Daniel Tenner - The crazy risks of being an entrepreneur
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Presentation held by Daniel Tenner on topic "The crazy risks of being an entrepreneur" at Startup Academy course in Belgrade. More details at startapakademija.com.
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Daniel Tenner - The crazy risks of being an entrepreneur
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- 12. A horrible and violent death.
- 13. Just one shot.
- 15. An incredibly scary ride.
- 16. A heroic act!
- 24. Jack Dorsey
- 25. Sean Parker
- 26. Max Levchin
- 27. Steve Jobs
- 37. The truth?
- 43. ...
Editor's Notes
- I’d like to kick off by offering some perspective about what it’s actually like, in terms of risk, to be an entrepreneur // But first, a bit about me... // with startup advice, important put things in context
- I’d like to start by sharing a story. // Like all good stories, it has a great protagonist, engaging, friendly, intelligent, good looking. Me! // It has twists and turns, and through the story, the protagonist learns some valuable lessons with which he overcomes adversity and then lives happily ever after. I'm still working on that last part...
- The first part of the story is depressingly predictable. A long time ago, in a galaxy far, far away - all the way in London, I had a fairly boring and predictable job... // Not satisfied... I had an idea of starting a business to escape... Friend of mine approached...
- And so I became a startup founder, though I didn’t even know it at the time! // Finally achieve my ambitious dream of... // Why doesn't everyone do this? // Montage... // My friend was very good at marketing...
- In essence, it was a disaster. End of the first act. The protagonist has taken a good kick in the butt and is struggling to make it to act 2. // Luckily, I had another friend, with another idea. And this time...
- So, this second startup was called Woobius, and we got users involved right away. ... // The product kept growing... // We switched on the billing. // What we found was quite a surprise... // Other customers, money was not the problem, but they wanted a different set of features!
- Painful experience, learn that price is a selector. Freemium myth - free users rarely convert, especially in B2B...
- Now I am running my third business, and this time we started with sales first… // This one is working ok so far! Profitable, hiring, growing, etc. // So this one is looking good! Gets a thumbs up!
- It means that finally, I can live my true dream, which I’ve now discovered consists mostly of giving a lot of money to Apple on a regular basis. // If you take just one lesson from this story, take this: closing the loop. // until you close the loop, the risk is high.
- Now, with those three companies under my belt, I have a little bit of experience of what it means to jump off the plane into entrepreneurship... so let’s get back tot his topic.
- Common Image, metaphor... // has a number of implications...
- Keep short, don’t mention images shaping how we think. Default is that you’re going to plummet to the ground and be flatter than a pancake.
- Keep short. Pancakes don’t get to jump out of airplanes.
- Keep short.
- Keep short.
- If so incredibly scary, it must take exceptional people to do it! Keep short.
- Most pernicious of all... // (Keep short!) // So, let’s take this point by point...
- Horrible and violent death... // Not meant to be taken literally, but the images we use shape our thoughts and our behaviours.
- Reality is that learning to run a startup is more like learning to ride a bike. // And there are things you can do to reduce the risk.
- End of a startup often feels depressing *and* exhilarating...
- This brings us to an interesting myth in the startup scene, the myth of the serial entrepreneur... // compress 40 years of work into 4?
- You might give the counter-examples of Bill Gates and Mark Zuckerberg...
- If you’re that successful, entrepreneurship won’t be about compressing 40 years of work into 4, but about compressing 400 into 40!
- As long as you don’t hit yourself in the face too hard, you can keep swinging.
- The “sink or swim” or “jump out of an airplane” metaphor convey the idea that either you make it or you don’t. It’s heaven or hell - nothing in between. // Most of you - probably all of you - will not become billionaire entrepreneurs like Zuckerberg or Gates. // Most..... will not end up begging on the street for food! // Most of you, probably all of you, will end up somewhere in between those two extremes.
- Success is often defined as a binary thing... but it’s not. It’s very relative. You don’t need a billion dollars, or even a million, to be successful.
- Are there scary moments? Sure... // But jumping off a cliff, for people who enjoy that, the whole point of it is the thrill, the scare... In entrepreneurship, the scary bits are the bits you try to avoid.
- Why do we think entrepreneurship is scary? Campfire horror stories.
- People tell each other scary stories to reassure themselves that they made the right choice.
- Next, is starting a company a heroic act? I like the idea, it’s flattering, but I work with many entrepreneurs and very few of them can be called heroic or superhuman.
- Average entrepreneur looks just like you or me. Average new entrepreneur looks even less heroic! You don’t need to be Steve Jobs to start a successful business.
- I’ll get back to that one later. First, I want to talk about ... >
- What does it really feel like? // Ask any wannabe entrepreneur just before they “take the plunge”, and they’re usually shit-scared, though they may pretend otherwise. // Ask them a year later, and they’re having the time of their life, they’ve never felt so free, they love it, they can’t imagine doing anything else. // You don’t spend most of your time as an entrepreneur scared and cowering. Here’s what you get to do.
- And so on! // Starting a new business is not scary, it’s exciting - or rather, it’s scary in the same way that moving to a new city is. There’s newness, there’s possibilities, there’s some uncertainty - all of which combines to making it a very exciting adventure, not a scary one.
- Finally, what I called the most pernicious idea in this metaphor... the idea that entrepreneurship is more risky.
- Again, this seems like an idea concocted by those who are not entrepreneurs, to validate their choices, which otherwise may not seem sensible.
- Often, the idea that entrepreneurship is scary is accompanied by quotes of startup failure rates... 40%... 70%... 95%... // Certainly, if you’re a startup, life seems pretty uncertain and scary. I’d hate to be a startup too. // Let’s look at the *career* from 3 angles: job sec, upside, and career sec But the good news is, you are not a startup. You are an entrepreneur, someone who creates startups. 2 out of 3 of my startups failed. Am I a failure? No. The third one is succeeding, and that’s what matters.
- Job security... can you be fired as an entrepreneur? // Sure, you might fire yourself, but you’ll see it coming! // In a corporate job, however...
- Upside... can you earn enough to extract yourself from the rat race? // As an entrepreneur, the upside is all yours. // As a corporate...
- Beyond job security, what about career security? // Not about whether you’re going to get fired, but whether your entire area of expertise is going to be obsolete // Just a few decades ago...
- Corporate careers are more insecure today than any other time... I read somewhere that the modern knowledge worker can be expected to retrain themselves in a new career up to 4 times in their working life. Technology is eating up everything.
- So what is the career of an entrepreneur like?
- More like being a scientist... // It’s not as sexy, but having the right vision for what it means to be an entrepreneur might help you make better choices in your first startup, second startup, third startup, etc.
- With that in mind, what are just two good principles for maximising your chances...
- First, realise that you’ll be doing this again and again - so don’t take stupid risks thinking it’s just this one time. // If you’re taking stupid risks today, you’re probably someone who takes stupid risks all the time - not a good starting point for a long-term career...
- You’re in this for the long term, so don’t take bets that are good in short term and bad in long term. Examples: unhealthy lifestyle, personal debt, risks that can kill/jail/discredit you. Instead, take risks that have low short-term downside and high long-term upside.
- Second, realise that there are many skills that go into a successful entrepreneur. // Won’t list them all here tonight, they’re on my blog...
- That’s all I have for you today... I hope this perspective will be useful to you. Thanks for listening.