Entrepreneurship: Worthless, Impossible and Stupid?
Originally postedy by Vivek Wadhwa on LinkedIn, July 16, 2013
One of the best and most fun books I’ve read on entrepreneurship is by my friend Daniel Isenberg, titled Worthless, Impossible and Stupid: How Contrarian Entrepreneurs Create and Capture Extraordinary Value. Isenberg, who is a professor at Babson, challenges conventional wisdoms, presents great examples, and takes a global perspective. With his and the publisher’s permission, I am sharing this excerpt.
Entrepreneurship is a contrarian process in which the entrepreneur uniquely realizes and reaps extraordinary value by seeing its potential where others do not, largely because the particular constellation of factors at that moment is perceived by virtually everyone but the entrepreneur as valueless. But the potential extraordinary value becomes actual because of the entrepreneur’s ability to recognize, realize (as in “bring forth”), and then reap the value that no one else anticipates.
Entrepreneurship always entails overcoming adversity, usually in the form of market resistance or derision. When the world saw the automotive industry falling apart, Jay Rogers saw an opportunity for making cars in a different way; many savvy investors indeed thought the idea and timing were both way off. Fortunately for Rogers, private investors thought he was capable and smart enough to turn it into something useful.
There is nothing average about entrepreneurship. Entrepreneurship is not about central tendencies; it is about extremes. Entrepreneurship is not about what is likely; it is about what is possible. It is not about ordinary; it is about extraordinary. The common denominator of all of these accessible entrepreneurs is their contrarian perception, creation, and capture of extraordinary value. It is their recognition, realization, and reaping of more value than anyone else (the market) could have anticipated.
Lurking underneath this intuitively appealing definition of entrepreneurship lie some surprising, practical, and sometimes disturbing implications for entrepreneurs, policy makers and others. In this excerpt, I will focus only on the implications for entrepreneurs:
Always Have a Good Detractor. A really big opportunity will always have at least one really smart detractor, someone who is experienced and whose opinion you respect. If not, then it probably is not a big opportunity. Listen to very detractors; weigh their comments and warnings for their merit, and then think for yourself. But don’t make the opposite mistake of concluding that every disparaged idea is in fact a gold mine. Some scrap is toxic, and some trash does stink. The hard part, for which again there is no formula, is to distinguish a priori between real and imaginary worth, that is, between folly and value.
Keep Your Passion in the Bedroom. Most aspiring entrepreneurs who meet with me for feedback conclude their pitch with, “And it is an idea that I am really passionate about!” They believe that their passion gives them a greater chance of success and makes it more valuable. Lest the reader be confused, passion is not the same as a rational assessment that you have special person assets that can address, uniquely, a gap in the market. Passion is intrinsically irrational, even delusive, and it causes us to be blind (“blind passion”). Much of entrepreneurship is passionless. Consider the mindset of Abhi Shah coolly combing through thirty-eight “great” ideas before he began to settle on the legal-process-outsourcing concept behind Clutch Group. Imagine Gabi Meron rationally spending six months studying capsule endoscopy from every different angle, building a long-term plan but also trying to address every possible flaw in this radical new idea. That is why I often tell entrepreneurs, all else being equal, to leave their passion in the bedroom. That is where the dim lights, soft music, flowers, and candles create a distorted reality that can be very beneficial! But entrepreneurship is about objective, extraordinary value creation. Dreaming about what is possible is one side to the story and woefully incomplete without hard-headedness.
Don’t Complain About Adversity. Adversity is inherent in the process of bringing a worthless, impossible or stupid product or service to the market. Some adversity – exceeding bureaucracy, corruption, poor infrastructure, bad governance, low transparency, would of course enable more entrepreneurship in its absence. But the experience of fighting the market to gain customers, investors, talent, and other strategic resources, is going to almost always be an uphill battle, at least part of the time. Like the volcanic eruption in Iceland that disrupted air travel or the tsunami that displace millions, they are unfortunate, but facts to be taken into account, not complained about.
Study Stories. Can you teach unconventional wisdom? There are many parts to the answer to this question, but I will focus on just one of them—stories. If you suddenly discover that someone has done something that you previously thought was impossible, it can have a dramatic impact on your motivation to try; even more so if you also see how they accomplished it. If someone tells you that there really is a needle in a haystack, then you will be much more willing to search for it there and you will be less likely to give up until you find it. The mere experience of seeing these “ordinary-looking” entrepreneurs do extraordinary things has by itself stimulated dozens of my students to make the entrepreneurial choice, creating dozens of successful ventures around the world.
Reprinted by permission of Harvard Business Review Press. Adapted from Worthless, Impossible, and Stupid: How Contrarian Entrepreneurs Create and Capture Extraordinary Value. Copyright 2013 Daniel Isenberg. All rights reserved.