Why entrepreneurs will not save the world
May 31, 2012 by Guest Contributor
Callum Laing, serial entrepreneur and CEO of Fitness-Buffet, argues that articles like this recent Forbes piece Why Entrepreneurs Will Save The World reflect an unhealthy preoccupation with entrepreneurship and adds one item too many to an already busy-to-do list.
Years ago, I wrote an article for a newspaper denouncing the media’s growing obsession with entrepreneurs as the new rock stars. It was during a downturn and I pointed to the army of recently laid-off people who, unable to find jobs, re-branded themselves first as ‘consultants’ and then when that didn’t work as either ‘lifestyle coaches’ or ‘entrepreneurs’.
Inspired by whoever was on the cover of Forbes magazine, they would ‘find their passion’ and throw themselves headlong into building a business with the charming naivety and enthusiasm only a fresh entrepreneur can muster.
Within 12-18 months, however, most of them had burnt through their lifetime’s savings, often taking on personal debt, alienated their friends and family by trying to sell to or borrow from them, and closed down their businesses. They then return, tails between their legs, to the workforce to lick their wounds.
Perhaps those were the lucky ones. The rest of us stumbled on.
I am not simply giving a negative take on entrepreneurship. It is in fact the reality for most people who start businesses, where failure is a near certainty. And while all business owners may understand that intellectually, they won’t understand its true toll until they experience the death throes of a business, the unpleasantness of laying off staff, and dealing with unpaid suppliers.
Many years later and another downturn later, the media is once again full of stories of rags-to-riches entrepreneurs and the appeal of ‘freedom’, ‘making a difference’ and ‘saving the world’. A whole new army of people who should know better will throw themselves into creating a business despite facing the sort of odds that make casinos look kind.
So do I disagree that ‘Entrepreneurs Will Save the World’? Forbes makes no apology for the hyperbolic headline, yet in the same opening statement reveals they are actually talking about an ‘entrepreneurial mindset’ rather than entrepreneurship.
I would argue that you do not need to be an entrepreneur to have an entrepreneurial mindset. In fact it may be best for you not to start a business. Solving problems creatively has been done by the best employees since the Industrial age and you would be hard-pressed to find a CEO or business owner who isn’t focused on attracting and retaining the best minds to their company — and then providing them the environment to do the best work.
“The employee we mock often has resources we could only dream of and a mandate to use them in the pursuit of solving the problem.”
I believe in entrepreneurship. I have enormous respect for those that create and contribute. For those that leave it all on the line, succeed, and retain some level of sanity in the process. My peers on this journey inspire me every day with their accomplishments. I want entrepreneurs to be recognised by the press. I want people to be inspired and go out and start their own businesses.
However, the current glorification of entrepreneurship is bordering on sycophantic and I’m not sure it is healthy for either the entrepreneurs or the those aspiring to become one.
Entrepreneurs will save the world? Isn’t it enough to deliver value to customers, employees, shareholders and the community?
Proclamations like these fail spectacularly to prepare the next generation of entrepreneurs for the realities of the worthy endeavour they will be undertaking.
Religion, personal development, real estate, used cars all have suffered the curse of being oversold and the very word ‘entrepreneurship’ seems to be evolving in ways I can’t fathom.
It used to be that people who had created a successful business were entrepreneurs. Today, just being unemployed with an idea seems to entitle you to use that moniker.
In the Forbes article they point to protestors in the Middle East who ‘self organize’ entrepreneurially. One man’s freedom fighter is another man’s… entrepreneur? How long until a poor terrorist can rebrand themselves as a lean entrepreneur?
I don’t blame the writer Paul Brown and Forbes for this situation; my peers and I would gladly lap up the attention and are happy to pontificate to anyone that will listen about how clever we are. It serves our purpose well and flatters our sensitive egos. We tend to smugly revel in the fact we have the freedom to pursue innovation whilst others are constrained by ‘JOB’s (Just Over Broke) and office politics.
But it is convenient to forget that we are often ‘CB’ (Completely Broke) and trying to innovate while juggling a dozen plates (sales, marketing, HR, finance, IT, and dealing with your PA’s dead cat), whereas the employee we mock often has resources we could only dream of and a mandate to use them in the pursuit of solving the problem.
The age old adage about “Those that can, do; those that can’t, teach” gets trotted out despite the fact that the majority of scientific breakthroughs come from academia and not the private sector.
Academia is where employee scientists and engineers are free to pursue innovation without having to worry about how they will pay their staff’s salaries at the end of the month.
Can’t they save the world?
One of the key arguments of the Forbes article is what they call ‘Acceptable Loss’. In other words it is ‘fail often and fail fast’. Get a ‘minimal viable product’ out into the marketplace and learn from it. These are the trendy buzzwords in entrepreneurship circles these days and it is not without merit.
The premise is simple: No amount of past experience or market research is going to tell us what is going to be the next hit, so let’s get enough ideas out there and hope one catches light.
“Entrepreneurs already take ourselves and the games we play far too seriously. Let’s not build us up to be more than we are.”
Even venture capitalists are beholden to these ideas, but instead of building a minimal viable product, they focus on minimal viable entrepreneurs. Why give 30 companies $500,000 when you can give 300 companies $50,000? You only need a few of them to survive the hail of bullets they will face in order to get your massive return.
A raft of incubators are appearing all over the world with the same idea. Attract budding entrepreneurs with the promise of glory, drag out some battle-weary serial entrepreneurs like me to pass on knowledge about what has worked for us.
Show them how to point a gun and then push them onto the front line. If a few make it to the other side, we declare victory. The rest we hope have the fortitude to get over all the promises they broke and find the will to reenergise themselves and try again.
Or they could go and get a job.
Even governments have hopped onto the bandwagon; every country is at least paying lip service to encourage entrepreneurship on its shores.
Because entrepreneurs will save the world – or at least help the economy.
Phil Libin, CEO of Evernote, knows what it’s like to fail, yet today he heads a company valued at a billion dollars. Another poster boy for the industry? His advice to aspiring entrepreneurs is simple:
I don’t share his view. Seriously. But I empathize with it. The entrepreneurial ride is a crazy, unhealthy obsession with the promise of magnificent rewards that may not get realized. By comparison, being entrepreneurial while working for someone else has many benefits.
Entrepreneurs already take ourselves and the games we play far too seriously. Let’s not build us up to be more than we are.
Maybe one day an entrepreneur will save the world, but quite frankly most of us have plenty of other things to do first.
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