Entrepreneurial ventures can remind us of babies. They seem to need constant care and attention, and even if they don’t for short periods of time we still worry about them. Although physical time off is possible, many entrepreneurs find they cannot mentally take time off from their businesses.
A study in StartupJournal.com reported that of the entrepreneurs surveyed “22% want to forget it all for a while and won’t check back with their company, but 33% will be calling in — or checking by e-mail — once a day, 22% several times a day, 17% every few days, and 4% weekly. For one small group, 2%, perhaps staying at work would be more relaxing — they’ll be calling in every hour.” Another article at the same site offers advice from a consultant on how to take time off from his business. But, his advice seems to imply that even proper rest is simply a way to improve performance when we get back to work.
Temperance is a virtue that is often forgotten about in today’s 24/7 world. This article from Inc.com describes the problem quite clearly:
“So, do you really need to be at the office 24-7??The most dominant myth of this society is the Protestant work ethic,’ says Al Gini, author of The Importance of Being Lazy. ‘Entrepreneurs say, ‘This is my baby. I have to do this myself with huge amounts of sweat equity.’ They’re right, but there has to be some moderation.’ Gini advocates taking time to rest, recreate, and re-create, but if that only means a few days off, checking in constantly before plunging right back into an all-consuming schedule, what’s the point?”
What’s the point, indeed? Being at rest is not simply a means of recharging your batteries for the next round of work. Rest nourishes the soul. Rest gives us the opportunity to focus on many things that are, dare I say it, even more important than our businesses. Family, faith, and friendships are not respites from work. But we too often treat them simply like a time-out from work.
If all we do–work, rest, sleep, recreation–are simply means to improving the financial performance of our businesses, our lives are not really being lived well. My good friend Mike Naughton tells the story when he was giving a talk about celebrating the Sabbath. An executive in the audience spoke up and adamantly stated that he could never “give up” Sunday–it was his competitive advantage.
As summer vacations draws near, take time to think about why you are doing all that you do. Why do you work? How do you rest? If all of your answers come back to your business it is time to do some genuine reflection on your life. Business is exciting, invigorating, and even fun. But, it is simply a means and not the ultimate ends in our lives. Temperance in our work can help put such things in their proper order.
Another Example of a Niche Bank
There are more and more niche banks popping up like mushrooms after the rain. They focus on serving women, hispanics, etc., etc. There is a new one here in Nashville reported in the Tennessean that is focused on Asian immigrants and health care. These banks are playing a significant role in our entrepreneurial economic boom.
The VC Myth
Part of the mythology of entrepreneurship is that VC’s play a major role in new venture development in this country. The myth has evry entrepreneur thinking there is a VC out there for them. I have met small retail start-ups that actually think they can get VC funding. (In case you still believe this myth yourself, there has never been a small retail business funding by VC money–ever!!). While VC’s play an important role, I would even go so far as to say a critical role, they are a niche player. They only work with businesses that have large capital needs and show great promise of very rapid growth.
Anita Campbell has a fascinating post over at Small Business Trends that really brings this to life. She cites a report stating that in 2002 only 38 out of 100,000 new businesses had VC money behind them. That is .038%! She also links to an article on VC’s over at Forbes.com that is worth a read.
What was most heartening was that she stated that entrepreneurs seem to be understanding that VC’s are not part of the real world for most start-ups. Maybe the VC myth is finally becoming debunked! Over 80% of funding comes from the entrepreneurs themselves and their friends and family. Most of the rest comes from a variety of sources such as leasing companies, limited bank financing, etc. If I were to draw a pie diagram of this, VC’s would be a really thin line at best. They are important, but not for the vast majority of entrepreneurs. I wish my fellow teachers of entrepreneurship would give up this myth and teach about what really funds most business start-ups. The VC process is complex and sexy so it makes great stuff for college classrooms. But, we need to get real and teach entrepreneurs about what is fact, not myth.
Fast Growing Companies include “good” entrepreneurs
It is encouraging to see that this year’s Entrepreneur magazine Hot 100 companies includes many companies that have integrated strong values into their company cultures.
“At a time when each day’s headlines seem to bring new corporate scandals to light, it’s heartening to know that being “good guys” has paid off for our Hot 100 companies. We were impressed by the number of entrepreneurs in this year’s listing who credited their success to their employees and spoke passionately about the importance of treating customers and staff well. Proving they not only talk the talk, but walk the walk, the number of companies offering employee benefits such as health insurance, 401(k) plans and stock options increased this year.”
Gas Prices are up, but there are now alternatives
Over at the Inc.com web site two articles caught my eye that seem to offer a problem and an alternative.
The problem: gas prices are going up and up and up, which is starting to pinch small businesses.
An alternative: new software makes virtual meetings over the Internet easy for small business people.
Although Inc.com didn’t link these two stories, I thought it showed the power of the market to offer creative solutions for those willing to look hard enough. We learned that price controls don’t work back in the Nixon era (I’m showing my age…). Gas prices are causing short-term pain, but let markets work and amazing things might develop! Maybe the market can begin to offer some alternative fuels sources and technological innovations. Who knows–maybe this crisis can lead us to a new and exciting era in our economic history. Every successful entrepreneur knows that out of chaos and change come opportunity.
MBA degrees under scrutiny in the market
An article in the Economist examines the softening of demand for MBA degrees. It argues that MBA’s curricula must be kept current and relevant. I can testify first hand the wheels of academia spin a little too slowly sometimes. The economy has been in a fundamental transformation that has take many twists and turns over the past 10-15 years, but what is clear is that this is now an entrepreneurial economy in terms of expansion and growth. Most MBA programs are just starting to reflect these changes.
What we have done for years here at Belmont is to require a course on Entrepreneurship in our MBA core courses. We don’t teach them how to be entrepreneurs–that is for another course. Instead, we teach them about entrepreneurship so they can better understand the driver of the current economic expansion. They will buy from entrepreneurs, sell to entrepreneurs, compete with entrepreneurs, and many will work for entrepreneurial companies, so they need to understand that these companies are different than the corporate giants that most typical graduate classes tend to focus on. Happily, I have found that many of my colleagues here do talk about entrepreneurial businesses in many of the classes they teach to MBA’s. Graduate programs need to focus even more on this perspective if they want to remain relevant.
Rob over at BusinessPundit gives an interesting reflection on his experience at the University of Kentucky. That is where I got my MBA, but my degree is about a quarter century old now…I sure hope things have changed in the UK MBA program since then!
Capitalism Meets Conservation
John Wamsley passionately believes in two things: the need to preserve native species in his homeland of Australia and the power of free enterprise. I stumbled across his story one day while I was reading a National Geographic story about him and the company he founded called Earth Sanctuaries, LTD.
Wamsley did not believe that government and charitable conservation was working. So he raised money in a public offering to create a company that would make a profit in the process of securing areas that would be free of non-native species, such as feral cats, rabbits, and so forth. He also created various means of revenue generation to create his business, including a ecotourism, lodging, a snack bar, selling non-threatened plants and animals, and so forth.
The start-up was tough, as many are, and Wamsley got some real life lessons about the power of markets to make or break your dreams as seen in the 2002 interview from abc.net:
?The Government conservation doesn’t work, and charitable conservation doesn’t work, and in fact, I still believe that it is the only hope our wildlife has, the only hope our environment has, is to commercialise it but there’s a long way to go and Earth Sanctuaries is the first experiment of this type and it hasn’t failed yet.
?I mean, I don’t give up that easy.
?But it’s hard and it’s going to be harder before we get there.?
By 2003 it became clear that changes had to be made if Earth Sanctuaries was to survive. Wamsley was a better conservationist than business person, so he hired professional management. The company is projected to breakeven in 2004, while still expanding its conservations efforts by buying more land to set up protected preserves.
The examples of non-profits trying to pretend to be entrepreneurs is everywhere, but this is one of the only examples I have even seen of a man with a vision that is usually assumed to be the domain of the subsidized non-profits trying to make it in the market of free enterprise.
I found examples on the web of media writers being critical of his efforts, ready to count him out at every stumble. But entrepreneurs do, and always will stumble. But, Wamsley already has succeeded. He has created many new areas that will conserve Australian species, created many new jobs, and shown that capitalism can be an effective mechanism to achieve conservation. In spite of his many early setbacks, he has been an effective entrepreneur and may yet also succeed in terms of his financial goals.
New Model Bank Program for Start-ups
The National Dialogue on Entrepreneurship has a report on a new bank program that could be a model for many communities:
“Traditionally, banks have been somewhat stingy about backing start-ups. But, a new program from Kalamazoo, Michigan may begin to change this perception. Southwest Michigan First, an economic development organization based in Kalamazoo has organized the Kalamazoo Bank Consortium for Innovation. Eleven banks have joined the Consortium, and they have all agreed to work more cooperatively with local start-ups, especially those focused on the life sciences. The banks will work with these firms to provide financing, to review business plans and marketing strategies, and to link new start-ups with business leads and other partnering opportunities. While this effort is quite new, it may offer a model for other communities seeking to expand financing options for entrepreneurial businesses.”
The web site for this program can be found here. This program is a very targeted initiative for the life sciences, but it could be applied to other settings and local economic environments.
Carnival of the Capitalists
I’m back from Boston and the Carnival of the Capitalists is up and running for the week. It is at start-up skills.com this week.
Small Business Trends
The NFIB has released a very bullish report on small business trends for May 2004. The employment outlook, capital expenditures, and general optimism about the near future are all continuing to increase with small business owners. This is more support for the robustness of this entrepreneurially driven economic expansion.