Archive for December, 2015

Cry Havoc: Where Have All The Risk Takers Gone?

December 20, 2015

Small business leaders are by nature risk takers.

They jump off a cliff with a new venture and hope a swimming pool is there to break their fall.

Small businesses are rife with successes and failures but they all seem to have launched with the knowledge of risk inherent in any new venture.

But in today’s world risk takers are few and far between in other sectors.

The recent sell off in the high risk corporate bond field comes quickly to mind.

It demonstrates the herd mentality that seems to be afflicting many non-small business leaders.

Monies poured into “high risk” funds offering on average 553 basis points by putting funds in junk-level corporate bonds and assets.

One company recently said it was going out of business and not returning funds until they got better prices for the bonds and assets.

This has set off a run on these funds and their assets.

Big pharmaceutical companies are being assailed for buying smaller start-ups and at the same time for not beefing up their own research.

Both of these action plans have risks and it seems many pharma leaders are straddling these avenues.

The past seven years have not been kind to American business and it is natural for leaders to become risk adverse.

Two recent studies showed that employers were:

  1. Looking to higher specific talents for specific roles.
  2. Many seasoned executives are being squeezed out when their talents are most needed.
  3. The love affair for young entrepreneurs is waning.
  4. The second internet bubble may be finally busting.

Both studies and Information Strategies, Inc.’s own soundings suggest that business leaders are suffering from a severe case of risk aversion.

But the good news is that small business leaders are still starting and growing their own enterprises at a record clip. This is happening even as overall optimism is below pre-recession levels.

Life is a risk and those who accept the challenges are usually the winners.

So as Shakespeare said: “Cry Havoc, and let slip the dogs of war.”