Entrepreneur Myths (2 page)

This book was written for the new generation of entrepreneurs who are creating the next Twitter, Foursquare, Zynga, Wooga, LinkedIn, Chipotle, Taco Diner, Tesla Motors or Facebook.

I immigrated to the United States of America from Yugoslavia at the age of 11. As an immigrant, I realize America is great because it allows entrepreneurship to prosper and grow. Startups are the foundation of any entrepreneurial economy — especially in America. My mission with this book is to help entrepreneurs become better by providing thought-provoking advice, questions and discussions.

I wrote this book in the same words I use when discussing entrepreneurship with my friends over a cappuccino or beer — or preferably a nice glass red wine.  So don’t be shocked to find a fucking curse word or two.

This book is like a software program or app.  The current version is 1.2 and I’ve frozen the specs for anyone to read now.  As I receive feedback from readers, the myths will be updated with comments — utilizing the principles of swarm intelligence.

Entrepreneur
Myth 1
| Entrepreneurs are born

The entrepreneur DNA — is it real? Based on my experience of investing into more than 25 startups, I don’t believe there is an entrepreneurial gene. Environment and state of mind have more to do with becoming an entrepreneur than genetics. If anyone tells you they were born to be an entrepreneur, bitch-slap them a little for me.

When I was younger, people said I was born to be a soccer player. My father was a great athlete and a great player, and I may possess some athletic genes but my success on the soccer field was a result of playing four to five hours every day, 365 days a year — in sizzling heat or snow. My teenage son has tremendous talent for soccer but doesn’t love it enough to play for hours every day. He chose another sport. And he practices three to four hours per day because he realizes you can’t be good at an anything unless you practice every day. To me, entrepreneurship is like a sport.

Education isn’t the solution either. I funded one PhD entrepreneur in the hardware sector who was a very resourceful, creative and frugal entrepreneur, regardless of his education. And I funded another PhD entrepreneur who was a domain expert when it came to his field in the software sector, but he was not much of an entrepreneur.

A few years ago, I gave a speech on entrepreneurship to a group of MBA students at Oxford. The students wanted to know the secret to why Silicon Valley is the epicenter of technology innovation and the reasons for its success. Having lived in Silicon Valley, I realize it’s not about the geographical location. It’s not a specific area you can find on the map. Silicon Valley is a state of mind. When you go there, you feel the spirit of entrepreneurship.

I told the Oxford MBA students how I had funded entrepreneurs across the U.S. and that great entrepreneurs are everywhere. However there were two key things you can learn from Silicon Valley entrepreneurs: (1) They had acquired an “entrepreneur state of mind,” and (2) They saw failure as part of an entrepreneur journey — not an end in itself.

As the Oxford MBA students listened intently, I looked into their eyes and could see most of them where not willing to risk the costs of failure. A lot of people fucking talk about being an entrepreneur, but most don’t want to risk failing. That’s the problem: fear of failure.

Entrepreneurs are not born — it’s a state of mind

Anyone can become an entrepreneur, so don’t let anybody tell you that you can’t do it. It’s bullshit. The key question is whether you’re willing to reframe your mind to become an entrepreneur.

Entrepreneurs come from all walks of life, personalities, cultures, education levels, psychological traits, etc. One key element that makes an entrepreneur an entrepreneur is the ability to unleash their creative mind, and anyone can do it if they are willing to try.

Brain Candy: questions to consider and ponder

(Q1)
What are some entrepreneur myths you learned or experienced?

(Q2)
What entrepreneur advice worked in the past but doesn’t apply today?

(Q3)
Do you think entrepreneurs are born? Do you think it comes down to experience? Is it a combination of both?

(Q4)
Are your parents entrepreneurs? What sector? How long? Did they help you become an entrepreneur?

(Q5)
Did you grow up exposed to entrepreneurship through your family, friends, school or some other means?

(Q6)
Did you become an entrepreneur so you can become the next Bill Gates? Or did you do it because you can’t get a job or you can’t keep a job? Or did you do it out of passion for your idea or venture?

(Q7)
Are you an entrepreneur because you want to be filthy fucking rich? Or because you want to change the world? Or because you have no choice?

Entrepreneur
Myth 2
| Education is critical to be a successful entrepreneur

My father always told me, in his thick Serbian accent, “Son, without education, you’re nothing.”

He drove me abso-fucking-lutely nuts.  The number of times he preached about education as the key to having a prosperous life, he should have written a book about it. Do you need an education to be a successful entrepreneur? According to my father, you need a college degree if you’re going to make a great entrepreneur. Bullshit.

Peter Thiel, cofounder of PayPal and investor in Facebook, believes a college education isn’t necessary. In fact, he started an initiative that pays kids to drop out of school. He funds high school entrepreneurs to start a business, as an alternative to college, because he believes there is currently an education bubble.
¹

Don’t get me wrong. Education is important, but it’s not going to determine whether you make it in your entrepreneurial venture. The level of education, to a certain extent, depends on the sector of your venture. If you’re in biotech, you’d better have a fucking degree. In fact, you better have more than one.  In high tech, being a dropout has its advantages.

Bill Gates: dropout. Steve Jobs: dropout. Larry Ellison: drop out. Jerry Yang: dropout. These people created multi-billion dollar, high-tech companies without having a college degree. You still need or want one?

The journey of starting a venture can be difficult without a degree. I assure you, from a venture capital standpoint, that if your venture has marketplace traction, the venture capitalist (VC) won’t give a fuck whether you have a degree or not.

Mark Zuckerberg started Facebook out of his college dorm room. He dropped out when Facebook took off like a rocket. He managed to raise a substantial amount of money, without a college degree, from top-tier venture capital firms. You think those VCs asked to see his college diploma?

I funded a PhD; I funded an MBA; I funded a college dropout; and I funded a high school dropout. Fuck, the only person I have not funded is a middle school entrepreneur — not yet, anyway. The high school dropout was as good as, or a better entrepreneur than, the PhD entrepreneur. They were focused on different sectors, but their entrepreneurial capabilities were equal. Both entrepreneurs were highly educated when it came to their sector and market applications. However, the high school dropout was more resourceful and actually more creative in solving, not only entrepreneurial problems, but innovating as well.

Newbie entrepreneurs get confused when it comes to education. I turned down entrepreneurs with degrees from MIT and Harvard who pitched me for money. Just because you went to Stanford doesn’t mean shit. A college degree is great, but it doesn’t guarantee you’ll get funded or become a rock-star entrepreneur.

Entrepreneurship is about creativity. All great entrepreneurs are creative, regardless of the sector or education level. Formal education doesn’t place enough emphasis on creativity. Learning to read, write and compute is critical in life — schools are good at teaching these three elements but they forget the creative element and rarely teach entrepreneurship.

Entrepreneurship classes should be mandatory in junior high and high school just like biology or chemistry. Last time I checked, I haven’t used much chemistry in my life — but entrepreneurship, you can use for your entire life.

Although I’m a college dropout, I am self-taught. The hundreds of books I’ve read over the past 20 years is equivalent to at least one MBA. I apply what I learn to practice and reality. Learning for learning’s sake is not enough. 

I listed more than 20 of my favorite books in the appendix. You should read them too. 
Six Thinking Hats
by Edward de Bono is mandatory reading for entrepreneurs of all ages.

Brain Candy: questions to consider and ponder

(Q1)
How important is education to an entrepreneur’s success?

(Q2)
Is a college degree necessary to be a successful entrepreneur?

(Q3)
Is a college degree from Stanford, MIT or Harvard needed to get an edge in funding?

(Q4)
Do you need a business degree to be a great entrepreneur?

(Q5)
Did you drop out of college to become an entrepreneur? How did it work out for you?

(Q6)
Do you regret dropping out? If you do, will you ever go back and get your degree?

(Q7)
If you’re an entrepreneur working 24-7-365, when do you find the fucking time to educate yourself?

(Q8)
What are some of your favorite books on entrepreneurship? If you had to choose just three, what would they be?

Entrepreneur
Myth 3
| You must risk it all to make it

Risking it all in a startup is absolute bullshit. The media loves to make heroes of entrepreneurs who gambled everything to make it
big
. The story is always the same: the entrepreneur is backed against the wall with no money, large debt and some fucked-up situation, and then wrestles their venture from the jaws of defeat to become an overnight sensation.

Risking it all is not the secret to entrepreneur success. Whether a newbie entrepreneur or veteran, the reduction of risk is critical in any venture — which means you need enough money allocated to sustain your venture during its ups and downs. And don’t give me some bullshit — you will have ups and downs whether you fucking like it or not. Be prepared to lasso that tornado. Mortgaging your home, leveraging your credit cards, or using up all your savings for your new venture is a recipe for a disaster. Been there, done that, experienced it when I was much younger — it was painful. When you hear of entrepreneurs who risked it all and made it, usually they had no choice.