Is Action the Best Measurement of Learning in Entrepreneurship Education?

Sep 19, 2010

I think the answer is yes.

What good does it do an entrepreneur to have a great idea and business plan, if he/she doesn’t know how to turn that plan into action?

The biggest hurdle I’ve seen to would-be entrepreneurs is the resistance to actively and consistently talking with customers.

Without a customer, somebody using or purchasing a product, the idea’s value is close to zero.

The ONLY way to get customers is to engage them in a conversation. At the very least, the customer gains an understanding of what your product is, how it can help them, and then decides to move forward. At the most, a conversation with a potential customer leads to deep mutual understanding and the decision to work together for mutual benefit.

The more conversations you engage in, the more customers you get and the more you learn about your customers.

What often stops people from talking to customers is not lack of knowledge. It’s because talking to potential customers is outside of one’s comfort zone.

It’s hard to realize this basic fact because people veil it in excuses.

They say they don’t have enough time, money, or knowledge to start a business.

In reality, talking to customers doesn’t cost a lot of money, require a huge amount of knowledge (you should be listening 80% of the time), and takes very little time.

Most entrepreneurship education courses and curricula don’t realize this and, in so doing, do students a disservice.

I think one of the biggest benefits an entrepreneurship course could offer is FORCING students outside of their comfort zone until they become comfortable and skilled at talking to customers. Most students would NEVER take this kind of action on their own without this sort of accountability. If a course did nothing, but give this confidence, then I think it would have to be considered a success.

Getting those first few customers provides critical inspiration to the founder(s) and also gives initial proof to would-be stakeholders (investors, employees, partners, etc.). That is massive momentum.

Many entrepreneurship courses end with the creation and presentation of a business plan. While this certainly does inspire some students to action, I would wager that the percentages are extremely small.

What do you think the best way to measure the success of an entrepreneurship course is?


Sep 12, 2010

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Sep 5, 2010

Intimacy as the #1 Path to Growth

Jul 18, 2010

When I reflect on my life and what I’ve grown from the most, I look at many things…

…my father’s death when I was eight years old,

…being one of the best tennis players in my state for my age,

…finding the world of entrepreneurship,

…going to college and living on my own,

…becoming 100% financially independent,

…doing a 10-day silent meditation retreat,

…becoming a father.

But, what I really look at is my relationship with my wife, Sheena.

In a little over a month, we will celebrate our 10-year anniversary with each other (we met during freshman year orientation at NYU).

We can never experience more intimacy with another human like we can with our life partner.

There is not one secret about my past or who I am that I wouldn’t be willing to share with Sheena.

Sheena sees me at my best and worst times that no one else has ever seen me at.

She has known me in different phases in my life in many different ways (best friend, parent, lover, business partner, and spouse).

The institution of marriage when with the ‘right’ person and properly respected is extremely powerful. It means that I commit the rest of my life to this other person no matter what happens, I’ll die or die trying before the relationship ends.

In other relationships like a business partner, friend, or parents, it is much easier to walk away when things go down hill.

Our partner is the best window we have into our own lives. We can fake it with other people, but not the person we fall asleep with day in and day out.

I’ve also not experienced anything as challenging as intimacy. Almost every single day, we do something inadvertently to hurt each other whether it be a miscommunication, forgetting something, being too wrapped up in ourselves, being stressed, or being tired. They are the most inane things, but can trigger deeper insecurities that we each harbor. Oddly, each of our insecurities seem to spark the other person’s. At worst, these type of arguments can lead to both of us saying things that we never thought we’d be capable of.

When arguments happen, the easiest thing to do is to walk away or to go with the anger you’re feeling and to blame the other person.

These ‘arguments’ are gifts. They are opportunities to fully confront ourselves, to ask for and grant forgiveness…to be open to truly listening to the other person’s point of view without thinking of how to invalidate it. To realize that we’re on the same team aligned for the same purpose. It is an opportunity to take 100% responsibility for ourselves, which means that we stay present to our love no matter what the other person does or says.

Marriage takes work. It requires healing ourselves every single day. I have trouble seeing how intimacy could work over the long-run without both sides being absolutely committed to personal growth.

People often see marriage as something scary that ties us down. In reality, it gives us the opportunity to heal ourselves like nothing else. This healing gives us freedom to know ourselves a deeper level than we ever could have otherwise.

When we heal ourselves, we heal the world.

In the end, I just cherish the gift of being able to walk down the road of life with someone that I love unconditionally.

True Freedom Is Another Word For Having Nothing Left To Lose

Jul 18, 2010

In my opinion, I think many of the popular definitions of freedom are very shallow.

More choices don’t necessarily lead to better choices.

The person who focuses on one passion or field will almost always have a more successful career than the person who hops from career-to-career trying to always keep their options open.

Hopping from one relationship to another relationship without facing our own securities, forces us to essentially have the same relationship over and over at some level.

I have almost always performed my best when I felt like my only choice was to grow as a human being. Knowing that I only had one choice took away all the mental garbage of wondering whether or not I was making the right decision or I could succeed.

True freedom comes when we stop chasing shiny objects and focus on what really matters.

The Foundational Skills Of Entrepreneurship Education

Jun 30, 2010

On the college market, there is a lot of interest among students for entrepreneurship. A 2005 poll from Junior Achievement (JA) found that 68.6% of the teenagers interviewed wanted to become an entrepreneur.

What I’ve actually found is that the large majority of students interested in entrepreneurship, are just interested in exploring it for the future rather actually starting now.

With that mind, what do you think should be the foundational curriculum for students who want to just get the tool set now? I’d love your thoughts in the comments.

I’ve narrowed it down to the following:

  1. Mentorship. Traditional and peer mentorship have really been game-changing for me. A good mentor can be the difference between business success and failure. A good mentor can knock off years and even decades from the learning curve. What I’ve learned through talking with students is that most students have never been taught the importance of mentorship or how to attract and build a relationship with a mentor.
  2. Time Management. As I wrote in a recent note on time management, there is a huge difference between time management in school and entrepreneurship. In short, being an entrepreneur requires a completely different way of managing one’s time. Instead of being told what to do, the entrepreneur must be able to prioritize what’s most important overall and on a daily basis.
  3. Goal Setting. Goal setting is very much a skill. It requires setting a vision, knowing your values/strengths/passions, and then working backwards to very specific short-term and daily goals. By far the biggest question I get from students at our events is, “I want to get started, but I have no idea how to!” With the right training in goal setting, people would have a framework to be able to start on very big projects they know nothing about without feeling overwhelmed.
  4. Basic Understanding of What to Expect. A lot of people start businesses to get away from corporate politics or a bad boss, to have more freedom, to increase their earning potential, and to pursue their passion. People don’t realize the challenges, realities, and requirements of being an entrepreneur. Knowing these upfront helps to ensure that the right people start businesses and they keep going through all the ups and downs.
  5. Opportunity Recognition. Seeing opportunities where others see challenges is fundamentally a different way of looking at the world. People who only see challenges have trouble coming up with ideas. People who only see opportunities have more ideas than they can handle. Although, diametrically opposed, the two are actually not that far apart. Identifying problems is actually the first step of opportunity recognition. The business solution to those problems is the opportunity. Finally, training is necessary on what makes an opportunity a good one.
  6. Customer Development. Once you have an idea, it is critical to be able to validate it with potential customers. Fortunately, the customer development process developed by Steve Blank, serial entrepreneur and Stanford professor, gives a systematic way to do this.

In the end, I don’t necessarily think any of the points above are ‘requirements’ for starting business. There are certainly examples of successful entrepreneurs who didn’t understand one or more of these before starting. However, I think they are biggest things a potential first-time entrepreneur can do to minimize ahead of time to minimize the risk of business failure.

You Don’t Have to Start a Non-Profit to Make a Difference

Jun 29, 2010

In my opinion, non-profits are not always the best way to start a business whose main goal is to make a positive impact in the world. Furthermore, having worked in the non-profit industry, I believe that there is just as much ego in non-profits as there are in for-profits.

It is very unfortunate that people think that business in and of itself does not create social good.

Think of what a transaction is at its core. It is two parties coming together and walking away with mutual benefit. The scaling and vibrance of the free enterprise system is what has knocked our standard of living out of the park in the last century. Large companies are former small companies that were able to scale this impact and create even more good for society. Businesses create jobs, buy goods and services from other companies which in turn employ people, and create innovation that improves people’s lives.

The problems we hear about business are not because people have the ability to freely buy and sell from each other. The problem is that people misuse that freedom and act out of integrity. The same is true for money.

Successful entrepreneurs and companies look at the life-time value of customers, not just the value of each transaction. Entrepreneurs have an extremely strong incentive to treat their customers like gold so that they’ll stay with them. The more competition there is, the more companies must improve what they offer to the customer. All of these incentives are healthy for the world.

It is easy to sell $10 for $1. The problem with this is that it’s not sustainable or scalable. By making a profit, you’re able to invest in improving and scaling your company and product/service.

I’ve been poor. I’ve had $30,000 in credit card debt and tens of thousands in student loans. I don’t think there is anything glamorous about it. Money’s impact certainly tapers off at a certain point. However, it allows you to invest in your education in and out of school, invest in your children’s future, eat healthy foods, invest/donate in companies that make a difference, live in an environment and neighborhood you’re proud about, and much more.

Non-profits are:

  1. Harder to scale. Non-profits are not able to raise money via equity, which is the main way high-growth, for-profit companies raise funds. This drastically reduces the speed at which and size to which many successful non-profits can scale.
  2. Harder to attract talent with. Non-profits cannot offer equity to potential employees and executives. Ownership is where over 90% of the the wealth in this country is, and a non-profit isn’t able to let its employees take advantage of this. There are many talented individuals who want to make money and a difference.
  3. Harder to exit from financially. If you start a non-profit that changes the world and devote 40 years of your life to it, you will not be able to sell your shares in the company. While you can still earn a high salary as a non-profit executive, you may still have to worry about retirement, despite the huge success of your organization. Furthermore, while you’re worrying about your own retirement, it may be harder to focus solely on how the business can make an impact.
  4. Not able to switch to being a for-profit. On the other hand, if you realize that your social purpose for-profit company is not viable in that structure, you can turn into a non-profit.
  5. Sometimes a hindrance to a healthy market forming. Non-profits providing free or subsidized products or services may impede a healthy, competitive, scalable for-profit market from forming, because prices are too low.

Of course, I love non-profits too! I plan to start one in the future. They play a critical role in the world. There are many markets where it is not possible for a for-profit to exist, yet there is a huge social need that is not being met by the government. Non-profits have played a critical role in my own life personally.

I just think that is unfair to label profitable businesses and individuals as greedy.

Common Mistakes Made By Beginning Entrepreneurs: Over-Estimating Money Needs

Jun 29, 2010

Many first-time entrepreneurs with only an idea ask me how to raise hundreds of thousands of dollars. Bad idea! Most of the time, the real problem is not money, it’s the way you’re thinking about your business.

Contrary to popular thought, entrepreneurs don’t enjoy taking lots of risk. Great entrepreneurs minimize risk as much as possible. I’m assuming you want to be a great entrepreneur. Right?

When you’re just starting your business, your idea is essentially a bunch of assumptions (ie – If I do x, then so-and-so will do y). Most of these assumptions will be wrong. Even successful experienced entrepreneurs will have many incorrect assumptions about their business idea.

With that in mind, a few questions should come up for you:

  1. What assumptions are critical to your idea working?
  2. What’s the best way to test those assumptions to find what actually does work?
  3. How much will it cost to actually test these assumptions (time and money)?

It does NOT make sense to test all of these at once. You should start with the most critical assumptions first. As you prove assumptions, you not only reduce your personal risk, but those of potential future investors.

For example, let’s say you want to start a restaurant. Let’s say your assumption is that you grandma’s recipe will keep people coming and will create word-of-mouth. Well, you don’t need to have a restaurant to test how effective the recipes are. You could sell the finished product to multiple restaurants. You could sell it online. You could provide catering. All of a sudden, you need VERY little money to get started. Meanwhile, you’re proving your critical assumption, you’re building a fan base, and you’re improving your odds of bringing on great partners and funders.

When we wanted to start the Extreme Entrepreneurship Tour, we didn’t run out and purchase an expensive tour bus and spend $10,000 to wrap it. First, we created a basic web site and a powerpoint sales presentation. Then we spent a whole year signing up ten schools and getting paid upfront. Only then did we make most of the startup investments in the business.

The best way to fund your business initially is through your customers. You don’t have to pay them back. You don’t have to give up a percentage of your company. Finally, you prove that your product/service is valuable. Contrary, to popular thought, customers are willing to pre-order products/services if presented correctly!

For more on this process, read up on customer development.

Family and Entrepreneurship Can Be Balanced

Jun 28, 2010

If there is one thing I’ve learned about family and entrepreneurship over the past two years, it’s that having the best of both world’s is definitely possible.

When Halle was born, we actually hit a low point in the business. We raised more money in debt. We were just entering the recession.

I certainly had the temptation to work even harder, but fortunately I didn’t, because I couldn’t.

Since then, our business has more than doubled in size each year, I’ve made a major cut in the amount of hours I work, and my wife and I watch our daughter full-time!

There isn’t one magic thing we did.

All I can say is that when something is a MUST, it generally finds a way of happening.

If family and business are a MUST, they will happen.

The Difference Between Real Confidence and Cockiness

Jun 28, 2010

Real confidence is not needing references, testimonials, and credentials saying you’re awesome. You already know it.

Real confidence is having seen the worst of battle and walking just as tall or taller than you did before.

Real confidence means seeing the equal humanity in all people and, therefore, not bowing down to others, because they have more experience, glamour, or awards than you do.

Real confidence means saying the truth and standing behind it.

People with real confidence command attention via who they are, not what they’ve done.

Once we understand who we are, we can’t help but have real confidence.