Because if I'm scared to say it, it's probably worth saying

January 14 2010

The Businessization of Entrepreneurship

Entrepreneurship is too big for the box we’ve trapped it in. [Image of suit trapped in a box - Click 'show images' to view]

What is an entrepreneur today? Someone who starts businesses. If you are really progressive, it’s someone who starts socially conscious businesses.

I hope this is simply a historical accident. Because there is nothing about innovating, finding unmet needs, building teams, bootstrapping, taking risks, competing, creating value and scaling a model that’s specific to business.

Imagine a world in which business had a monopoly on these practices. We would not have many of our most successful communities, social causes, political movements, service organizations, universities and religions.

Entrepreneurship has nothing to do with business or commerce. It’s a methodology for solving problems – perhaps one of the most versatile ever made. It is a way for a few small people to bring about massive, scalable change with little or no resources.

The problem is that business has seized the entrepreneurial brand and most of the entrepreneurial-minded talent. If you like solving problems in this way, you are told that you are most likely to find your soul mates — not to mention wealth and status — in business.

Business has turned all of this talent into incredible things: the technologies and products we depend on everyday, rising standards of living around the world and the financing for critical government services, non-profits and charities.

But business’s dominance of entrepreneurial ambition has also cost us. It has deprived us of talent in many of the things that make life worth living: the communities that make us feel connected, the causes that give us meaning, the education that gives us opportunity and the spirituality that gives us perspective.

Entrepreneurs believe that these pursuits are not for them. They think they won’t like them and won’t succeed at them. And so problem solving that should be entrepreneurial — by community organizers, activists, non-profits, universities and religious leaders — is often cautious, unimaginative and unsuccessful.

How do we show entrepreneurs the opportunities they are missing? And how do we change what entrepreneurship has come to mean?

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  • The creation of value (financial, social, career etc.) starts with finding a problem worth solving. Bigger problems yield bigger value. Entrepreneurs whose thinking is guided by existing categories and investor appetites are likely to take on challenges in areas in which the value of success doesn't justify the risk of failure.
  • Hey Garrett - Thanks so much for your comment. When you talk about the "value of success," who's idea of value do you have in mind? The entrepreneur's, the investor's, the end user's? I chose to say end user instead of customer to avoid being business-centric.
  • My thoughts were on the entrepreneur and the investor, both of whom share in the risk of failure. For entrepreneurs, the stakes relate to how they want to spend their time and talent. As for investors, I believe that one of the reasons for dissapointing returns in venture sector is that many of the execution risks of start-up of failure remain whether you are backing companies that are aiming low or high. If investors try to mitigate their risks by backing entrepreneurs whose innovations are merely incremental, all they do is reduce their potential return (the value of success, for the investor) without a commensurate reduction in risk.
  • Great point about how adding ambition doesn't often add risk -- and reducing ambition often doesn't reduce risk!
  • One of the better ways I've heard an entrepreneur defined was by Josh Kopelman. I'm paraphrasing, but the gist of his idea was that entrepreneurs find ways to decouple the creation of value from their contribution of time.

    In this sense, he drew a clear line in the sand between starting a business, being a freelancer, and even innovation and risk taking...and behaving "entrepreneurially".

    I'm also curious what makes you feel that entrepreneurs are missing out on their communities, causes, and education. If anything, I feel that the pendulum has swung the other way, where the most entrepreneurial companies are not just creating value, but affecting change and teaching others (and themselves) as a part of their efforts. Sure, there are LOTS of people out to build businesses for no other reason than to make a buck. Some of them win and some of them lose. But I've noticed a trend that the ones that continue to value higher purposes win on a much more consistent basis.

    I wrote about the Civic Entrepreneurship in the past, and I think it does a good job of encapsulating the values of community, cause, and education you describe. Maybe what you're yearning for is for the pendulum to swing in that particular direction?
  • Hey Alex - Your post on Civic Entrepreneurship was right on and made a big impact on me at the time. I would like to see the pendulum swing more that way. Even more, I'd like to see entrepreneurship treated as a methodology independent of the particular application of it (business, civics, non-profit, politics, universities, ideas, etc).

    I think you're right that businesses with a purpose have a competitive advantage. This is something I've been wanting to write about and probably will before too long. Still, there are two trends that unsettle me. I wonder if you're seeing anything similar:

    1. Many entrepreneurial companies see their social contributions as something they do philanthropically, outside of their businesses. I was this way with TicketLeap and partially with Anthillz -- I say partially because Anthillz began with a vision for social impact. I wish the social contributions were baked into the core business.

    2. Entrepreneurial thinking has barely penetrated outside of business. This is part of the reason I want to disentangle the term entrepreneurship from commerce. I want change makers in other disciplines to use it without having to explain themselves so much.
  • This comment builds off of your second point in the previous post. I'm curious to how you disentangle entrepreneurial thinking from entrepreneurial methodology. How would you define it exactly? If I loosely define entrepreneurial thinking as the ability to be creative and take risks, creating new opportunities from traditionally isolated disciplines / established models of business then I would disagree with your statement.

    From my experience in academia entrepreneurial thinking is a cornerstone of progressive scientific thinking. While there are some researchers that stay within the boundaries of their theories and disciplines, more common in historically established disciplines (economics, psychology, etc), there are a few others that seek to building new disciplines, new research centers, that study new phenomena. These researchers face the same problems as entrepreneurs, an uphill battle for acceptance, perhaps even ridicule by the establishment that cynically views new ideas until recognition permeates the greater scientific community. I would contend that what you call entrepreneurial thinking is the same impetus behind these researchers, the motivation and willingness that propels their journey to seek out new knowledge despite the risks and ridicule.

    Again I draw this corollary because I don't think this process is unique to business or academia, I think entrepreneurial thinking is a common tenant of our society, at least from our perspective in Western Culture. While the methods themselves may be different, and unique to each context, the premise of entrepreneurial thinking is common. To extrapolate further, I guess what I'm trying to articulate is that entrepreneurial thinking and methodology will always face an uphill battle against the established paradigm. This is both consistent with the scientific process and the process of the business world.

    I mean really, if being an entrepreneur wasn't such a challenge, would it be as much fun?
  • Hey Ben - You definitely have my mind churning, great comment. Prior to your comment, I hadn't thought too much about what entrepreneurial thinking might look like in the academy, and I'm not sure I have much insight yet. My gut agrees with you though.

    It does strike me that there are some obvious examples of entrepreneurship in the academy, especially with researchers building movements around new disciplines. Examples from your world might include the pioneering researchers who made video games, robotics and human-computer interaction each legitimate fields of academic study.

    In other disciplines, the recent Positive Psychology movement comes to mind as does the much older osteopathic approach to medicine (from the late 1800s).

    I'm very curious about this now...
  • Blake, I like this line of thought and hope it inspires discussion. I don't wish to dilute the meaning or significance of what it means to be an "entrepreneur" as it is an endeavor I respect, admire, constantly aspire to, and one to be very proud of...BUT, I believe our collective use of the "entrepreneur" label itself may be part of the problem as it's possible we've been taught INCORRECTLY that only certain kinds of people are capable of being an entrepreneur, and others aren't, as if an "entrepreneur" is a certain breed of person. Whereas, I like to believe every single person on this planet has an "inner entrepreneur", but for whatever many reasons, too many don't allow it to manifest. To paraphrase your blog post, and to kick off a potential line of discussion resulting in possible solutions to the questions you've posed, I'd call for a massive effort towards the "Entrepreneurialization of Thought"...meaning, let's find more ways to champion the spirit and instill the principles of entrepreneurial thinking while simultaneously moving away from the practice of labeling people as entrepreneurs. Let's embed an entrepreneurial attitude into everything we do and think about, from teaching, to learning, to collaborating, to building and managing organizations, to organizing activities and events, to consuming and producing products and services, to organizing communities and running governments...you name it. It's a REALLY big topic to chew on, and I look forward to seeing what thoughts others have.
  • Hey Cliff - I really like how you widen the scope even farther. Where my blog post talks about understanding entrepreneurship as a methodology and way of thinking (a means as Tal puts it), you want to make that approach so pervasive that it would be silly to give it a name. It would become a core part of the culture.

    Your point about everyone's inner entrepreneur reminds me a lot of DreamIt founder and Congressional candidate Steve Welch. He likes to say, "We are all born entrepreneurs."
  • Great post Blake. I agree entrepreneurship is a frame of mind, but I don't think it's the starting point that only finds a channel later.
    I never was the kind of kid who started lemonade stands and tried making a quick buck, I really liked inventing stuff, and three years ago I realized that inventions only amount to anything if you can distribute them well, so I applied to dreamit to start a business. So too with people who grow up deciding they want to change education in america, write movie scripts, do medical research, run for office, or make billions of dollars - entrepreneurship is just a means. Passion comes first.
    -Tal
  • Hey Tal - The means/ends distinction you make is a really important one. I also like your point about how any invention or impact you have is worthless unless it's distributed. This also relates to what Alex writes about the concept of scalability inside Josh Kopelman's definition of entrepreneurship - that you have to decouple value creation from your own time contribution. Value creation only happens when you distribute your valuable product, idea or whatever to the people who value it.
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