Worthless, impossible and stupid: the entrepreneur’s way
Originally published in Venture Burn on October 25, 2013
“If everyone tells you it is a good idea, run the other way,” Jay Rogers, Local Motors.
Here in the second part of our epic review of the book by Daniel Isenberg, Worthless, Impossible and Stupid, we take a look at crazy ideas and staying away from crowds.
The book, Worthless, Impossible and Stupid, is broken into four parts and in the next few weeks I will be publishing some insights from each part. The book takes the reader on a fascinating journey around the globe with some of the world’s most successful entrepreneurs. Their successes are explained in conversation with Isenberg, each laced with key lessons for budding entrepreneurs.
When it comes to starting a business, the temptation is to go for what is popular right now and what the crowd loves. Isenberg reckons this is not a good idea for entrepreneurs because, let’s face it, some of the most successful companies today started in “inauspicious economies or inauspicious markets”.
The way Isenberg sees it, entrepreneurs are not built to follow the crowd or what is popular. Instead, he reckons their job is to disrupt and make the unattractive attractive:
…one of the most important we want entrepreneurs to have is the ability to assess markets for their attractiveness prior to entering into new business lines or ventures: the more attractive, the better. Obvious, right? Evidently, this lesson does not hold for entrepreneurs, who failing to listen to the “experts,” time and time again transform unattractive industries in unattractive times into attractive opportunities. Entrepreneurs thrive in adversity; I guess they didn’t get the memo.
Entrepreneurs must be crazy, duh
In writing this book, Isenberg seems to have discovered the secret sauce of why entrepreneurs need to be crazy — the best are. Isenberg looks at Jay Rogers, the founder of Local Motors, a car company that allows the populace to design their own cars and then come to its factory to finish them off. A company born at the peak of the collapse of the automotive industry, when General Motors was getting a government bailout and Toyota was reporting its first ever loss, one entrepreneur was getting ready to disrupt an industry that was on its knees.
Rogers has managed to raise around US$12-million from investors and has sent out six of his flagship car, Rally fighter, “into the wild”.
In just four years, Local Motors has managed to convince paying customers that Rogers’s view of the market is right. Some 140 of them have ordered their Rally Fighter at about US$70 000 per car, with five per month (and increasing) regularly rolling out of the Local Motors microfactory in Phoenix and numerous special projects underway to build special car fleets for companies and license the Local Motors technology to large vehicle makers.
Isenberg reckons it would be difficult to ignore a pattern among entrepreneurs, namely “seeing value in situations that others disparage as worthless, impossible or stupid and, or contrary to what is expected”.
Some of the world’s most successful companies were once thought too ridiculous for anyone to take seriously, never mind investors. Companies like Google, eBay, Apple, Intel, FedEx and PayPal. Big venture capitalists such as Bessemer Venture Partners list these companies in their “anti-portfolio” — companies that it had the opportunity to invest in but passed on because the idea was just too crazy and possibly too stupid to invest in.
In the author’s view these are — to quote Apple — “the crazy ones” and, for entrepreneurs, being crazy is common value that allows them to “create opportunity where others see nothing”.