The Peter Principle & Entrepreneurship

Simply stated, the Peter Principle is that in an traditional organizational hierarchy, you will get promoted to the eventual level of incompetence.

If you work for a company, you will do well at your job then you are promoted to do another job (or additional jobs on top of what you already do).

This is the promotional cycle.

Eventually, you will get to the point where you are promoted and taking on roles and responsibilities you are unable to do therefore you stop being promoted. Now you are stuck in a role with responsibilities you are incompetent for.

Entrepreneurship on the other hand, is basically the opposite.

You are nothing and you have to learn the role and responsibilities first. Only when you have mastered that role and responsibilities with social proof (i.e. people won't give you money until you can prove you can do it) are you able to try and promote yourself to another level.

Until then, you stay at your level of competence.