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    Where Did We Go Right? How to Be a Successful Entrepreneur

    by CJ Cornell
    July 9, 2010

    Imagine a well-known Pulitzer Prize-winning journalist. Wanting to repeat his success, he scrutinizes all his articles and discovers they contain the letters “E” and “R” 10 times more frequently than any other letters. In his next article, he focuses on increasing the use of these letters, and then plans on teaching his new-found secret during his journalism seminar next fall.

    More than likely, his success as a reporter is due to a combination of talent, hard work, circumstances, personal relationships and some luck. Which means that evangelizing the benefits of proper letter frequency is irrelevant at best and probably harmful to his journalism students.

    Entrepreneurial Mortality

    Successful entrepreneurs make this same mistake. New ventures are born every day and the sad fact is most die young. Yet the causes of startup death are predictable: Lack of cash, lack of funding, arriving too early or too late to market, insufficient experience or talent on the team, or just plain bad luck.

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    In a startup, you may not be able to avoid death, but at least you’ll know what killed you. Triage is easy on a corpse; it’s a lot harder to dissect a healthy Olympic athlete to understand what makes them a champion.

    Entrepreneurs who experience failure usually have lots of time to ponder the question “Where did we go wrong?” in order to learn from and avoid making the same mistakes. It’s much harder for them to figure out “Where did we go right?” so success can be repeated.

    Success As Poison

    Before becoming entrepreneur-in-residence at the Knight Center for Digital Media Entrepreneurship, I spent my career as a serial entrepreneur. I was surrounded by entrepreneurs who had worked on as many successes as failures. Some of these entrepreneurs are very well known and have achieved legendary status, while others are just starting to become the next generation’s Steve Jobs, Bill Gates and Mark Zuckerberg. Failures, fizzles, flameouts and near misses are the norm — and in Silicon Valley they are rites of passages for every entrepreneur.

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    Experience gained from failure is more valuable than an Ivy League M.B.A. and can serve as a passport for long-term success. Misinterpreting prior success factors can doom the entrepreneur, as well as infecting all other ventures they mentor. Yes, early success can be worse than failure — just ask any child star.

    Many entrepreneurs who taste success attribute it to their own intelligence, vision, creativity or business savvy. They ignore the critical influences of timing, circumstances and luck. In many cases I’ve seen people ignore an inheritance, an influential relative or a family name when they take stock of their success. This brush with success poisons future attempts.

    Snake-Oil Success

    Far more dangerous are former entrepreneurs who have one success to their credit and spend the rest of their career imparting (or worse, selling) their secret to wide-eyed aspiring entrepreneurs everywhere. The books and seminars shout, “Be like me! Use more E’s and R’s than your competition and you’ll be successful.”

    Being an entrepreneur is often like driving a half-built race car 200 mph in a thick fog — and not being sure if the steering wheel works. There are lots of voices in the crowd telling you which direction to drive, but who can you trust? Even if one of the voices belongs to an experienced racer, they have not been successful in these exact same circumstances — so their advice could be fatal.

    Success is Simple. It’s Just not Easy

    Mark Zuckerberg’s path to success was different than Steve Jobs’ path. They are different people with different backgrounds and situations, so trying to copy their path and methods is probably futile. A more reliable way is to look at the majority of success stories and find out what they had in common, and apply the lessons to your own situation.

    Great entrepreneurial success often looks like a combination of luck, timing or brilliance — or sometimes sheer genius — but when you dissect it, there are really just two groups of entrepreneurial success factors:

    1. Personal Factors:

    • Hard work and commitment
    • Sufficient intelligence
    • Interpersonal skills/relationships
    • Location and proximity to resources

    2. Circumstantial Factors:

    • Economic and business situation
    • State of technology
    • Social trends
    • Customer wants/needs/behavior
    • Competition

    When looking at these two groups, notice that all the personal factors are within your control, and the circumstantial factors are the same for every other entrepreneur. So what’s the catch? The best entrepreneurs play to their strengths on the personal factors and develop a particular clarity on the circumstances and leverage them to their advantage. Most successful entrepreneurs actually have one key personal factor and one key circumstantial insight that makes all the difference in their success.

    Now we can better understand what appears as luck, timing and brilliance:

    • “Luck” is when any of the personal or circumstantial factors are stronger without any extra effort. Recognize it, embrace it and use it — but don’t count on it.
    • “Timing” is when several circumstances are aligned with the entrepreneur’s interests. Wait for it, recognize it and move fast when it happens.
    • “Brilliance” is when you are aware enough to take advantage of luck and timing.
    • “Genius” is when the entrepreneur overcomes the personal and anticipates the circumstantial.

    Where Did You Go Right?

    As an entrepreneur, what can you do to make these success factors work for you? First, take a look back on any success you’ve had in the past — no matter how minor — and ask, “What did I do right?” Think about which personal factors were your strengths, how you can use them again, and which personal traits need more work.

    Next, take a look at the circumstances surrounding your prior success. Which of them were you able to foresee or even predict? Perhaps you have a special gift or insight in that area. Are you particularly observant as to customer needs, or can you understand technology or spot trends better than most? These are your success factors, and they don’t come out of a bottle sold by someone else.

    All entrepreneurs, and potential entrepreneurs, have the necessary success factors — personal traits and circumstance. The key is being aware of which are your own relevant success factors, and which ones are someone else’s snake oil.

    Tagged: Arizona State business models entrepreneurship knight center for digital media entrepreneurship startups
    • Great post. Quite thought-provoking.

      Having recently had a conversation about what it takes to be an entrepreneur, I’m also convinced that — for many — it’s something you are born with, or learn at a very early age.

      From the proverbial lemon stand, to creating a small enterprise in high school, to starting your own business instead of going to university — often seen as “whacky” and “out there” at the time, these help to develop the core skills necessary for successful entrepreneurship: tenacity, adaptability, and perseverance.

      Most others seem happier having a “real job.” :-)

      Phillip.

    • Thanks for the excellent post. I haven’t studied entrepreneurship, but I’m wondering how other factors come in to play, such as working in collaborative teams versus hierarchies, and whether the drive to succeed is based in a desire for personal fortune, fame or the joy of creation/innovation in and or itself.

    • That’s the subject for an upcoming post: The critical, indispensable value of being surrounded by like-minded, experience entrepreneurs (like in Silicon Valley).
      Aside from being able to observe role models up close and constantly, one always has that reality-check of what kinds of ideas are innovative and viable, or not.

      Personally I’d have to list “proximity and access to other successful entrepreneurs” as the #1 success factor. Luckily, the web now enables us to have virtual communities (like this one), so there are more chances that fledgling entrepreneurs will encounter credible mentors and role models. Stay tuned.

      CJ

      PS – When it comes to innate entrepreneurial talent, I’m not in the “born with” camp but more in the “born where” camp (with a touch of the “born when”). Role models, mentors, encouragement trump inborn talent any day of the week – but timing and luck are powerful catalysts.

    • moddyboy80

      What a brilliant article. Going to pass this along to everyone I know. I believe anyone with the ability to think and reason can become a successful entrepreneur, regardless of where they live or how much schooling they have had. I am a big fan of keeping things simple in all aspects of life, and of course gaining knowledge from mistakes made, as well as successes enjoyed. To me, it’s a constant cycle of decision, action, and examintation.

    • Kimberlee

      I just stumbled upon this site whilst surfing and I’ll definitely be coming back. This article is very good for someone like me who is trying to better understand “how” to ultimately earn my crust by myself and not be beholden to a “boss.”

    • How do you support your claim that entrepreneurs fail more often than not?

      My research points to a lack of data being kept well or dirty data by agencies. Also, some are changing their way of assessing the differences of closings versus bankruptcies, like the Small Business Advocacy Administration (see Headd for his recent 08 and 09 assessments that show failure rates before 10 years is a myth from the 50’s and 60’s repeated and amplified by his own agency and those that picked up their data as an authoritative source.)

      Nick Denton of Gawker Media created/ran websites he folded or sold as a way to move toward a larger goal of having a media company. His strategy is adjust for market and, like Disney, “build it for them.”

    • Dawn Dickson Van Ness

      And please define size of companies you are dealing with, their revenue and their desired profit margin.

      What I’m finding is medium sized media companies and large of 500+ are little more than trading companies — buy low, sell high, and bluff.

    • Dawn – there’s a difference between a business that fails and an entrepreneur that has failed. I was writing about entrepreneurs – not merely companies.
      I agree about the lack of data and the misleading data that is collected by the SBA (note that I don’t consider “small business” synonymous with entrepreneurship).
      Having lived and breathed the Silicon Valley entrepreneurial experience (and NY and Boston) for over 25 years, mentoring hundreds of ventures as well as working with other mentors and advisers – the evidence is so overwhelming I guess it’s like asking a fish to provide data to prove that he’s swimming in water. Entrepreneurs fail, and often fail several times before they discover success – akin to Edison’s discovering 9,999 ways not to build a light bulb. Most often they fail even before the company gets out of the gate enough to be counted by the bean counters.
      Again – the post was about entrepreneurs – not companies, so I hope this clarifies a little.

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