The Three Vital Ingredients for Entrepreneurial Success: An Essay
What’s it take to be successful as an entrepreneur? You don’t need some special gift of foresight or super human levels of intelligence to make it, but hey they may help! There are many great entrepreneurs who simply executed business models in a much more effective way than anyone else.
Thirty years of exploring the art of entrepreneurial success has given me deep insights into what it takes. Here is what I’ve found:-
You need three core ingredients to succeed as an entrepreneur: Focus, Accountability and Balance. Each of them alone may get you some of the way, but combining all three is the key to success. The challenge is that doing all three for a sustained period of time can be very difficult.
It’s like running. It may feel relatively easy, depending on your fitness level, to run 100 metres at pace. However, running fast for 10 kilometres or even 100 is a whole other ballgame. And doing so in barefoot running shoes under a scorching summer sun…you get the picture.
But just to illustrate how important it is to achieve this combination for a sustained period of time, here is another example. Meditation and mindfulness are excellent tools for helping you achieve both focus and balance. Meditating for five minutes a day may seem relatively easy. Assume a comfortable stance, focus on your breathing and let your mind clear and viola!; you are meditating. Let’s step it up a level – you’ve been in road warrior mode for days, even weeks; you’re jetlagged, continent hopping like a tourist on speed and your business is placing you under immense stress. Been there? Many times? Yeah it can be tough, right. Finding five minutes for mindfulness would feel like an eternity and an impossible indulgence to many of us under such circumstances. But these are the times when you need it most.
OK, enough picture setting, let’s get back to those core ingredients. That’s what we’re here for after all.
I call the combination of these three elements the triple-helix of entrepreneurial success. Time and again, I’ve found that those entrepreneurs who optimise themselves in these three areas not only achieve the unachievable, but do so repeatedly.
In this essay, I’ll explore the triple-helix and in doing so I’ve called on a number of key protagonists in the entrepreneurial ecosystem, from serial entrepreneurs to venture capitalists, and this paper reflects many of the conversations I’ve had.
As I explore the Focus, Accountability and Balance give yourself a mark out of ten for each of them.
Focus requires a laser-like vision and being absolutely committed to achieving your goals.
For serial entrepreneur, John Wolpert the thing that has helped him achieve better focus is the aspect of Vipassana meditation (just one part of it) that says,”observe and don’t react”. The more he reminds himself to stop and do this one thing, the more focus he achieves. He notes that this is also valuable for accountability and balance, but for him this is the key to the triple-helix.
John is demonstrating a higher level order of mindfulness in his observation; being meta as I like to call it. Think on this situation; you’re cruising the 280 on your way to visit Draper University in San Mateo from your home in Woodside and some crazy cuts you off. What’s your immediate response – flip them the bird, get on the horn… or pull back, and focus on the presentation you’re about to give.
Rich Page is a veteran serial entrepreneur in the Silicon Valley tech space. At Fairchild Semiconductor he developed test programs for Fairchild’s microprocessors, memory products and custom chips. He was one of the first four Apple Fellows, awarded for his work in graphics software development tools. He prototyped Apple’s first portable, color and 68020 Macintosh computers. In the 1980s he joined Steve Jobs at NeXT where he led development of the Cube, NeXTstation and Turbo NeXTstation products. He was President and Founder at Sierra Research and Technologies and also of Next Sierra, a fabless semiconductor company.
He looks at the question of focus through the lens of a startup and asks, “As an entrepreneur / startup company, how many projects should one take on? Generally there are a class of opportunities and several possible projects within that class. If there is a single clear project then the choice is easy. Otherwise do you pursue just one, or two?
After Apple and NeXT, I founded two startups. They were both funded by myself and friends (no VCs). They were both successful. In both cases we executed two projects. And both cases we had a 50% hit rate.
For example, in my first startup we executed two projects (1) 622Mbps ATM and (2) 10/100M Ethernet. Previously we were the first system company to integrate 10M Ethernet into a system. Sun Micro followed us two years later.
When I founded SRTI there was a war between ATM and Ethernet. And during 1993/1994 it seemed ATM was winning the war. Most companies pursued 155Mbps ATM. We pursued 622Mbps ATM which was technically successful but didn’t generate enough revenue. In parallel to the ATM effort, we had about 1/3 of our staff working on 10/100M Ethernet. So we immediately ramped up our efforts in 10/100M Ethernet. This was very successful. I guess if our crystal ball was more clear we could have skipped ATM and just executed 10/100M Ethernet.”
The point for Rich is that many startups do only one thing. VCs are diversified somewhat, but their companies aren’t. In both his companies, Rich did two similar projects, in slightly different markets, and for him this proved to be the right thing to do.
Let’s recap. We’ve heard two fantastic insights from two incredible serial entrepreneurs. Focus requires meta mindfulness and can also be approached in a bifurcated manner. But you are asking – how can I achieve focus?
Let’s dive into that question. There are, for me, four steps to achieving optimal focus.
SODA AND AGILE PERFORMANCE
One of my key mechanisms for achieving optimal focus is to use the SODA approach. It’s a slightly modernised take on John Boyd’s militaristic OODA strategy, which I’ve applied to the field of agile performance.
It favors agility over raw power in dealing with human-centric situations. Agile Performance is a core method for achieving a high level of dynamic focus and staying ahead of the curve.
At its most basic level, SODA is built on the premise that all decision-making takes place in a series of recurring loops of See, Orient, Decide & Act.
Dave McClure, Founding Partner of 500 Hats, a Silicon Valley early stage investor that provides companies with up to $250k in funding and runs a startup accelerator program, explains how he uses SODA and Agile Performance in his investment thesis – “by making lots of little bets, my feedback loop on learning is tighter and faster than most, and we can course-correct.”
Traditionally decision-making in the world of venture capital is relatively slow. It can take months for a VC to conduct adequate due diligence before making an investment. A partner at a VC firm usually makes a handful of investments a year. Against this backdrop Dave has outmaneuvered his competitors by operating at a faster, more agile pace.
The key to Agile Performance is to have superior compute power and the ability to process these SODA loops more rapidly and efficiently (be aware that they do draw on your energy) than the people you are dealing with.
Given that they are also operating within some similar form of thought process, you can achieve major advantage by processing SODA loops more rapidly than them. This will allow you to get into a SODA flow and be able to anticipate their decision cycles.
In essence your decisions are going to be driven by what you SEE within an evolving situation filtered through your own logic gates to ORIENT you uniquely to anyone else. Your logic gates consist of your culture, personal genetics, prior experiences and mindset. Against this backdrop I’m sure you can see why it’s imperative that you maintain a positive outlook. Any negativity in your thinking is going to radically impact on your ability to orient successfully.
The point being that two people with equal compute power may in fact SEE the exact same things, but they are likely to ORIENT themselves differently based on their personal suite of logic gates.
If you are able to maximise your flow and be inside the mindset of those you are interacting with, you can throw out readable patterns that either increase or obstruct their ability to SEE, or read, you properly.
For example, if you are wanting someone to do a deal with you, you want them to read into your observable data that the deal is to mutual benefit. If you are up against an adversary you may prefer to throw out false readings that confuse them and cause them to not only act sluggishly, but also to make decisions that are in your favor. Obscure or exacerbate your intentions to make them predictable or unpredictable, while you also seek to clarify their intentions.
A combination of dynamic behavior, rapid response, a deeper harmony in action and taking initiative are the optimal personal traits that empower you to adapt to and shape outcomes within the rapidly changing macro environment we define as life. Same thing goes for business. Although in business you are dealing with other people on a higher order level. In many respects business has an adversarial quality, the conflicts can come quicker and from multiple angles and your survival is predicated on your ability to achieve a continued series of conquests.
Sun Tzu’s “Art of War” strategy plays into how you utilise SODA in business.
As part of your gaining data and SEEing your opposition you should probe them to reveal their strengths and weaknesses. Looks for patterns in their behaviors and intentions. As a picture emerges consider shaping their perceptions by anticipating their actions and manipulating them.
Don’t attack them directly unless absolutely necessary. Instead aim to disrupt their plans and disrupt their partnerships. Shatter their power base without engaging with them directly. And when you do attack do so at pace in ways they don’t anticipate.
As you get expert at using SODA you can allow chaos to become a part of your modus operandi. This heightened unpredictability will keep people guessing and ensure you remain ahead of their decision making capabilities.
Be dynamic, shifting your tactics, your body language, the cadence of your response and the number of positives and false positives you exude.
PERSONAL SCRUMS AND TIME BOMBS
Some final points on this whistle stop Agile Performance tour.
How do you get better at using SODA; practice and mental focus. Start with some daily SODA mindfulness exercises — a few minutes a day is all it takes initially. Firstly practice SODA in repeatable situations where you can measure what happens if you tweak various factors. Secondly, keep a daily journal of these situations and revisit your journal on a weekly basis. If you are familiar with Agile methodology, think of these exercises as your Personal Scrum.
Time bombs are another extremely effective activity that can heighten your ability to use SODA and achieve Agile Performance-heightened focus. A time bomb is an intensive burst of energy laser-focused on a specific activity. Visualise the energy generated in a bomb blast. It is initiated from within an intense kernel of catalytic behavior and radiates outwards with massive force. Now take that visualisation and apply it to an activity in your daily life. Start with something that usually takes you 10 ? 15 minutes. Time bomb it! The more you practice this the more effective it you’ll become. Journal the results. Notice how much more effective you become at achieving such tasks. Now think bigger – time bomb bigger tasks.
Let’s move on to accountability.
Accountability has a number of facets. How you hold yourself accountable, to whom and to what all play crucial roles.
Clarity of goals and who or what you benchmark yourself against are critical features of successful accountability. Rich Page notes that successful people tend to be more self critical.
“Unfortunately this can lead to feelings like I’m not working hard enough. This can be a problem. They say work smarter not harder, but sometimes it is very difficult. Often things are not so clear.”
Alignment is a key part of accountability. You need to have the right culture within your company and a deeply symbiotic relationship between your co-founders, staff, investors, board and advisors.
The day in, day out 24/7 rigors of building a high growth company are challenging enough. Doing so without having alignment would be tantamount to, and highly likely to lead to, disaster.
Factor in major challenges such as pivoting, capital raising, scaling and taking your company public and even the slightest misalignment is going to cause a major shear and impede you heavily.
To achieve alignment and hold yourself truly accountable you need to do two things:
1.) hire for optimal strength and not for lack of weakness, to paraphrase Colin Powell. Only take on people who are an exact fit for what your company needs at a particular time. Appropriate is insufficient. Top hires hold you accountable.
2.) work with advisors who have built companies and who understand innovation. As an entrepreneur you need advisors who can keep you from totally freaking out. Remember, your entrepreneurial motto is “if it’s not crazy, ambitious and delusional, is it really worth my time?” CEOs need to be both somewhat insane and a whole lot courageous. The right advisors get this and will hold you accountable accordingly.
Third generation venture capitalist and founder of iconic Silicon Valley VC firm Draper Fisher Jurvetson, Tim Draper says, “I don’t particularly like being held accountable, because I think accountability limits people to what they are accountable for.”
Strictly speaking I agree with Tim. If you are going to successfully hold yourself accountable then it needs to be to a set of dynamic accountabilities. There is no better way to do this than to ensure those you hold yourself to totally get this concept. They need to have a deep understanding of what it means to build a high growth business in a high demand environment – the right mix of insanity and courage!
To this end he has set up Draper University of Heroes. Billed as an unconventional boarding school for the brightest young entrepreneurs from around the world, it’s essentially an immersive training ground for innovation. As I see it, Draper U is teaching newly minted entrepreneurs to step well out of their comfort zones. Through a mix of coaching and peer-inspiration (plus a balanced mix of pure perspiration; many Draper U activities take place in the great outdoors) students build accountability into their lives – accountability to a higher standard than they may have been exposed to previously.
Who do you hold yourself accountable to? Are you stretching yourself?
Let’s dive into the third leg of the triple helix – balance.
This feature may seem counterintuitive to FOCUS, but it is all about achieving the right level of balance between competing demands and interests.
Rich Page believes the most difficult part is achieving balance between job and family.
“The first few decades I think I put too many hours into my jobs. I got remarried about 11 years ago. I think my balance over the last decade is much improved. Maybe I’m just getting older.”
He sees patience as being related to balance.
“One of my best friends has commented on my patience. I have always been patient. He has said something like … Rich will continue almost forever. I think there is a point where one must throw in the towel but most people (including / especially VCs) give up too early. Unfortunately projects take time & developing relationships with customers is a lengthy case.”
One of the side effects of not achieving balance can be less than optimal health. Rich picks up on this, “A few entrepreneurs are skinny. I’m not sure but I would think that most entrepreneurs are somewhat overweight. Who has time for exercise?”
Picking up on my roadwarrior example earlier in this essay, here is what it took for one entrepreneur turned VC to realise his life was out of balance. Brad Feld started his first company while a 19 year old student at MIT. He successfully sold the business and became a VC. He writes on his blog that, at one point he
“had absolutely no balance in my life. I was on the road from Monday to Friday, arriving home exhausted at the end of the day Friday. Amy got ‘the dregs’ over the weekend – I’d sleep a lot, spend time in front of my computer getting caught up on all the crap I didn’t get to during the week, and when we went out, I’ always be tired and withdrawn. The burnout cycle continued; every six months I’d completely crash from the effort. I drank too much, I struggled with my weight and I felt physically crappy. I loved my work, but I couldn’t see past it.”
For Brad, it took his second wife threatening to walk out to make him realise he needed to radically turn his life around and infuse balance into the mix.
Tim Draper’s view on balance is that he just tries to help people “get where they are going. It gives me balance. I also try to throw a switch when I get home.”
The good news is that balance can be learned. The brain has a unique quality: neuroplasticity. As Chade-Meng Tan tells us in Search Inside Yourself, a book Google’s aptly titled Jolly Good Fellow has written that’s based on a course he has run for over 1,000 of the search company’s engineers on emotional intelligence and mindfulness, “what we think, do, and pay attention to changes the structure and function of our brains.”
There are some simple steps you can take to put yourself on the path to achieving balance.
Start out by adding meditation into your life. It is such an important tool for achieving balance. In computer terms, it is like clearing your cache and boosting your RAM all at once. You can do it sitting down, standing up or even walking. Personally, I find running to be a great way to meditate; it allows me to be present with my body and become totally focused on the task at hand. I am both mindful of my breathing and of how my body interacts with the ground (wearing barefoot running shoes makes sure of that!). By half way into my run I shift onto more of a meta plane, while I am still focused on my running, breathing and body, my present mind focuses more deeply on thoughts that come into it. I let them in, parse them against my priorities and either spend time on them or gently push them away and move onto the next one.
Try out a few different ways of meditating and find one that works for you.
Eating well is also critical to balance. If you feel crappy, you’re more likely to eat badly and this creates a downward spiral. Eat fresh, be present with your meal and minimise carbs and sugars.
Lastly, create spaces for your various work activities (for me, I make sure I have a really good set of headphones and access to Spotify – depending on my activity I’ll listen to classical music while I work or hype up n the latest music trends) and don’t forget to reward yourself regularly for achieving goals.
Well that brings us to the end of our whistle stop tour of the triple-helix. There is so much more I’d like to cover and many of the topics I’ve introduced, such as Agile Performance and mindfulness, do require deep dives to do them justice, but let’s leave that for another day.
Let’s get back to you.
How did you rate across each of the three elements of the triple-helix? Are you stronger in any one particular area? Conversely, are you weaker in any of them?
Entrepreneurial success is not about luck. It’s very much dependent on being the best you can be across the entire triple helix. It takes a lot of work and a concerted effort to do this. Training for the triple-helix is like marathon training – work at it steadily. But the good news is that even short sprints, done regularly, are going to make a difference.
Written by Rand Leeb-du Toit, November 2012. All rights reserved.