Victoria Beckham has been named Entrepreneur of the Year by Management Today. She topped their list of 100 successful entrepreneurs thanks to her fashion company’s turnover, which has grown from £1m to £30m in the past five years, and its employment growth, which has grown from three members of staff to 100 in the same time.
Some might scoff at her selection, believing that she is only successful as a result of her fame as a Spice Girl and as David Beckham’s wife, or that she was only selected to attract headlines. While her selection likely resulted in more press than the award would have otherwise, both industry and research readily support the two indicators for which she won the award as worthy markers of business growth.
And, while Victoria Beckham has certainly benefited from her fame outside her business, this is not grounds for dismissal. In fact, we often tell budding entrepreneurs to capitalise on their resources – personal, financial and social. So why should we fault her for doing that? Creative performance and success is best judged by those in the field and her company’s work has garnered respect from other fashion designers and critics – not the easiest bunch to impress.
Performance indicators and accolades aside, her discussion of business practices in interviews indicates that she fits the entrepreneur role much more than some may think. So if you are a wannabe entrepreneur, there are some lessons we can take from her transition from pop star to business executive.
1. Use Your Personal and Social Capital
A review of different ways that new ventures can establish legitimacy and gain resources shows that the founder’s past experiences can provide legitimacy to the business and improve its ability to obtain resources. Status, connections (with people and organisations) and social capital can all contribute. Victoria Beckham made use of both support from friends in the industry and the fashion world’s perception of her as a fashion icon.
She might not have had designer status, but she used her social capital effectively, and built her status slowly through collaborations and licensing. She also raised her profile in her first year by meeting one-on-one with press, buyers and critics to personally explain her designs and vision, demonstrating that she was not just a figurehead, that she was directly involved in the designs.
For those not starting out with Beckham’s level of fame and capital, business accelerators, incubators and other communities of entrepreneurs not only offer opportunities to collaborate, network and learn from experts, but can also offer increased perceptions of legitimacy and a chance to build social capital, which may help improve your access to resources.
2. The Importance of Experience
While having a creative idea is important at the outset of establishing a business, it is the practical intelligence, or everyday “know how,” of the entrepreneur and their team that determines if that venture will grow. A recent study demonstrated this. It showed the importance of practical intelligence in entrepreneurship, developed through experience in the industry and in starting new ventures, for tackling the daily challenges that emerge as the company begins to grow. Practical intelligence is more than just technical expertise, it can include an understanding of the customer, the environment in which the business operates and how to solve common problems in that field.
