they just do not quit. Somehow they find a way to make payroll or pay that bill. Instead of getting discouraged, they just make a commitment to never end up in that situation again.

Entrepreneurs who lack passion are almost guaranteed to fail. I have seen many aspiring business owners start a company because they either got laid off or could not find a job. This is a recipe for certain disaster, because not having another option does not provide the pure and unbridled passion that you must have to be successful.

Passion alone, however, is not sufficient. You must also have purpose to be successful, because purpose is the force that focuses your passion on a specific activity or industry.

Too often, people tell me they want to start a restaurant because they are good cooks. Being passionate about being a great cook is OK, but it is the combination of passion with purpose — serving clients and making money, for instance — that makes for success.

The third piece of the entrepreneur’s formula is knowledge. I cannot overstate the importance of knowledge, because this is how you are able to avoid costly mistakes.

There are three critical knowledge areas entrepreneurs must master. First, you must have a great understanding of marketing and feel comfortable promoting yourself and your business. After all, there is no better salesperson for your company than you.

The second is finance. You absolutely must be able to interpret your financial statements and have a clear understanding of the financial ramifications of your decisions.

The third and final element is knowing how to manage people effectively. All businesses need people, and being able to manage those people is a requisite to success. Knowledge takes passion and purpose and transforms that light into a laser beam for your business.

Before you start a business, make sure you have the three attributes that are vital to success: passion, purpose and knowledge. If you are unsure if you have these components, you probably do not, in which case, I would advise you to wait. If, on the other hand, you are sure, now is the time to move ahead.

Jerry Osteryoung is the Director of Outreach of the Jim Moran Institute for Global Entrepreneurship in the College of Business at Florida State University; the Jim Moran Professor Emeritus of Entrepreneurship; and Professor Emeritus of Finance. He was the founding Executive Director of the Jim Moran Institute and served in that position from 1995 through 2008. His newest book “If You Have Employees, You Really Need This Book” is an Amazon.com bestseller. View Osteryoung’s past articles at www.jmi.fsu.edu/Services/Jerry-s-Articles. You can e-mail him at jerry.osteryoung@gmail.com.