Thoughts On

I liked the book Tribes by Seth Godin.  It’s short and sweet.  A lot of books these days are so long – as if the author had a target word count and was obligated to surround the few key insights with endless examples and explanations.  Seth has a way of getting right to the point.  Here are my favorite parts in the order they appeared in the book (I take no credit for these ideas, they are Seth’s insights):

Stability is an Illusion

The recent financial crisis, global warming and violence in Gaza/India/Georgia should have made this obvious, but it seems so many people still don’t get it.  In entrepreneurship, this is the justification for not starting so many companies.  There’s always an assumption that the past defines the future: “Google will always be the best search engine.”  “Apple will always have the best mp3 players.”  “Oil will always cost $25/gallon.”  “Oil will always cost $150/gallon.”  “Manufacturing in China is always cheaper.”  You shouldn’t take anything for granted.

We like factories, because we like the absence of responsibility

Yes, factories are efficient – that matters too.  But, the really boring factory jobs (“factory” defined broadly as any company that reliably produces a product or service with measurable output) are compelling to a lot of people.  They don’t require initiative or innovation.  They feel low risk.  They promise that if you do what you are told, you will get paid.  It’s comfortable and safe.  At least it feels that way until the factory gets shut down.  Then you have (as we have in Michigan now) hundreds of thousands of factory workers feeling the very fabric of their lives be ripped apart.

The “Bureau of Ideas” does not exist

There are lots of people with good ideas.  “Ordinary people can dream up remarkable stuff fairly easily.  What’s missing is the will to make the ideas happen.”  So many people I meet talk about their ideas but do nothing.  They think that if their idea is good enough, or if they tell the right person, they will automatically be rewarded with a prize for having such a good idea.  This just doesn’t happen.  There is no bureau to submit your idea.  There is no 10 point score for ideas where if you get a 10, you somehow profit.  You need to do something.  It is only in doing something that we find success.

Fear of criticism

Most of the time, we are more afraid of criticism or blame then we are of failure.  When you’re thinking about starting a company, you’re less worried about losing money or losing time and more concerned that you will look stupid.  I remember a talk by Jeff Bussgang at MIT where he was asked about starting a company without funding.  His advice to us entrepreneurs was to make sure our decisions were “objectively credible”.  I told that to my partner at the time and a week later he quit.  I’m not saying Jeff is wrong, but I think this fear of criticism and this desire to stay “objectively credible” will hold people back from doing remarkable things.

Think your way around fear

“You can talk over the fear, laying out a game plan that makes the fear obsolete… making it clear to yourself (and others) that the world is now demanding that we change. “  You need to talk yourself out of fear.  This is what an entrepreneurs business plan is all about.

Leadership is painful

If you’re not stressed out.  If every day is a good day.  If you’re always relaxed.  Then, you’re probably not leading.  Creation is painful.  There is stress and strife.  Important decisions need to be made without all the information.  “Leadership is uncomfortable.”

Religion and faith are two different things

I am not religious.  When I was younger I used to say that religious people are crazy because their beliefs are fundamentally irrational.  I’d explain that these people group together to reinforce their irrational beliefs.  However, I’ve come to believe that if you’re running a startup, it is also irrational to believe that you will be successful.  Most startups fail.  Your competitors have more resources than you.  I also noticed that I now love hanging out with other entrepreneurs – people just as crazy and irrational as I am.  We encourage each other.  “Don’t give up… you can do it.”  I then concluded that all people are actually crazy.  This craziness is faith.  I think faith is important to mental health and human life.  I am still not religious, but I definitely have faith.

React vs. Respond vs. Initiate

Reacting is what politicians do all the time.  It’s instinctive and dangerous.  Responding is better.  It means you think about what happened, you consider options and take action.  Big companies respond.  They have too much bureaucracy to simply react.  Board meetings and public relations committees usually provide reasonable responses.  But the best thing to do is initiate.  Initiators don’t wait for the disaster to occur or the opportunity to pass.  Initiators are real leaders. Startups initiate.  They see what others ignore and take action.  Startups are responded to. Microsoft has responded to Google.  Google has responded to Facebook.  Facebook has responded to Rock You.

Life is short

Too short to spend all year in a job you hate waiting for your two weeks of vacation.  If you’re not engaged, if you don’t have a sense of purpose, then do something else.  The fun jobs are the ones where you’re discovering new things, breaking new ground, innovating, changing the world.  If you’re putting together powerpoints that your boss never looks at you probably hate your job.

Wrong isn’t fatal

“The only thing that makes people and organizations great is their willingness to be not great along the way.  The desire to fail on the way to reaching a bigger goal is the untold secret of success”.  I believe in this whole heartedly.  It applies to so many things. There are so many stories of startups that realized their original idea was flawed, correct and then achieve success.  Being wrong is not the end of the world.  You don’t need to marry your first girlfriend.  You don’t need to stick to the same career your entire life.  It’s by trying things out that we learn what works and what doesn’t.  Being wrong is an opportunity to grow.  People that fail often, early on, but keep trying new things end up finding great success.  Richard Branson, Donald Trump, Tim Ferriss come to mind.

Understanding the trick is not the same as doing it

In business school, we studied leadership, finance, entrepreneurship.  It’s safe to say that most people with MBA’s understand how these things work.  Disruptive innovation is actually a pretty simple concept.  It’s a lot different to actually do it.  There are so many folks (associates at VC firms and consultants) that will tell you how to run your business.  They’ve studied it, they’ve seen it done before and they “understand” it.  They are enlightened.  “Manufacture in China to decrease costs.”  “Hire a great team.”  “Find a big partner.”  Sure, their advice can be useful.  But the key to success is not always knowing what to do.  The trick is doing it.  Execution is not trivial.

Forces for mediocrity

“There’s a myth that all you need to do is outline your vision and prove it’s right – then, quite suddenly, people will line up and support you.”  This was the fantasy of my business school years.  Come up with an idea.  Write the business plan.  Win a business plan competition.  Raise $5M in VC funding. Hire a top-notch team of industry experts.  Sit back and let them work out the details.  Customers come rushing to you for the obvious benefits your product provides.  You retire rich and successful. HA!

“Remarkable visions and genuine insight are always met with resistance.”  Especially in business school: you tell colleagues an idea and they will do their best to find the holes in it.  It’s what MBA’s are programmed to do.  “Is the market big enough?”  “Are you SURE your conversion rate will be 2%?”  “If this is such a good idea, why hasn’t anyone else done it?” “What about google?”  Yes, this is helpful – it challenges you to think things through.  But it also makes you wonder if starting your business would be “objectively credible”.  Many would be entrepreneurs either retreat to a job in banking or consulting “to get a few more years experience” or endlessly pitch VC’s with the hope of winning some validation for their idea.

Success before commitment

“If your organization requires success before commitment, it will never have either”.  Commitment needs to come first.  If you’re not willing to put $10K on your credit card to get things going, why would someone put $1M into your venture?  Good partnerships and successful VC investments don’t come until it’s clear that the startup is absolutely determined to find a way to be successful (with or without them).