Sometimes I get the feeling I want to start my own business and fly freely. And while I know some smart friends who might join me, I still wonder whether I have the instincts and leadership required.
—Umair Malik, Islamabad, Pakistan
Forget, for a moment, your desire to fly free. Forget the “required” levels of instinct and leadership. And while you’re at it, forget your smart friends.
To start a company, you need those things... eventually. But first and foremost, you need a great idea.
That doesn’t mean we want to discourage you or denigrate the entrepreneurial urge. To us, the gutsy individuals who launch ventures are some of society's biggest heroes.
And yes, there are people who dump their day jobs, hunker down in a garage or spare bedroom with a bunch of friends and then, five years later, can be seen ringing the opening bell on Wall Street. But before you start visualizing yourself in that picture and make the leap from stability to start-up, it probably makes sense to separate wishful thinking from the less rosy realities that usually characterize the entrepreneurial experience.
Let's start with a favourite “wish”—you mention it in your letter—that entrepreneurship grants independence. True, you will become your own boss. But for months, even years, that choice will mean less freedom and flexibility for you, not more.
You won’t control your own life; your new business will do that for you. After all, when you only have two customers, you don’t tell them you can’t meet Monday at 5pm. You smile when they show up three hours later. In your heart, you may be flying free, but in the trenches, you’ll still be taking orders—just from a new set of bosses.
Another bit of wishful thinking is something you don’t mention, but is common too—it purports that entrepreneurship bestows financial independence. If only! Unless you’ve built up a pile of savings, no one is more “owned” than the founder of a start-up.
We recently met an entrepreneur whose venture was stalled because she was loath to give more equity to private investors or venture capitalists.
“It’s bad enough to give up control,” she complained, “but if I keep giving away stock, I’ll still be driving my 1994 Honda Civic to my son’s college graduation.”
Given the fact that her son was an infant, she was joking, of course. But the fact is: Start-ups almost always make their founders poor before they make them rich.
Finally, there is that popular notion you refer to: That companies can get born by just a bunch of bright people in the room bursting with energy to “make it happen”. We’d call that partial information. Obviously, passionate, talented people are the key to getting a venture off the ground. And yes, there have been cases of friends banding together to build something amazing from scratch. But those friends usually had an idea to start with.
The real engine of any start-up is a product or service that fills a market need or better yet, creates one.
Several years ago, we attended a celebration honouring the 50 fastest-growing entrepreneurial ventures in the Atlanta area. The room buzzed with excitement as everyone waited to hear who would get the top award. The winner ended up being a three-year-old company that had discovered a better way to de-ice aeroplanes. Undoubtedly, the company had great leadership, but its revenues were growing 55% a year because it had an idea that changed the market.
Look, all around the world, we’ve seen successful entrepreneurs, young and old, literally changing the world for the better. So, we don’t want to dissuade you from going out on your own.
Just know that there is more to being an entrepreneur than meets the imagination. And there’s a lot less without a great idea to start with.
When should a leader pass blame?
—John Reaves, Matthews, North Carolina
In all of organizational behaviour, there is probably nothing worse than a boss who suddenly forgets a direct report or disavows his team when things go wrong. When you manage people, you are in it together and because you are the leader, you own all the outcomes, good and bad.
That being said, there is one exception.
Sometimes, a leader can’t see and touch all his people, especially in large companies. In such cases, they shouldn’t be held personally responsible for the occasional rogue employee. They can, however, be held accountable for having rigorous control systems in place to ferret out such miscreants, and they should never turn away when they sense something off base.
Every boss can’t be a street cop. But he has to make sure someone is walking the beat.