My Take on Entrepreneurship

In the 2007 kids’ movie Ratatouille the mordant food critic Anton Ego says, “The world is often unkind to new talent, new creations. The new needs friends.” Every entrepreneur should be in furious agreement, because few things in life are tougher than trying to create a new company. Mostly, entrepreneurs are madly optimistic people – and we have to be, because pretty much everything will turn out to be against us in one way or another as we head down the road towards our distant but cherished goal. How does an otherwise normal person end up being an entrepreneur and, once the madness strikes, how do we sustain our effort in the face of reality slapping us across the face on a too-regular basis?

It all starts with a vision. Maybe you wake up with it one morning, maybe you come to it over beer in discussion with friends. However it arrives, every entrepreneur starts here, with The Grand Vision. This is where we spot a new market opportunity that we believe we can satisfy in a way that’s better than whatever exists today. Smart entrepreneurs then pour a metaphorical bucket of cold water over themselves – we try to poke holes in our nascent concept, because it’s way cheaper to fail up-front than six months and a lot of money into it. If we’re lucky (or, maybe unlucky, depending on how you see it) our vision survives its first mild brush with reality and so we convince ourselves that the dream is worth pursuing. Now everything starts to get real and the stakes start to increase.

No man is an island, entire of itself. Visions need people to make them real. So we reach out to the people we know and we start to pull the core team together. We convince others to join us in pursuit of the grand vision. Amazingly, some of them really will sign up because they too see the possibilities inherent in the vision. So we build the core team, assign roles and responsibilities, and we head off towards the distant horizon. This is maybe the most fun time in a start-up because at this stage everything is possible, pure, and full of hope. We know where we want to get to and we think we know how to get there. We may even raise some initial financing from angels, friends and family, or professional venture investors. At this point we’re off to the races.

Serial entrepreneurs can offer wisdom that comes from accumulated experience. Two particular pieces of wisdom are very important to a newbie entrepreneur’s personal survival: remember that every start up is a marathon conducted at the pace of a sprint, and remember to enjoy the peaks because otherwise the troughs will seem unbearably discouraging. So if you close a financing, it’s definitely important to celebrate, even if the celebration is just a beer and pizza at the local sports bar. Mark every triumph, no matter how small – these things count. One entrepreneur used to make a habit of telling total strangers every time his start-up closed a deal. Once he even shared the good news with an attendant at the Golden Gate Bridge toll plaza. Keeping your spirits up is essential.

There are some people whose lives seem unnaturally blessed with good fortune. These are the kids who leave school and seemingly five minutes later are billionaires because their start-up appealed to some hidden psychological desire within the minds of half-a-billion teenagers. Most of us, however, have to push through one challenge after another on our way to eventual success. And at times those challenges can seem pretty insurmountable. There’s not enough money, so we can’t hire the talent we need to get the product out quickly. But if we don’t get it out quickly our prospective customers will drift off. And of course each customer wants something slightly different so we struggle to figure out how to provide a product that will meet all their collective needs without becoming impossibly customized or overly complex. Some customers who at first seemed really enthusiastic will suddenly go silent and drop off the world, so we have to replace them with new customers. But… we don’t have much money, so this takes away time and effort that we were planning to spend elsewhere. Turns out when you’re doing a start-up there are never enough hours in the day to get everything done. So we either become masters of prioritization or we start to thrash. Not a few companies die at this stage because their teams burn out. Remember, although everything is done at a sprint pace, this is really a marathon. Even the overnight successes took years to blossom.

As we battle through the tough times it’s important to get support from team members, families, and friends. If your domestic partner isn’t behind you one hundred percent, chances are your relationship will suffer in a major way. Having someone who really believes in you can be a real life-saver. During the dark times it’s essential to keep the team motivated and focused. Sometimes it’s helpful to tell inspirational stories. In the early days of FedEx, the company was within a couple of days of running out of cash. CEO Fred Smith took the last $5,000 they had and headed to Las Vegas. Amazingly, he won enough to pay their jet fuel bill for the following week and so the company scraped past bankruptcy and headed for world domination. Similarly, more than once Oracle Corporation was able to run payroll only thanks to the heroic last-second actions of its top sales people. And more than one start-up CEO has mortgaged the house as a last-ditch effort. Of course, not all stories turn out happily – plenty of entrepreneurs have lost everything and had to start again. But as they say, “you miss every shot you don’t take.”

So the ideal entrepreneur is someone who is impossibly optimistic yet at the same time realistic enough to know when to make course adjustments. Someone who can ride the peaks and the troughs without succumbing to the temptations of ego or despair – yet who is empathetic enough to motivate the team and keep everyone on an even keel when things seem to be heading for the garbage can. Entrepreneurs are story-tellers, who impart the vision into the minds of others so that it can grow to the point where reality catches up. Entrepreneurs, basically, are cranks. But as Ernst Schumacher – the author of Small Is Beautiful – observed, “cranks are small devices that cause revolutions.” Our age has been built by such revolutions – revolutions in microprocessors, software, communications technologies, and social networks. Few things in life are more satisfying and rewarding than being a successful crank.

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