The last laugh, of course, went to Mark Zuckerberg. Now a billionaire, he was chosen by Time magazine as its person of the Year for 2010. There were few complaints or even raised eyebrows.
This is the era of the entrepreneur. What began in the entrepreneurial melting pot of Silicon Valley as a dream for a select few has become a worldwide phenomenon. Would-be entrepreneurs fill our TV screens and, for growing numbers of young people, creating a business has become a calling, a vocation, a mission. It is the spirit of the age; the new zeitgeist. A few entrepreneurs start out with grand visions in mind. But most simply don’t want to work in traditional corporate hierarchies.
They’re willing to borrow money from friends and relatives and even run their credit cards up to the hilt to get a business off the ground. Defining what an entrepreneur does is relatively straightforward. “A person who undertakes an enterprise or business, with the chance of profit or loss”, says the dictionary. But pinpointing what makes someone an entrepreneur is problematic. The characteristics of entrepreneurs have been debated for centuries. Like leadership, with which it is closely linked, it is hard to put your finger on what makes a successful entrepreneur. Tim Waterstone, founder of the eponymous book chain and a successful entrepreneur, observed some common traits. Great entrepreneurs, he noted, share the following characteristics. They:
- Are inspirational leaders
- Believe their vision is right and don’t falter in their belief
- Derive energy from being the underdog
- Are driven by a strong desire to beat the competition — to defeat the enemy
- Combine enormous energy with fortitude and tenacity
- Demonstrate courage — by taking risks
- Have a deep respect for the people in their team, and value team building
- Understand how money works. Not necessarily in a technical way, but in an intuitive way.
There are many other such lists. What it takes to succeed as an entrepreneur is one of the business holy grails. What can be said with certainty is that entrepreneurs are dynamic, restless creators. They don’t tick, they buzz. “I always run through the office”, says Amazon’s Jeff Bezos. “I mean physically I’m a little bit hyperkinetic. That’s why I like this environment.” High energy levels are vital for entrepreneurial success. There aren’t many lazy success stories out there.
Energy is a prerequisite for the job. Energy drives and changes businesses both old and new. There is a difference between possessing energy and being a seriously hard worker. Maximising entrepreneurial energy is more than running fast or working harder. Anyone can work 16 hours a day. For successful entrepreneurs, how they spend their time, how they enthuse others is more important than the hours they work. Quality is vital; quantity is no longer a competitive advantage. Quantity is never quality. The energy characteristic of entrepreneurs leads them to question what others assume. Entrepreneurs liberate energy in others. Their belief and desire to change things gives them energy and inspires others. They discover energy from the mundane, from the routine. They extract ideas to generate enthusiasm. They invent different approaches and try new things. They generate energy from themselves and stimulate energy out of those they work with. They attract people with energy.
The second undeniable characteristic of entrepreneurs is an ability to focus energy and thinking on the issues, trends and people that really matter. Energy is channelled to the essence of what is important. The ability to cut out the dross, the distracting stuff, has never been more important. Choice and complexity can overwhelm. The supply of information and opinions leaders receive is incredibly complex. Despite the flood of calls, the e-mail deluge, entrepreneurs make sense of it and extract the important details from the vast bulk of paper and input from a wide variety of sources. No matter what, they keep communication as simple as possible. They assiduously distil information and insights. Simplification is a necessary evil. If you are to sell an idea in a complex environment it has to convince people… and quick. To be petite is to be perfectly formed. “Say you have a meeting and someone goes home at night and the next day there’s a ten-page memo that’s crisp in evaluating the ideas — that’s a smart piece of work. In software, it’s not like ditch-digging where the best is two or three times faster than the average. The best software writer is the one who can make the program small, make it clever,” Bill Gates has observed. Entrepreneurs are adept at crystallising ideas. Small and clever. It is always easy to make things complicated; far harder to make things simple. Distilling messages inspires. It renders hazy generics uplifting.
Networked to the hilt
The third ingredient in the make-up of today’s entrepreneurs is that they are wired and networked to the hilt. Facebook is not only an entrepreneurial inspiration, but a useful business tool. No surprise. When it comes to new technology they get it in a way most big companies can only dream of. “The nerds have won,” management guru Tom Peters proclaimed when the market valuation of Microsoft exceeded that of General Motors. But while large organisations paddle hard to keep up with the technological current, entrepreneurs embrace it with something approaching abandon. Again the crucial difference is one of focus and perception. Entrepreneurs regard technology as crucial in a number of key areas. First, technology allows for cost effective organisation. Forget about all that mortar, all those bricks. Entrepreneurs are as comfortable working from their bedroom or a local coffee shop as a tower block. Second, it facilitates constant communication. To distil things down, you have to talk a lot in the first place. Third, it enables flexible working. Technology switches work on, whenever, wherever. Entrepreneurs don’t regard this as the tyranny of the BlackBerry but the freedom to make choices about when and where you work. And, four, it gives you a direct route to customers. Technology delivers you to the living room of the consumer every moment of every day. Add on the networking powers of social networking and it becomes clear that entrepreneurialism and technology are inextricably linked as never before.
To top off energy, entrepreneurs are natural enthusiasts. For them the job itself provides a reservoir of energy. The job matters. Business is a vocation — a calling. They want to work with other highly motivated people. They are passionate about work. They blur the divide between business and private lives. They bring their emotions to work along with their iPads. “Some people think enthusiasm at work is childish. We reject that notion. Emotion, enthusiasm, energy, passion, whatever you call it, is the lifeblood of entrepreneurial activity,” write Matt Kingdon, Dave Allan, Kris Murrin and Daz Rudkin, the founders of the innovation consultancy ?What If!. “Too many managers have erected barriers to protect themselves from these very emotions. We believe that in time, creative revolutionaries will swarm over this barricade. They will demand to know why emotions are excluded from a large proportion of people’s lives. They will throw off the chains traditional managers have shackled themselves and others with. Yes, we are passionate about this.” Paradoxically, energy and enthusiasm are not hard work. Really effective energy doesn’t look as if it is energy at all. It looks energy-less. Great energy slows time — look at great athletes. They appear to have all the time in the world.
The human side of enterprise
The next important element in entrepreneurial DNA is that they value the human dimension. While previous generations paid lip-service to the idea, today’s entrepreneurs know that people make the difference. Empathy is matched by emotion. “People have an enormous need for art and poetry that industry does not yet understand,” says Alberto Alessi, founder of the eponymous company. Emotion affects every business everywhere. Entrepreneurs believe that the ability of managers to understand and manage their own emotions and those of the people they work with is the key to better business performance. So, what it takes to be an entrepreneur is demanding and multifaceted. But, it is also for many people throughout the world an irresistible — and often incredibly fulfilling — temptation. To better understand the nature of this temptation, we asked 11 entrepreneurs about their experiences, as well as their hopes and fears. Their candid views, thoughts and concerns give a glimpse into the zeitgeist.
Continue reading in PDF format
“What it takes” can be read in full in vol 22/issue 1 of Business Strategy Review.
This article was taken from Business Strategy Review, for the latest business thinking from all London Business School faculty