I have a friend who constantly gets himself into trouble. He broke his ankle jumping off a high wall. He got drunk and drove the car off the road, taking away his driver's license. (He's lucky it wasn't worse.) The number of injuries he's sustained in the time I've known him is more than the most careful people accumulate in a lifetime. I tell this fellow that he's “too brave for his own good,” but really, that's being overly generous. My friend is not brave – he takes unnecessary risks.

Entrepreneurs are often praised as risk takers, perhaps because of the number of entrepreneurs who link these concepts together. Bill Gates famously said: “To win big, sometimes you have to take big risks.” Howard Schultz instructed others to “risk more than others think is safe. Dream more than others think is practical.”

But as my friend and his actions show, there is a difference between being a risk taker and being brave — and only the latter is necessary for entrepreneurs.

Related: You will fail at risk taking if you don't follow these 5 strategies

Risk taking versus bravery

There is a difference between taking risks purely for thrills and taking risks achieve something.

It is true that people tend to take risks when there is a great reward at stake, a fact EXPLORING by marketing professors Derek Rucker and David Gal. It turns out that while people often like to think of themselves as brave, they usually reserve risk-taking for times when there are significant benefits to be had. “Courage is not just taking risks,” the professors write. “It is the facing of fear in a task that is related to a higher-order goal or that is meaningful to the individual.”

I agree: My wall-jumping friend is something of an anomaly, since there wasn't much to be gained by doing that particular jump. I consider myself relatively risk-averse, but I also understand that it takes courage – and no small amount of self-belief – to spend time building a business when you could be doing something else.

For entrepreneurs, I agree with a take IN Harvard Business Review that founders are not inherently more risk-positive; we just define risk differently. For some, the risk of NO pursuing an entrepreneurial path is somehow greater than taking the so-called safer option. This was certainly true for me, especially the way I did it. Bootstrapping it allowed me to monitor the success of my business, Jotform, and grow in line with market demands. I didn't quit my day job until my startup became profitable enough to support me.

So, with all due respect to the Gates and Schultz's of the world, it is entirely possible to be both risk-averse and successful. Much more important, in my opinion, is to be pragmatic.

Finding balance as an entrepreneur

The decision to take a risk should not be spur of the moment – that's why there is such a thing as “calculated riskIf you're trying to decide whether a new venture, whether it's a startup or product, is bold and innovative or just plain silly, I recommend conducting a SWOT analysis.

A SWOT analysis is a matrix that lays out strengths, weaknesses, opportunities and threats, and is a very important component in determining whether an idea or business model is viable. We regularly use SWOT analyzes at Jotform to assess which products are attracting the most customers and use that information to determine demand for future projects.

To get the most out of your SWOT, I advise focusing on the interplay between the four sections so you can more easily identify available solutions to threats and weaknesses. Be open to discovering new insights that you might not have noticed if you had analyzed each quadrant on its own. Say, for example, that a weakness of your company is that your product is undifferentiated from the competition. A threat, then, can be competitors who make it clear how their products meet customers' needs. It may be that a critical issue in one section builds on a problem, threat, or opportunity in another.

Related: You have to take risks to succeed. Here are 4 benefits of taking risks in entrepreneurship

It's also a good idea to set parameters for risk based on experience, says Frederic Kerrest, co-founder of Okta and author of Zero in IPO.

“You wouldn't ask someone to climb Mount Everest before climbing a hill in their backyard,” he writes.

Defining a project's scale, budget, and timeline will prevent it from spiraling out of control, as well as defining the circumstances under which the project must be completed.

I would argue that all of this takes courage. It's much easier to shoot in the dark – or jump off the wall – and hope for the best. It is much more difficult and intensive to assess the facts in a clear way and take informed action based on your findings. Sometimes, we don't get the answers we want: There may not be a market for the product you wanted to launch or the company you dreamed of building. True bravery is accepting reality, regrouping and deciding where to go next.