Planning, Startups, Stories

Passion and Persistance Can Be Overrated

I'm worried. I spoke yesterday at SpeakerLunch in Corvallis, an interested and interesting group of people, looking at starting and running businesses. New businesses, small businesses, and so on. They call it speed mentoring. Bring in a speaker once a month, over lunch, talk about it.

My problem this morning is the overuse of the three Ps of passion, persistence, and perseverance.

The question of the economy came up, towards the end of the session. I don't remember the exact wording, but it was about the wisdom of sticking with it during tough times, or starting a business during an extreme recession, or something like that.

Which reminded me that in the world of entrepreneurship a lot of old guys (like me) give people pep talks about passion, persistence, and perseverance. As if the key to business success were just sticking to it, no matter what. Good times or bad, the entrepreneur, we seem to think, is driven to success. My business above all.

What worries me about this is that it's too damn easy for the people on the podium to preach about sticking to it, and sometimes passion and those other Ps are misplaced.

I love the idea of starting business and entrepreneurship and all, but not at all costs. I am not advocating passion to the point of obsession; and particularly not getting so far down into the business, bad times or not, that you think of nothing else, and lose relationships.

Life is more important than business. Keep your balance. Keep your priorities straight.

These are tough times. Plan well. Be smart. Think it through. Don't bet the farm unnecessarily, and certainly not just because some old guy says you have to have passion and be persistent.

Who is "Small Business Owners?"

Pardon me, but there is no "small business owners" group. We, the people who run the so-called "small" businesses, are a bunch of wildly diverse people with very little in common. We don't vote as a block, we don't do things as a block, and we don't think as a block. As a matter of fact, I'll bet we're more diverse than most of the artificial groups that pollsters glue together.

In recent news:

San Francisco May 27, 2008 Small business owner optimism continues on a five-quarter decline, according to the recent Wells Fargo/Gallup Small Business Index (Index) survey conducted in April. The Index score dropped to 48, the lowest level reported since the surveys inception in August 2003, when the score was 69. The most recent results represent a 35-point drop from the previous survey in January 2008, and a 66-point drop from the Index's highest score of 114 in December 2006.

This is interesting news, but hardly surprising. And, getting to the point of this post, I'd bet you could poll any group -- home owners, adults, butchers, bakers, left-handed gardeners, renters, automobile owners, college students, retired people -- and get roughly the same outcome.

I enjoy the use of language too. Did you notice in this press release that it isn't pessimism increasing, but rather optimism declining?

For about six months now I've been trying to post on a small business angle to the 2008 presidential race, but I just don't see how small business owners come together as a group on anything. Who is the small business candidate, now that the race is down to two main candidates: Barack Obama or John McCain? I don't think their politics or your business ownership dictates that. I think small business owners vote like anybody else, according to their very distinct and heterogeneous views of the world. 

For example, most of the pundits seem to assume that small business owners are against taxes and spending, against any law regulating the relationship with employees, and against any increase in minimum wages. Do you think that's true? I don't. I think the politics of any specific small business owner depends a lot more on her politics than on her business.

I'm a small business owner, and my optimism or pessimism, and my politics, aren't a function of my business; it's about who I am, and what I think, and how I vote. And I don't vote for my business; I vote for myself. From what I've seen in more than 30 years as a business owner, other owners do the same thing.

I think we are not a group. We don't have group opinions, or group politics. We are a lot of individuals. What do you think?

(note: I posted this a few hours ago on Small Business Trends. I'm reposting it here on this blog for my subscribers' convenience.) 

Entrepreneurship Epidemic

Watch out. Entrepreneurship might be contagious. I see it a lot these days. A lot of my family members are involved in it. Then I go over to the University of Oregon a few blocks from my office, where I teach Starting a Business one quarter every year; they are not business majors, but they do want their own businesses. It's an epidemic.

I've seen a lot of it in different research outlets, different blogs. This was in yesterday's Wall Street Journal, an opinion piece by Michael Malone, called The Next American Frontier:

The most compelling statistic of all? Half of all new college graduates now believe that self-employment is more secure than a full-time job. Today, 80% of the colleges and universities in the U.S. now offer courses on entrepreneurship; 60% of Gen Y business owners consider themselves to be serial entrepreneurs, according to Inc. magazine. Tellingly, 18 to 24-year-olds are starting companies at a faster rate than 35 to 44-year-olds. And 70% of today's high schoolers intend to start their own companies, according to a Gallup poll.

An upcoming wave of new workers in our society will never work for an established company if they can help it. To them, having a traditional job is one of the biggest career failures they can imagine.

Much of childhood today is spent, not in organized sports or organizations, but in ad hoc teams playing online games such as Half Life, or competing in robotics tournaments, or in constructing and decorating MySpace pages. Without knowing it, we have been training a whole generation of young entrepreneurs.

And who is going to dissuade them? Mom, who is a self-employed consultant working out of the spare bedroom? Or Dad, who is at Starbucks working on the spreadsheet of his new business plan?

In the past there have been trading states like Venice, commercial regions like the Hanseatic League, and even so-called nations of shopkeepers. But there has never been a nation in which the dominant paradigm is entrepreneurship. Not just self-employment or sole proprietorship, but serial company-building, entire careers built on perpetual change, independence and the endless pursuit of the next opportunity.

Without noticing it, we have once again discovered, and then raced off to settle, a new frontier. Not land, not innovation, but ourselves and a growing control over our own lives and careers.

So that's a very powerful set of numbers and facts.

Meanwhile, on the very same day, I get an email for a webinar on how to manage Generation Y employees. Is this related? Different sides of the same coin? Big companies find them hard to manage, but they're out starting their own little companies instead.

Maybe that's just coincidence.

Distant Neighbors, Common Cause

I'm in Veracruz Mexico this week at what I hope will be an inflection point for cooperation between the U.S. small business development centers (SBDCs) and the equivalent Mexico organization, AMCDPE. They are calling it "Making Small Business Grow (Hacer Grande la Pequeña Empresa)".

Politics of LAFTA and all notwithstanding, especially in an election year, what's going on here, with very little notice, is three days worth of meetings between people in both organizations. The agenda is spiced with American veterans of US SBDCs sharing their experience with their Mexican counterparts, one presentation at a time. Most of the panels include one person from a US SBDC alone with one or two from Mexico.

For example, tomorrow's agenda includes the director of the Mississippi University SBDC and experts from Veracruz and Tabasco looking at how small business recovers from natural disasters. The theme: "three years after Katrina." This event, by the way, is in Mexico's Gulf of Mexico port that was seriously submerged in the 1988 by Hurricane Gilbert.

They're also presenting panels including US and Mexico experts on technology transfer from universities, working with banks, and sharing some success stories.

I'm on the agenda on Wednesday, talking about business planning.

This strikes me as a good place for cooperation between these organizations. Let's grow small businesses. I don't know the Mexican organization very well, but I do know that the US SBDCs are among the best advice givers there are for small business, and the more successful small businesses in Mexico, the better off the world. So I'm rooting for this idea to work.

5 Business Life-work Stress Factors

It takes a village to make sense. I posted Business, Pleasure, Death Sentence Wednesday on Small Business Trends, about the alleged stress of blogging. I quoted John Jantsch and Alan Johnston making fun of a poorly aimed (my opinion) New York Times story about bloggers dying from presumed stress. As of yesterday morning that post had collected several fun and interesting comments.

What is it that really causes stress while working? Granted, the NY Times story could have been written about any pursuit that anybody ever overstressed over. That's not very useful. But are some jobs more stressful than others? Or is it perhaps the match between the job and the person, the skills and the requirements, that causes stress? Or is it perhaps just the person, because some people will overstress about anything? This has been making me think. 

Last August I posted Passion or Ability? on this blog, about a question I got in email. The key quote was this one: 

So my question is even though I'm good at sales and advertising, should I stick with it or find something that I'm passionate about? What's more important--passion or ability?"

That post generated some interesting comments too. I think we're getting somewhere.

Hypothesis: could it be that work stress is related to mismatches? Not just the obvious working too hard, or mismanaging stress by mixing urgency with importance or failing to breathe deeply and settle it down on occasion? More specifically, these two key factors:

1. Mismatch work and values. Could it be that if you don't believe in what you're doing, that makes things harder, and causes more stress? I'd like to think most businesses believe in what they're doing. People who work in the restaurant have to like the food they serve. People who sell software have to believe it works, and that it's good for its users. People who fly planes have to believe in the planes.
2. Mismatch work and abilities. Some people love the phone, some hate it. Some can work all day alone with a computer, some go stir crazy. Some want to sit at desks, some want to climb ladders and pound nails. We had an employee at Palo Alto Software who was fluent in six languages and had a PhD degree, but wanted only to disassemble returned product. We tried to get him on the phone with customers and he hated it. 
3. Mismatch work and preferences. Some people love to travel. Some hate it. I've been in heavy travel jobs off and on for most of my life, and I've seen colleagues who hated leaving home and colleagues who couldn't wait to get back on the road. Family makes a big difference with that. Notice I distinguish between this one and the abilities one. What you like to do isn't necessarily what you're best at; I think both factors are important. Some people like to dress up, some don't. One person at Palo Alto Software asked for "dress-up Fridays" because we're so casual. Some people like the office, some like working alone at home. 
4. Working in a vacuum. No feedback. No metrics. Am I doing a good job? How would I know? 
5. Work competing with life. This is really just a restatement of point number 3, but I can't help it. I've seen companies that discouraged the rest of your life, wanted people in the office as much as possible, and I've seen companies that wanted people to have the rest of their lives. How driven are you? Are you disappointed when teammates leave at 5 pm?

I don't mean to suggest that this is an inclusive list. I bet we all know people who turn anything into stress, and people who glide through anything. So personality typing, and attitudes obviously make a big difference. And -- who are we kidding -- some jobs are more stressful, and some bosses are more stressful, and some companies are more stressful, and some cities (commuting and all that) are more stressful. 

One of the comments to the Small Business Trends was this one:

That whole “do what you love and the money comes later” thing sounds trite, but it is true.

I like that. Sometimes the truth of these things is trite, but still bears repeating.

And then there's the comment from Anita Campbell, founder and creator of Small Business Trends, which has more than 100,000 subscribers, about her life in blogging compared to the so-called real world:

My positions in the corporate world were 20 times more stressful than anything I do now. Not to mention all the time I used to waste in commuting (2 hours a day) plus writing reports (1 hour a day) plus meetings that were just people jockeying for position vis-a-vis one another (1 hour). That was the equivalent to half a work day right there — before I even got anything accomplished! THAT was stress, not what I do now.

So this is just my guess. Stress isn't by type of job alone. This is one of those difficult things that's hard to isolate. It's probably different for everybody.

Maybe we need a refresher on why zebras don't get ulcers.

Does Investment Make the Venture?

I posted on Up and Running yesterday about a Forbes.com piece called Is Your Great Idea a Real Business?. It's a useful piece, well written, with a good list of six questions. The questions ask about value proposition, market, costs, commitment, and other factors like those. However, it's built around an underlying assumption that bothers me. I didn't get into that on that other blog, but it left me wanting to address that other issue here, on this blog.

So what bothers me is the assumption that you aren't somehow "real" unless you "get funding;" meaning, in context, outside investment. A business isn't necessarily a business opportunity.

And I don't want to single out that one piece, its author, or its sources. It's just that I don't want people to dismiss, automatically, the bootstrapped startup. To take one rather well-publicized example, is truemors.com not real because (as founder Guy Kawasaki has been so quick to acknowledge) there was no outside investment; nobody got funding? And it's hardly the only example. Web 2.0 is full of them. What about those successful blogs that grew organically, in the beginning, without funding? What about all the professional service businesses; they aren't real either? And that reminds me, I was there (on the board) as Borland International went from zero to IPO in less than four years without outside funding. That was pretty real.

I understand that to teach business, and entrepreneurship, we have to focus on the high end, which of course is the rarefied air of venture capital and angel investors. You don't teach literature by focusing on trash novels, or art by looking at dogs playing poker, so if you're going to teach about ventures and startups you should teach the business plan and the funding process. That means market analysis, value propositions, investment offerings, pitches, exit strategies, and return on investment.

However, when we're talking about business in general, let's give bootstrapping its due. There is a lot to be said for managing to get it going on its own power, scraping a lot at the beginning of course, but eventually building a business that doesn't depend on the big investment. At the far end of that rainbow, there's owning the business by yourself, without having to deal with (so-called) outsiders.

And those two reminders prompted me to look again for a study I saw last year. I found it as a Wells Fargo News Release from 2006. A Wells Fargo/Gallup study found that small business owners use an average of only $10,000 to start their business. Don't you think it's real, or at least a lot of those are real, whether or not they "got funded?" I do.

Save Me From the 4-Hour Work Week Nightmare

Paul Brown listed some good time management tips for entrepreneurs yesterday in the New York Times. His list includes a discussion of Timothy Ferriss' hugely successful book, the 4-Hour Work Week.

The 4-Hour Workweek by Timothy Ferriss Read more about this book...

It's a good list, worth reading. But it leads me in a related direction.

I'm just a single data point, but I'm pretty sure I'd hate a 4-hour work week. I had the privilege of hearing Timothy Ferriss at a conference last year. He's impressive. He's a very good presenter. When he explained it himself, with good slides and sharp humor, his basic idea seemed to make a lot of sense. Farm out the small stuff. Hire somebody else to answer your emails. Work on the big stuff.

I'd hate the 4-hour work week because I love my work. And I think that thought is related to the core of at least one branch of entrepreneurship: the escape from boredom.

My older brother has accused me of a "one-size-life-fits-all" philosophy, but I feel that it's useful to share that the "escape from boredom" school of entrepreneurship has worked for me. Palo Alto Software was built on the foundation of doing something (business planning) that I like to do. Sure, there were lots of bad days (when cash flow was scary, every day was a bad day) but over the long term it was about doing what I wanted to do.  And, as it grew, surrounding myself with people who liked doing what they were doing.   

Not all entrepreneurs subscribe to this philosophy. It's really hard to classify entrepreneurs. Some pursue nothing but money, more often it's following a dream, proving something, doing your own thing; sometimes it's simply about working alone.

So not to assume that one size fits all, maybe I'm just lucky. My work is about writing, and starting companies, and business planning, and entrepreneurship. Sometimes it's teaching a university class, which I'm doing this Spring quarter twice a week. Sometimes it's doing a seminar, or webinar, and lots of times it's keeping up with things on this blog. Today it's the first day of the Starting a Business class I teach every Spring quarter at the University of Oregon. Tonight I'll be helping with the Eugene Oregon Smart-ups conference, reviewing four new businesses over dinner. Tomorrow I'm off to Houston to be one of the judges at the Rice University Business Plan Competition. Next week I'll be a judge at the University of Oregon intercollegiate New Venture Championship.

And I wouldn't miss it for the world.   

And this idea isn't being fair to the good time management tips this post started with, or the good sense in Timothy Ferriss' book. Still, I face a fresh new class today, and one of the most important things in starting a business is matching up what you have to do with what you like to do. 

Entrepreneurship Week at Stanford

One of the highlights of Entrepreneurship Week at Stanford is the documentary on the previous year's Entrepreneurship Week.  If by any chance you can't see the YouTube direct, click here for the link.

Startup Culture Shock: Is Startup Life Life?

So I think somebody struck a nerve. So what do you think of this tip to save money:

Fire people who are not workaholics. Come on folks, this is startup life, it's not a game. Don't work at a startup if you're not into it. Go work at the post office or Starbucks if you want balance in your life.

That's from Mahalo founder Jason Calcanis, late last week, on his blog. He titled his post How to save money running a startup (17 really good tips). So he's the one calling his tips "really good," not me. Some of them are pretty good tips, but I think they got lost in the storm.

Responses came fast and furious. 111 comments by Sunday morning. Other blogs reacted too: one of the best of them was from 37 Signals, titled Fire the Workaholics, which concluded:

If your start-up can only succeed by being a sweatshop, your idea is simply not good enough. Go back to the drawing board and come up with something better that can be implemented by whole people, not cogs.

That one has 90 comments on it. Two posts about it -- one by Michael Arrington agreeing and another disagreeing --  have about 350 comments between them.

Jason, meanwhile, got hit hard, with some strong words. He quickly toned down the original, striking out a couple of the more quotable phrases. And, to his credit, he shows the edits too, in the post you'll find when you go there.

Fire people who are not workaholics. don't love their work... come on folks, this is startup life, it's not a game. don't work at a startup if you're not into it--go work at the post office or Starbucks if you're not into it you want balance in your life. For realz

What's going on here? I think it's culture shock; war between worlds. These are not simple disagreements. There is a whole lot of aggression and anger in the comments.

There was a joke I heard first in Mexico City. Maybe you've heard an English version, but this is a translation. It's related to all of this.

A man walks into a crowded cantina and starts shooting two six guns in the air, getting everybody's attention. He draws a line across the middle of the bar and issues an order: "I want all the fools on one side of the line and the jerks on the other."

"Wait just a minute," says one man in the crowd. "I'm no fool."

"Then move to the other side of the line."

That's what this controversy is trying to do to startups and people running startups. It's pretty much either or, if you believe the flow and direction of the comment storm: fool or a jerk.

And I don't think it's that simple. I see at least two other issues rolling around vaguely in the middle of this. And perhaps a way to bring them together.

First, how do you define success? Every so often somebody reminds us that it's an important question. But we get lost in the startup tension, or maybe that's the startup culture. I think all we have to do is ask the question, as a reminder. There are so many shades of gray between the back of plain old failure and the white of fabulous billionaire success. Some people want to have a life, and they want the people around them to have lives. And it's not like there aren't examples of startups that respected people and balance. On the other hand, there are lots of stories around. One person's obsession is another's passion. You can paint that picture how you want. Do you want to be coach the kids' soccer team or (have a very small chance to) be on the cover of magazines?

The second issue is founders with blinders. They want the whole team to share the obsession but they forget that only a few of the top founders actually stand to share the pot of gold at the end of that very-hard-to-catch rainbow. Sometimes its leadership, sometimes its selfishness. It's insisting that everybody buy into their private dream, which sometimes is shared, and sometimes not. I've seen that kind of driven-and-driving-founder at work. The younger Steve Jobs was like that at Apple during the Macintosh gestation in 1983. Philippe Kahn had a lot of that when he build Borland International in the middle 1980s. I saw it again from a comfortable distance in the late 1990s, with dot-coms and their hard-driving work-is-everything atmosphere. That reminds me of the late 1990s in Silicon Valley. Back then it happened all over. I knew a company that raised $45 million venture capital in its first year, hired more than 100 employees, nobody over 30, and brought in dinner almost every night and offered video games and ping pong in the office. The 12-hour days were the norm. The long hours, the lack of balance, the obsession is supposed to be shared by the whole team, but, in many of these cases, the supposed rewards at the end of that long trek won't be shared by the whole team.

It can be a bit like the one-size-life-fits-all syndrome, except in this case it's the one-size-no-life fits all. Does that work? It didn't for that company I knew, which (because a legal settlement so required it) shall remain nameless. It did for Apple and Borland. I don't think that works very well for very long for anybody, at least not for any extended period of time. But then again, some of the people who say that it works have a whole lot of money.

And how do we bring it together? I think it might be value. Believing in what you're doing. I've known companies, and teams within companies, that believed that what they were doing in the business mattered, to them and to the world. There's a very special feeling that you get when you walk out the door at the end of the day with the feeling that you've spent your time making the world better, not worse. Some companies are built on making things better, while others are built on getting money out of people's pockets. Some companies respect their customers, some companies bilk there companies. You know who you are. Does that make it better?

(note: I posted this originally on Small Business Trends. I'm crossposting here for readers' convenience)

Silicon Valley's Counterculture Roots

While I doubt that the zen of business planning is going to work anytime soon -- there's some undeniable paradox in trying to work being in the moment with planning -- there is something very powerful about zen that ends up adding to the allure of Presentation Zen, zen habits, and of course the original Zen and the Art of Motorcycle Maintenance, among others. More recently, there's Valley Zen, "at the intersection of zen and technology." 

	Presentation Zen by Garr Reynolds Read more about this book...
	Zen and the Art of Motorcycle Maintenance: An Inquiry Into Values by Robert M. Pirsig Read more about this book...
	From Counterculture to Cyberculture: Stewart Brand, the Whole Earth Network, and the Rise of Digital Utopianism by Fred Turner Read more about this book..

I've had some email lately with Drue Kataoka of Valley Zen, for several reasons. First, I like that blog. Second, it introduced Alltop, which is good news for all. And third, I've had an ex-hippy connection to zen since I was in Haight-Ashbury in the late 1960s, which, as you might imagine, was a good decade before I became serious about business and entrepreneurship. And if there is any way to connect zen to business planning, I'd like to be the one to do it.

Drue's quick answer to the ex-hippy zen MBA connection was a quick "look at today's blog post," which I did, and with that I discovered From Counterculture to ValleyZen, which is very much aiming at that same target. Synchronicity again, I suppose.

The post is built around a new book by Stanford professor Fred Turner, and an interview he did with Valley Zen. If you don't see the YouTube video here, you can click the link above to see it on the Valley Zen site.