YOUTH GARAGE

- Bill Taylor

At the risk of sounding like a Grumpy Old Man, and with near certainty that this post will be roasted by many who read it, I am about to make the case that there is such a thing as too much entrepreneurship — or at least too much excitement about becoming an entrepreneur too early in life.

I know, I know. This blog, and all of my work over the last 15 years, has celebrated the spirit of innovation, disruption, and changing the game. But last week, when the New York Timespublished one of those bound-for-the-time-capsule reports on the culture of Silicon Valley, I for one had had enough. Anything in excess is a poison, after all, and in America we’ve made the phenomenon of taking every good idea to excess our new national pastime. That’s what we may be doing with entrepreneurship today. The startup bug has become a startup fever, and that fever may be driving many people to hysteria.

The Times piece was all about the new “War for Talent” in Silicon Valley, a replay of the battle waged more than a decade ago to recruit top-flight young engineers and coders from elite colleges and assorted countercultural pursuits. “The atmosphere is brutally competitive,” one executive said. “Recruiting in Silicon Valley is more competitive and intense and furious than college football recruiting of high school athletes.”

Talk about partying like it’s 1999: Zynga, the red-hot game maker, “dangles free haircuts and iPods to recruits, who are also told that they can bring their dogs to work.” (No word if the dogs get free haircuts too.) At Integra, a photo-sharing site, “workers take personal food and drink orders from employees, fill them at Costco, and keep the supplies on hand for lunches and snacks.”

All of this is pretty familiar, if slightly ridiculous, stuff. (I guess I am a Grumpy Old Man.) But what is truly new, and to me, at least, rather worrisome, is that companies have agreed to teach new employees how to start their own companies virtually from the minute they walk in the door. The hot new perk, for people who have barely spent a day working inside the company they have been recruited to join, is training and advice and lessons on how to leave that company and start one of their own. As the piece concludes, “Many of the most talented engineers want to be the next Mark Zuckerberg, not work for him.”

I suppose I’d like to be the next Mark Zuckerberg too, if only to get Jesse Eisenberg to play me on the big screen. But to me, this cult of the young entrepreneur runs the risk of becoming just another business-culture fad, the Silicon Valley version of every East Coast smarty-pants who aspired to be the next Gordon Gekko (a Hollywood-created crook, who, bizarrely, inspired countless young people to flock to Wall Street).

Here’s my major beef with what’s happening. The real metric of business success is whether you have a positive impact — on your industry, on your community, on (in a small way) the world at large. That doesn’t always mean starting your own company. Most of the time, in fact, it means becoming part of a company that you love, with a purpose you believe in, and people who you can’t imagine not working with. It’s all about the cause, the mission, the values you embrace, and the value you create. I’ve always admired talented people who want to be part of something bigger than themselves, rather than those who think it’s all about them, even when they’re in their mid-twenties.

Don’t get me wrong. I’m not against teaching people at a company how to be entrepreneurs. And, unlike say at Bloomberg, where people who leave the company are banished forever, I’m all for encouraging people to try new things with the hope that they will return. But I think it’s incredibly wrongheaded to compete for talented people based on pitching a company as a training ground for someone’s individual dreams, as opposed to a place where individuals can’t imagine not being — because the product is so important, the values so robust, the culture so engaging. Business ultimately is a team sport. As someone building a company, I’d much prefer people who genuinely want to be part of the team for the long haul, rather than “free agents” who are willing to suffer through a brief stint on the roster before they field a team of their own.

Malcolm Gladwell looked at this very issue a decade ago, during the last War for Talent, in a longNew Yorker piece called ”The Talent Myth.” The object of his attention (and scorn) was a company that vowed to attract the brainiest and most high-powered people in its field, and who promised that spending a few years there would give them the skills and mindset they needed to do whatever they wanted with the rest of their lives. That company was Enron, and we know how that turned out.

There’s a difference between attracting brilliant stars, Gladwell argued and building a brilliant systems for the long term. The most successful organizations, he said, “are the ones where the system is the star.” Indeed, he asked, “What if Enron failed not in spite of its talent mind-set but because of it?” he asked. “What if smart people are overrated?”

That was a heckuva question 10 years ago, and it’s a heckuva question today. Does it really make sense to move heaven and earth to recruit young people to your company whose real commitment is starting their own company? How about focusing on people (even if they are a little less young or a little less talented) who believe in your company and are committed to its success?

Let the debate begin….

- by Jeffrey Stibel

What does it mean to be an entrepreneur? I have heard far too many answers to this question. Everything from being a risk taker, inventor, a small business owner, to being just plain crazy or lucky. But none of these things have anything to do with entrepreneurialism, and frankly neither does much of what I have read in business books. Even the always insightful Malcolm Gladwell, in a recent New Yorker article on the subject, only got it half right.

Being an entrepreneur is something far different than what most people think. It is not about behavior (whether risk-prone or risk-averse); it is not about business type (you can run a small business, a public company, a division of a company, or be an investor); and it is not about title (you do not have to be a CEO to be an entrepreneur). Instead, I see it as a personality trait. There are plenty of small business owners and start-up founders who do exceptionally well — but are not what I would consider entrepreneurs. Just like in big business, you can be a successful general manager without being an entrepreneur or entrepreneurial.

I liken entrepreneurism to a disease. Having it myself, I am not always sure it is a good thing. That so many people wish to suffer from it just tells me they don’t understand it. Entrepreneurs, as the story goes, embody the American dream. They come from nowhere to build large empires, reap huge rewards, and live a lavish lifestyle. There is Larry Ellison and his yachts; Bill Gates and his 66,000-square foot smart house; Ted Turner and his nearly 2 million acres of land; Larry Page and his 747.

But those are the outliers. Gladwell’s well-received book of the same name estimated it takes nearly 10,000 hours of work to gain true expertise. Entrepreneurs are all in, all the time. Entrepreneurs love what they do and obsess over it. It is a predisposition; a path that has already been laid for you. It is a character trait, a labor of love, a zeal that cannot be trained, a condition that cannot be treated, an illness that cannot be caught. You’ve either got it or you don’t. Here are some questions to see if you have it:

• Do you wake up before your alarm goes off, hop out of bed excited to go to work? (good)
• Do you race to the car, forgetting breakfast, your morning coffee, and the paper? (better)
• Halfway to work, do you look down, realize you forgot to shower, shave, or get dressed? (great)
• Do you pause for a second, and then decide–what the hell–and head to work anyways? (diagnosis: entrepreneurialism; cure unknown)

I have done this far too many times, without any hesitation or embarrassment (my team jokingly calls these antics “Stibel-isms” but it’s really just entrepreneurism). Think of it as a very deep focus that is quite difficult to shake out of, especially when juxtaposed against life’s daily activities. Most people use a calendar to remind them of meetings and events; I have on my calendar such mundane things as eating lunch! Many people mistake entrepreneurism for ADD, or obsessiveness, or risk-taking, or hyper-mania or a host of other quirks. But entrepreneurs are really just manic-manic — there is one switch and it is always turned to on.

What drives an entrepreneur is not money. That is what drives businesses and businesspeople. But for an entrepreneur, money is merely a yardstick. Frankly, entrepreneurism is a very difficult and unpredictable way to make a living. It is often binary: either you make more money than your children, grandchildren, and even great-grandchildren will know what to do with; or you go broke. Most entrepreneurs fail miserably. If you want to guarantee a good living — one that will offer you a successful, stable career and a nice inheritance for your kids — listen to your mother and become a doctor, lawyer, or businessperson.

What makes some entrepreneurs successful is the same thing that makes others successful: relying on strengths and avoiding weaknesses. To be sure, entrepreneurs have an upper hand (or at least I like to think so): the energy level is higher, the confidence level is higher, and with time, entrepreneurs have a higher tendency to acquire subject-matter expertise. But success comes not from those things alone, but by leveraging core competencies. What makes me successful (sometimes) is that I combine my entrepreneurism with my strengths in taking calculated risks, decision making, and building teams of people I admire.

If you are an entrepreneur, use it to your advantage. But if not, don’t try to become one. (It won’t work — and why try to contract a disease? You wouldn’t try to get the measles). Instead, figure out what you do best and aim to do it better than anyone else. And if your organization needs an entrepreneur for it to succeed, just hire one.

Jeffrey M. Stibel is Chairman and CEO of Dun & Bradstreet Credibility Corp. He is an entrepreneur, a brain scientist, and the author of Wired for Thought: How the Brain Is Shaping the Future of the Internet.

Suddenly entrepreneurship is in vogue. If only our nation’s businesses—large and small—could become more entrepreneurial, the thinking goes, we would improve our productivity and compete more effectively in the world marketplace.

But what does entrepreneurial mean? Managers describe entrepreneurship with such terms as innovative, flexible, dynamic, risk taking, creative, and growth oriented. The popular press, on the other hand, often defines the term as starting and operating new ventures. That view is reinforced by the enticing success of such upstarts as Apple Computer, Domino’s Pizza, and Lotus Development.

Neither approach to a definition of entrepreneurship is precise or prescriptive enough for managers who wish to be more entrepreneurial. Everybody wants to be innovative, flexible, and creative. But for every Apple, Domino’s, and Lotus, there are thousands of new restaurants, clothing stores, and consulting firms that presumably have tried to be innovative, to grow, and to show other characteristics that are entrepreneurial in the dynamic sense—but have failed.

As for the idea of equating the beginning stages of a business with entrepreneurship, note a 1983 study by McKinsey & Company on behalf of the American Business Conference. It concluded that many mature, medium-sized companies, having annual sales of $25 million to $1 billion, consistently develop new products and markets and also grow at rates far exceeding national averages.¹ Moreover, we’re all aware of many of the largest corporations—IBM, 3M, and Hewlett-Packard are just a few of the best known—that make a practice of innovating, taking risks, and showing creativity. And they continue to expand.

So the question for the would-be entrepreneur is: How can I make innovation, flexibility, and creativity operational? To help this person discover some answers, we must first look at entrepreneurial behavior.

At the outset we should discard the notion that entrepreneurship is an all-or-none trait that some people or organizations possess and others don’t. Rather, we suggest viewing entrepreneurship in the context of a range of behavior. To simplify our analysis, it is useful to view managerial behavior in terms of extremes.

At one extreme is what we might call the promoter type of manager, who feels confident of his or her ability to seize opportunity. This manager expects surprises and expects not only to adjust to change but also to capitalize on it and make things happen. At the other extreme is the trusteetype, who feels threatened by change and the unknown and whose inclination is to rely on the status quo. To the trustee type, predictability fosters effective management of existing resources while unpredictability endangers them.

Most people, of course, fall somewhere between the extremes. But it’s safe to say that as managers move closer to the promoter end of the scale they become more entrepreneurial, and as they move toward the trustee end of the scale they become less so (or, perhaps, more administrative)