Entrepreneurs aren’t primarily risk-takers; their main mindset is something else entirely

Entrepreneurship isn’t about taking risks

Entrepreneurship is all the rage these days, and I’ve had a lot of people ask me if they have “the right personality type” to be entrepreneurs. They think entrepreneurship is about risk-taking. Entrepreneurs must love risk, right? Since obviously, corporate employees love safety, and they’re the opposite of entrepreneurs. This sounds like a great story and a great rationale. It’s just wrong.

Entrepreneurs generally are not huge risk takers. Indeed, non-monetary considerations are often more important. In fact, many entrepreneurs try to minimize risk. What makes them different from corporate employees is that entrepreneurs maximize experimentation.

A business starts with an idea for a product or service that benefits some market: pink widgets. The business launches the widgets, trying to sell them to football players. No one buys. So they make some blue widgets. Some football players buy, but unexpectedly, many teenage goth girls buy. The next year, the company tries selling blue widgets to teenage goth girls in a different country. They sell tons. They’ve found their product (blue widgets) and their market (teenage goth girls). Now they expand into more and more countries, creating billions of the same products to sell to the same market.

In the early lifecycle, the startup is rapidly experimenting and testing the product idea and the market. Once they’ve found the combination that works, the mindset shifts from rapidly-experiment to scale-the-business. Scaling requires getting good at doing the same things over and over and over. Suddenly, it’s all about doing the same thing over and over, getting better as it goes.

This is a profound shift. Experimentation needs quick decision-making, creative thinking, and a willingness to cut corners as long as you get the learning you need. Scale requires rigor, process improvement, and a willingness to have single-minded focus, and tweak the details so you can be as efficient at mass-production as possible.

That is what you need to assess when deciding whether to pursue something entrepreneurial. Yeah, it’s risky if you don’t control your costs. But that’s only part of the equation. Think less about taking risks, and more about doing experiments. Because at the end of the day, entrepreneurship is about minimizing your risk while maximizing the learning you get from rapid experiments with your product and market.

How everyone can use powerful coaching questions, with Michael Bungay Stanier

How everyone can use powerful coaching questions, with Michael Bungay Stanier

In this episode of Business Explained, I interview Michael Bungay Stanier, author of “The Coaching Habit: Say Less, Ask More And Change The Way You Lead Forever.” We discuss how to use some truly powerful coaching questions to boost your ability to help others.

How would you know if you’re evil?

It’s almost Halloween, which means it’s time to confront our fears…

The Evil Queen stood in the doorway. The terrifying thing wasn’t the smoke rising from her hair, the sinister red glow emanating from her fingertips, or the half-eaten apple rolling on the ground beside the body of Snow White in the background; it was the look of naked vulnerability on her normally regal face. The source? The crumpled paper clutched in her right hand: the results of her 360-degree evaluation.

The Evil Queen doesn’t think of herself as evil. Neither does the Tasteless In-Law. They may always show up with the best of intentions, but they just don’t seem to “get” that bringing fireworks for the kids’ birthdays is just awkward. Or how about that yearly impression at the Thanksgiving dinner table that, in the words of Avenue Q, is “just a little bit racist?” They can’t fathom that some things are just … inappropriate.

Unfortunately, there are times in our lives where we’re probably the ones with cringe-worthy conversation, only everyone’s too polite to tell us. After all, those fireworks seemed like a perfectly appropriate gift for little 7-year-old Sydney. There’s one way to know if we’re That Inappropriate Person, however, and it’s the scariest thing we can do: ask.

Approach a friend, family member, or colleague. Simple ask, “I want to be the best friend possible. Can you tell me how I’m doing? Please be honest. What can I do better?” If they have hard feedback to hear, it’s probably just as hard for them to say, so take it well! Write it down, smile, and say “Thank you.”

Realize that other people see us differently than we see ourselves. You may think you’re a Superhero fighting for Good, but the people around you find you a bit more of a Monarch of Evil. By finding and closing the gap, you can bring yourself closer to making the outside you match the Superhero You.

So get moving! Use the answers! Read over the list of feedback. Choose one thing to change, and for 90 days, change that one thing. Then when you’ve mastered it, go on to the next thing (trying to accomplish all the goals on the list at once is just too much). Then ask again, to find out if you’ve made the change.

This even works for the Evil Queen. She’s learning. She’s decided to lay off the poison apples and put her efforts into doing good deeds, like finding homes for orphans. She says there’s a gingerbread house just beyond the stream that is happy to take as many orphans as she can send over. It isn’t perfect, but it’s progress.

The Right Conversation will Get You What You Want

If you want to change your life, how do you do it? I used to think it was hard. Then I realized that most of the opportunities in life have come through one simple activity: talking to people…about stuff. Who you talk to, and what you talk about, ends up building your reputation, and gets people thinking of you in ways that lead to new opportunities.

You don’t always have the power to talk to the right people, but you always have the power to talk about the stuff you think is important. Once you start talking about what you care about, you quickly find the other people who care, too.

People Will Self-Select

Start by changing the conversation with your current group of friends and colleagues. They’ll make it clear really quickly if they’re the wrong audience.

A mid-50s postal clerk called for career coaching. She’s close to retirement. In her spare time, she’s designed a low-cost, easy-to-assemble housing unit she believes could revolutionize third world housing. Her co-workers all pooh-pooh her idea: “You should realize you’re just a postal clerk with delusions of grandeur. At your age, you should just be thinking about retirement.”

Those weren’t the people to talk to. Talking to me was a good next step. I don’t have third-world housing connections, but I know people who do and can refer her. She changed her conversation and is already getting closer to people who can help realize her dream.

Jump on Opportunities

Be on the looking during the conversation, and pounce on opportunities as they arise. Last year, I was going through career angst. The only things that seemed exciting: theater and saving the world. Sadly, theater is tough to make pay, and there weren’t any save-the-world job openings on Craigslist.

I was talking with my friend Jason about my desire to save the world. Lo and behold, he had just been tasked with the job of … creating a conference to save the world! Hosted by MIT, the SOLVE conference would convene movers and shakers, technologists and policy makers, and be about initiating real action to solve world problems.

I immediately asked to get involved. I presented my ideas to the SOLVE team, and was given an invitation as an attendee to SOLVE 1.0. Will SOLVE be the right vehicle for me? Who knows. But one way or another, it introduces me to a new community to talk to, who share my concerns and aspirations. And therein lies opportunity.

Change Your Life

Now it’s your turn to change your life by talking to people … about stuff:

  1. What change do you want to make in your life?
  2. When you’ve made the change, who will you be talking to? About what?
  3. If you can reach those people directly, pick up the phone.
  4. Otherwise, start having the right conversations, and let people guide you to the right audience.
  5. If you run out of people and still haven’t found your tribe, try Facebook, LinkedIn, Google, etc.

Laziness Expands to the Maximum

Are you lazy? How lazy? I think technology is giving us opportunities to take laziness to an entirely new level!

I remember life before the Internet took over. Many things have changed. Now we can buy stuff online. We can watch movies and TV shows on our computer instead of our TV, when we want them. And we have access to an incredible wealth of the world’s information by simply visiting a search engine like DuckDuckGo.com and typing a few keywords. We can store infinite photos in our iPhones. We can use templates to quickly create presentations and reports. All that automation should be freeing us up to get smarter than ever. But that isn’t my experience.

Our brains take shortcuts. For example, it’s hard to know if someone is competent. So research shows that we interpret confidence as competence. Our brain substitutes the easy decision for the hard decision. We aren’t even aware of this consciously, however. That’s why certain professions wear suits—to give clients the knee-jerk impression of competence, even if none exists.

In the last two days, I’ve had a few younger people demonstrate a remarkable laziness factor. Whereas someone in my generation wouldn’t look something up because it involved going to a library or calling a reference librarian on the phone, these younger people tell me they did a web search and couldn’t find the information they need. So they stopped trying. Without an answer delivered up instantly, even in the age of the Web, kids who have never known anything else get stopped in their tracks the instant their preferred method requires extra effort.

Of course, if it’s happening to them, it’s probably happening to me, too. Where once I wouldn’t have minded picking up the phone and calling someone to arrange a meeting, now it’s just easier—and lazier—to send them a million emails, even though objectively, it’s far less efficient. That’s because my new standard is twitching a finger and clicking a mouse button. By comparison, lifting a phone to my ear is a huge amount of work.

Be on the lookout! In the long run, our in-the-moment laziness may seriously hamper our ability to get big-stuff-done. Our brains are substituting the question “is this easy to do right this instant?” for the question “will this make reaching my overall goal any easier?” And it’s the latter question—the one our brain skimps on—that is most important. It’s the one that will help you reach you goals.