AVA, Entrepreneurship, Founders

Considering a Start-Up? Think Again.

This post was originally published in the Harvard Business Review blog on April 30, 2012. You can find that article here. 

It’s been a banner year for start-ups. With the JOBS Act, the rise of international accelerators, the upcoming Facebook IPO, and the mind-blowing $1 billion Instagram acquisition, you can be sure that droves of young, ambitious founders will be jumping on the start-up bandwagon.

The refrain is all too familiar: If you want to change the world and get rich in the process, then just go for it. In fact, in our book Passion & Purpose, several stories from young leaders involved start-ups. The problem isn’t what the message says, but what it doesn’t. What it fails to say is that the start-up life isn’t for everyone.

In The Lean Start-Up, Eric Ries talked about vanity metrics — numbers that create the illusion of success, rather than validate actual progress. In the same way, vanity entrepreneurs have deeply held illusions and misconceptions about the realities of start-up life.

Vanity entrepreneurs start new ventures for the wrong reasons. They start companies because it’s the cool thing to do. They’re hypnotized by the enormous myth-making apparatus of modern mainstream media, the coveted slot on Techcrunch, and the likes on their Facebook updates. They overestimate the glamour and underestimate the grind. And as ubiquitous stories of success spread in social media, these illusions become powerful self-delusions. All founders have this vanity within them, in varying degrees. In a way, it’s what drives them to succeed. What matters is the extent it takes hold of their judgment.

As founders can attest, what you encounter deep in the start-up trenches will be far from your mental projection and expectations of the future. The harsh reality is that being a founder is more an exercise in psychological readiness. In the intense ups and downs you’ll be going through, your emotional maturity will matter more than your skill set. It requires having the social intelligence to pick the right cofounder. It’s learning to live with lower pay and higher sacrifices in exchange for a very uncertain future benefit. It’s being responsible for the people in your team, taking the blame when they screw up, but sharing the credit when they succeed. It’s juggling to manage your team, customers, investors, and strategic partners all at once. It’s learning to balance the freedom creativity required to prosper with the operational discipline to hit the next milestone. Layer this on top of the usual personal and family pressures, and it’s hard to see how any sane person would choose this path.

So how do you know if you have a vanity entrepreneur in you?

You are attracted to titles. If you were always concerned about being “Managing Director,” you’re probably not ready to dive into a path that requires you to worry about everything from closing that deal to taking out the trash. A simple way to verify: See if that internship you had freshman year had an over-the-top title.

You need constant affirmation. As my coauthor Daniel Gulati pointed out, the typical corporate job is filled with variable rewards in the form of promotions, praise from peers, and publicity. In start-ups, you lose the vast majority of these positive reinforcement mechanisms. Validations of progress aren’t as clear cut. You need to be ready to endure the complexity when some pieces of data tell you that you’re wrong, while others say you’re doing a great job.

You believe a start-up is “good on the resume.” In a recent Techcrunch article, Geoff Lewis talked about the MBA who felt a start-up stint would be good for his growing list of achievements. “Even if the startup ends up going nowhere, graduating from Y Combinator would be such a great credential,” the MBA supposedly said. Think twice if your resume gets more share-of-mind than building great products.

Your lifestyle is keeping you from diving in. If the major stumbling block keeping you from founding a start-up is the need for financial security to buy that latest designer bag or go on that trip to New Zealand, then you’re probably not in the right mind-set yet. Not only will you need to take a pay cut and spend less, you’ll have to push your employees to do the same by thinking of creative solutions to conserve cash in order to stretch your runway. Bootstrapping is an art form, and your lifestyle choices will get in the way of that. Don’t force it.

We’re all susceptible to myths. The new zeitgeist is that entrepreneurship is the be-all and end-all path. But the first step in deciding whether to be a founder is to manage the vanity that’s in all of us, and not be blinded by the herd.

Key Takeaways

The first step in deciding whether to be a founder is to manage the vanity that’s in all of us. Tweet

Vanity entrepreneurs start new ventures for the wrong reasons. Tweet

The harsh reality is that being a founder is more an exercise in psychological readiness. Tweet

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Entrepreneurship

To Find Happiness, Forget About Passion

This post first appeared in the Harvard Business Review blog on January 13, 2012. You can find the original post – along with the interesting conversations in the comments section – here

Several years ago, a friend decided she wanted to follow her passion. She loved the liberal arts and academe. She was a talented graphic designer, a great writer, and was the president of a student club. But the prospect of working a nine-to-five job was never interesting. I can’t blame her. After all, ours is a millennial generation proselytized to pursue our dreams. So she spent seven years getting a PhD, writing an award-winning dissertation in the process. It was a wonderful ride while it lasted, and she was among the happiest people I knew.

Then the recession hit. The value of university endowments crashed. Teaching and research positions were cut. She moved back in with her family, stopped paying off her student loans, and waited two years before getting a minor teaching role in a small research center. Throughout this time, she suffered the anguish of an uncertain future, became socially withdrawn, and felt a sense of betrayal.

It’s a poster tale for our times. Was following her passion worth it?

Like myself, today’s twentysomethings were raised to find our dreams and follow them. But it’s a different world. And as the jobless generation grows up, we realize the grand betrayal of the false idols of passion. This philosophy no longer works for us, or at most, feels incomplete. So what do we do? I propose a different frame of reference: Forget about finding your passion. Instead, focus on finding big problems.

Putting problems at the center of our decision-making changes everything. It’s not about the self anymore. It’s about what you can do and how you can be a valuable contributor. People working on the biggest problems are compensated in the biggest ways. I don’t mean this in a strict financial sense, but in a deeply human sense. For one, it shifts your attention from you to others and the wider world. You stop dwelling. You become less self-absorbed. Ironically, we become happier if we worry less about what makes us happy.

The good thing is that there are a lot of big problems to go by: climate change, sustainability, poverty, education, health care, technology, and urbanization in emerging markets. What big problem serves as your compass? If you’re a young leader and you haven’t articulated this yet, here are some things you can do.

Develop situational awareness. There’s too much focus on knowing the self. Balance this with knowing the world. Stay in touch. Be sensitive to the problems faced by the unfortunate and marginalized. Get out of the office and volunteer. If you’re in school, get out of the classroom. It’s been a long time coming, but business schools are finally instituting changes that put the real world at the center of their programs.

Look into problems that affect you in a very personal way. We’re more likely to be motivated by problems we can relate to on a personal level. In Passion & Purpose, Umaimah Mendhro recounts her story fleeing a war-torn Pakistan with her family and how the experience of dodging bullets to escape helped her summon the wherewithal to found thedreamfly.org, an initiative that helps create connections across communities in conflict.

Connect with people working on big problems. In a world where problems are by their very nature interdisciplinary, just getting to know people who are passionate about one problem leads to discussions on how other problems can be solved. When Jaime Augusto Zobel de Ayala helped reinvent Manila Water to better provide for the Philippines’ capital, he had to deal not only with the typical issues a public utility had to face, but also with problems related to climate change, technology, and community development.

Take time off and travel. Forget about traveling as a tourist. Instead, structure a trip that takes you off the beaten path. Go to an unconventional place. Backpack and get lost. The broader and richer experience pays dividends down the line. Steve Jobs described his time living in India as one of the most enriching and mind-opening phases of his life, and this undoubtedly helped him develop the intuition to solve the big problem of making lives simpler through technology.

We don’t find happiness by looking within. We go outside and immerse in the world. We are called to a higher purpose by the inescapable circumstances that are laid out on our path. It’s our daily struggles that define us and bring out the best in us, and this lays down the foundation to continuously find fulfillment in what we do even when times get tough.

Happiness comes from the intersection of what you love, what you’re good at, and what the world needs. We’ve been told time and again to keep finding the first. Our schools helped developed the second. It’s time we put more thought on the third.

Key Takeaways

Forget about finding your passion. Instead, focus on finding big problems. Tweet

Happiness comes from the intersection of what you love, what you’re good at, and what the world needs. Tweet.

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