Entrepreneurial Mindset: Create Value For Others

Written by Sean Murphy. Posted in Community of Practice, Thought Leadership

Creating value for others is the core of the entrepreneurial mindset. It enables the exchange of value that fuels entrepreneurs efforts to bring new ideas and products to market.

Dan Sullivan: Entrepreneurs Make Two Decisions

Dan Sullivan wrote “The Great Crossover” in 1994. He offers the following insight on entrepreneurial mindset:

Successful entrepreneurs differ from other people–not in their abilities but in their mindset. They have internalized two fundamental commitments, by making these two decisions:

  • Decision 1: To depend entirely on their own abilities for their financial security, because they realize that the only security is the security they create themselves.
  • Decision 2: To expect opportunity only by creating value for others, because they understand that this is the only unlimited source of economic opportunity.

Planting Trees: Finite and Infinite Entrepreneurship

Written by Sean Murphy. Posted in Community of Practice, skmurphy

“A young farmer was urged to set out some apple-trees. – No, said he, they are too long growing, and I don’t want to plant for other people.  The young farmer’s father was spoken to about it, but he, with better reason, alleged that apple-trees were slow and life was fleeting.  At last some one mentioned it to the old grandfather of the young farmer.  He had nothing else to do, – so he stuck in some trees.  He lived long enough to drink barrels of cider made from the apples that grew on those trees.”
Oliver Wendell Holmes, Sr. from “The Autocrat of the Breakfast Table

“And if you ask a farmer, however old, for whom he is planting, he will unhesitatingly reply, “For the immortal gods, who have willed not only that I should receive these blessings from my ancestors, but also that I should hand them on to posterity.”
Cicero “Cato the Elder on Old Age

There are at least two kinds of games. One could be called finite, the other infinite. A finite game is played for the purpose of winning, an infinite game for the purpose of continuing the play.
James Carse in “Finite and Infinite Games

Some people are attracted to entrepreneurship out of the desire to make enough money to live the life that they really want to lead, in effect to retire early and enjoy life. For the most part entrepreneurs are driven by a desire for accomplishment and autonomy, money is a necessary resource for building a company and paying for what you need in life.

“Surprise in infinite play is the triumph of the future over the past.

Since infinite players do not regard the past as determining the present/future, they have no way of knowing
what has begun in the past.

With each surprise, the past reveals a new beginning.

Inasmuch as the present/future is always surprising, the past is always changing.”
James Carse in “Finite and Infinite Games

The more we do the more we learn about our past. Rearing children taught me much about my childhood, becoming a father taught me a lot about my father, and now that I am a grandfather I have a deeper appreciation for what my grandparents went through. My hope is to be a better father, and grandfather, and steward in the communities that I am a member of.

“It is the desire of all finite players to be Master Players, to be so perfectly skilled in their play that
nothing can surprise them, so perfectly trained that every move in the game is foreseen at the beginning. A true Master Player plays as though the game is already in the past, according to a script whose every detail is known prior to the play itself.”
James Carse in “Finite and Infinite Games

Some entrepreneurs are hoping to avoid surprise and the nee for improvisation. They want to buy a “treasure map” that they can use to build a business just like another famous success. There are franchise models that work, but all require had work and improvisation to counter the local variations the franchise template cannot account for.

“To be prepared against surprise is to be trained. To be prepared for surprise is to be educated. Education discovers an increasing richness in the past, because it sees what is unfinished there. Training regards the past as finished and the future as to be finished.
Education leads to a continuing self-discovery; training leads toward a final self-definition.
Training repeats a completed past in the future. Education continues an unfinished past into the future.”
James Carse in “Finite and Infinite Games

Whether you want it to or not, life in a startup will give you an education if you will let it.

“Explanations establish islands, even continents, of order and predictability. But these regions were first charted by adventurers whose lives are narratives of exploration and risk. When the less adventuresome settlers arrive later to work out the details and domesticate these spaces, they lose the sense that all this certainty does not erase the myth, but floats in it.”
James Carse in “Finite and Infinite Games

It can be comforting to work for a larger firm, but whether you realize it or not it has much in common with a startup.  Few markets are predictable even in the medium term (e.g. 5 years) and the need for ongoing exploration and discovery at somewhere between  a tenth and a third of your efforts is a constant even in good times. In turbulent times it may be more like half of your effort.

The things that persist–if they are renewed–are friendships and fellowship, communities of stakeholders and communities of practice. What tress are you planting today that will bear fruit in five or shade in  ten  years? To whom much is given much is required: what you are doing to pay back the sacrifices and investments that have made your entrepreneurial efforts possible?

Start With a List of Customers and Problems That Build on Your Experience and Relationships

Written by Sean Murphy. Posted in 1 Idea Stage, Community of Practice

“Start building network, blog, educating 1 year before you make the leap.
Build community.
The first sales will always be to friends. Make those friends.”
Conor Neill in “Entrepreneur: Start a year before you Start

I think Conor Neill offers this is a great framing for the need to identify the things about your plan that are not likely to change–a problem area, a category of customer–and join communities that are already focused on these. Build on experience and relationships.

He advises “build community” and not “build new community” and I agree, I would build new only where you cannot find existing communities.  If it’s a real customer category or a real problem there is almost always one or more communities formed that are addressing it at least partially. There may be several each using different terminology and focused on a different aspect of the same set of problems, but this is a search you can start well advance in crafting a product.

I don’t know if your first sales come from “friends” but certainly from people that trust you, if you can start the trust building process in advance of the sales process by becoming a member in good standing of communities they are already a member of or by writing or speaking about topics that they are interested in, then you effectively start in advance of the direct sales process.

Build on Experience

Another way to look at this is to “always start in phase two of a five phase plan.” Look into your past experiences and projects for examples of problems solved and relationships that you can build on as you start your new venture. If you are going in to a new area and cannot identify aspects of prior experience or expertise that will have an impact then be careful: you may be attracted to the new new thing without a way to differentiate your offering.

It’s OK to start over from scratch but if you are effectively setting fire to ten or twenty years of experience you may want to look instead at problems and fields that are adjacent or can take advantage of your experience in preference to one where you don’t bring relevant experience. Green fields are seductive because you know the problems of the areas you are more familiar with and can fall victim to the “grass is greener” when speculating about how easy a new field may be.

“An early start beats fast running.”
Michael Bowen (@mdcbowen) “Cobb’s Rules

Related Posts

Reflections on Startup Conference 2014 in Redwood City

Written by Theresa Shafer. Posted in Community of Practice, Events, Rules of Thumb

“Not everyone who is worth knowing is famous.
Not everyone who is famous is worth knowing.
You meet your community of practice,
those who can help you see the adjacent possible,
in line waiting for the famous.”
Sean Murphy (inspired by Elia Freedman’s “Accidental Meetings“)

The conversations I had with individual entrepreneurs were the best part people of the Startup Conference 2014. 2,000 entrepreneurs, VCs, and met in Redwood City on, May 14, 2014. I talked to a number of folks and had several conversations that were far better than any of the presentations I sat through.

I came away with a couple of thoughts on networking.

  • Focus first on understanding the other person’s situation and what they are trying to accomplish. This enables you to share useful and directly relevant information and to ask for insight and assistance that they are more likely to be able to offer.
  • Trust develops over time: smiling helps, listening closely can require effort in a crowd but by giving someone your clear attention you encourage them to have a serious conversation.
  • Make a note to jog your memory of the conversation. I often use either a their business card or a 3×5 card, use your smartphone or tablet if that’s easier.
  • You can only make connections if you first listen carefully and understand their story.
  • If you meet someone at an event don’t skip talking to them if you have the opportunity. Serendipity is always at work but is only possible if you make the effort to have a conversation. It’s hard to predict where things will lead.
  • If you intend to talk to a speaker rehearse what you want to say and get to the point in 15-20 seconds. Exchange cards if you want to follow up. Especially if there is a line get to the point and limit yourself to 30-60 seconds. If a minute leaves you with the strong impression that they would like to talk more go back to the end of the line and let others have a chance to talk briefly before engaging in an extended conversation.

“All great work is preparing yourself for the accident to happen.”
Sidney Lumet

Circle the Chairs

Written by Sean Murphy. Posted in Community of Practice, skmurphy

Brian Fuller had an interesting blog post on “Industry events need to get more social.

Panels and speeches at events are the live equivalent of newspaper publishing: We talk, you listen. Newspapers and magazines have been pounded for the better part of a decade that the we-say, you read model isn’t what people want in the age of ubiquitous and constant information. Why should it be the same for live events?

Array the chairs in the room in a great circle around the presenter(s). Everyone has to look at everyone else; no one hides; everyone’s forced to be attentive and stay off their laptops and cell phones. The circular set-up makes conversation easier. Up the ante by removing microphones from the speakers and panelists. Make sure the moderators really know how to facilitate a conversation, even if it means calling on people in the audience. Phil Donahue meets sub-threshold leakage.

These are great suggestions but they have a few things working against them. And I say this as someone who really likes the round table  format and has used it many times:

  • We did the EDA Bloggers Birds of a Feather this way at DAC 2008 and ICCAD 2008.
  • We structured the “Managing Project Health” Birds of a Feather at DAC 2009 as lightning talks followed by discussion in the audience.
  • We run the Bootstrappers Breakfasts®  this way as well.
  • All of our workshops

I only mention this to show I like the format and understand its strengths.

The drawbacks:

  1. Only works with small groups: the nature of the interactions start to breakdown at 16-20 people and really starts to have problems above 40 or 50 people. There are other formats that build on it that have the group break into smaller discussions and then reform and report but the practical limit on the meeting size is somewhere around 40 or 50 for a single large roundtable. Above 16-20 it becomes more difficult to manage.
  2. Speakers sell audiences on attending. While the ‘unconference’ format is also gaining in popularity, I haven’t seen any in the electronics or EDA space. The EDA Process workshop comes closest to free discussion, but again it’s a smaller audience and people are in one room for the day and get to know one another better.
  3. Requires strong moderation. When a panel breaks down into a series of monologues you may still learn something. But when a roundtable doesn’t come off it can be very painful. It’s a challenge to bring folks together for 60-90 minutes and foster a good discussion. We do it at the breakfasts but we limit the table size to 20 (and most breakfasts have 8-16 attendees). Sharing a meal or a cup of coffee also seems to help break the ice. We have the networking take place afterward, once folks have had a chance to get to know one another.

I think the roundtable format works better when the attendees are still wrestling with emerging problems where collaboration trumps competitive pressures (e.g. where the “stag hunt” model still holds). This was certainly the case for the blogger BoF’s and the Project Health BoF as well as the Bootstrappers Breakfasts. Everyone is more focused on learning than “getting the word out” about their product or service.

And I think that points up another problem with the format for conferences. Sponsors pay and take part to get the word out about their product. They don’t want to be in a setting where competitors and others can attend in what is effectively a peer position. If you are on a panel, up on a raised platform or stage, there is an unconscious presumption that you must be smarter than the audience. If everyone is sitting around in a circle, then everyone’s opinions matter more or less equally.

This was the inspiration behind the Conversation Central model that had 8-16 around a table having a conversation. The premise was that we would talk about issues facing the EDA industry that had not yet settled into competing solutions from vendors.

Here are some comments that Jeff Jarvis gave at TEDxNYed that mirror yours:

This is bullshit.

Why should you be sitting there listening to me? To paraphrase Dan Gillmor, you know more than I do. Will Richardson should be up here instead of me. And to paraphrase Jay Rosen, you should be the people formerly known as the audience.

But right now, you’re the audience and I’m lecturing.

That’s bullshit.

What does this remind of us of? The classroom, of course, and the entire structure of an educational system built for the industrial age, turning out students all the same, convincing them that there is one right answer–and that answer springs from the lecturn. If they veer from it they’re wrong; they fail.

Recap From Nov-20-2103 MVP Clinic

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, 3 Early Customer Stage, Audio, Community of Practice, skmurphy

Overview: exploring how to identify some key problems in communities where the presenters members, trying to understand how to research them, and how to contribute to solving those problems.  Two very different people facing analogous situations: one is a researcher looking for action research topics in the KM4Dev community, the other is an entrepreneur who wants to make athletic contests more engaging for contestants and the audience by providing more information that is mobile device friendly.


(You can also download from http://traffic.libsyn.com/skmurphy/MVPClinic131120.mp3)

Next two MVP Clinics


Commonalities between the two cases that were presented on November 20, 2013

  • Challenges in understanding the embedded (often invisible) interests, incentives and assumptions of different groups
  • Assumptions about boundaries of organizations that interact with those communities
  • Change management perspective is necessary but is challenging to apply in a community context — it is more of an organizational term, based on a high degree of control
  • watching a school of fish trying to determine how they decide to change direction
  • both were familiar with communities but may not have appreciated impact of incentives

Panelists for today:

Presenter #1: Phillip Grunewald

  • PhD student researching how knowledge exchanges can be best facilitated in the international development sector.
  • Have been working on this for 1.5 years now and have another 1.5 years  left to conduct studies
  • Before starting this PhD, worked in in various organisations  on Marketing, Corporate Communications, Monitoring and Evaluation and  customer relationship management.
  • Hold a bachelor’s degree in corporate communications and a masters degree in international studies.
  • LinkedIn: http://uk.linkedin.com/pub/philipp-grunewald/6a/4ba/82/
  • Blog: www.thoughtfordevelopment.com / twitter: @thought4dev

Situation: 

  • Attempting to find a mutually beneficial way of facilitating researcher-practitioner interaction.
  • Usually a (social) researcher  (from an external institution) is perceived as an “outsider” that sees  his collaborators as either “means to an end” or as the objects of the  study.
  • This is due to a generally perceived separation between  researchers and practitioners. In this model the practitioners usually  deliver or are themselves the data for analysis.
  • The findings of  research then either stay within the realm of research or are  distributed back via, for example, reports.
  • This not only makes learning  cycles very long but also means that there are things the researcher  “is blind to” by not being closely embedded in the context that is being  studied (this has its advantages and disadvantages).
  • In  the particular the present situation involves a community of practitioners in a collaborative manner.
    • Have  offered 2 hours a week until next May to spend on research projects of  their choice.
    • An initial survey (http://www.allourideas.org/grunewaldtopics/results ) was used to generate and poll ideas. This generated considerable interest and a surprising list of ideas that  the community is interested in.
    • However, since then discussion on the  most popular topic started and participation rates have been low.
    • Part  of the reason might be the internal dynamics of the community, which are hard to completely understand but there are many other potential issues.

Ideal outcomes:

  • High levels of engagement on both sides
  • Mutual learning about content and process
  • Continuous feedback to the research process so that further research can incorporate (reiterative process)
  • Personal development of researcher
  • Basic research – exploration of impact of academic work
  • Experimenting – developing experience for questions that are motivated by practitioners concerns

 Criteria for acceptance of a project

  • Poll the community for popularity
  • Within the KM4Dev concerns (broad thematic area)

Alternative frames:

  • Researcher has to be in both worlds
  • Researcher has to be intimately involved with the research subjects
  • Framed within the KM4Dev topic

Alternative next steps:  

  • Abandon the whole idea as “too difficult”
  • Make questions more specific/have a clearer thematic focus
  • Have more explicit objectives
  • Make people aware that there is a free resource that they are not using
  • Ask people if they question researcher’s ability/capacity to come up with valuable contributions
  • Ask community members if they have no capacities to dedicate to the process (mainly time)
  • Ask why they do not prioritize this activity vis-a-vis their other activities
  • Drive  topics that have been chosen and only have low levels or participation  constrained to specific points in time (rather than ongoing)

NOTES Not much response after the initial survey.  Lots of ideas and votes in the survey, but the social network site (Ning) has had little or no participation Sean: offering service at no charge, letting them set the agenda. . Howard: trying to get an understand what an ideal research project be?  what kind of research design? Philipp: participatory action research.  looks at matter, gathers data, comes up with findings, brings it back. assess changes.  Then the cycle repeats. John: what does research mean to this community, 2-3 hours a week for 6 months may not match their expectations for a project, consider offering a research-related task (as opposed to undifferentiated “research”) e.g. data cleaning so that you avoid the challenge of not matching expectations or running up against problematic ideas of “research.” Sean Is there a concern about asking for credit in results? There IS a problem on the academic side with a self-assessed view of academics that are irrelevant. Sean: making a comparison with Eugene’s case: trying to make things easier, but not changing behavior. Assessing speed. making things go farther. Philipp: KM4Dev is focused on practice; other communities dominated by academics.  Research might be out of the norm; people are oriented toward peer-to-peer exchanges. Using Barb’s question: why should people change?  is there a clear blockage or missing piece that research can address? Originally this was just a probe: “what would the reaction be?”  So far: any outcome is interesting.  but not prepared to give up. Payoff given the challenge of understanding Philipp’s process. How do open source management of volunteers? Is there a pattern for organizing volunteer labor that could be harnessed / re-purposed for KM4Dev? Challenge of figuring out how to leverage 2-3 hours a week may mean focus don’t invest effort in engaging if payoff is small/problematic Howard: in a nonprofit where GIS data described a watershed that was intact in BC.  Tried to engage community around protecting the watershed.  When leaders from the nonprofit traveled there and met with community representatives, they found potential interest, but more interested in issue of teen suicide — a much more immediate threat than the logging companies coming in.  That was a real learning experience for the non-profit.  Shifted the organizations focus to partnering with them through a focus on their issues. [Added post-call: My quick summary of this nonprofit experience glosses over the fact  that, for the nonprofit, the discovery that community members had  completely different priorities represented / might have represented an  enormous challenge for the organization. The nonprofit had no expertise on the issue of teen suicide, and this issue could easily have been seen as beyond the scope of the organization's mission, which was at the time more environmentally oriented. It was the willingness to listen to community needs and to be flexible in responding that enable the organization to move forward.] What does the community view as a key problem ? Where are KM4Dev’s priorities and how does Phillip’s expertise and experience align for best contribution.  Philipp’s  feeling of pain and surprise means he has learned something. Complexity of the KM4Dev ecosystem that Philipp is working with.  same thing for Eugene.  In both cases, people see the offer through very different lenses.  How open up receptivity to alternative ways of working together? The challenge is getting a group of people to change.


Questions from the audience : First question is what’s research in many organizations where KM4Dev members work research is a restricted activity takes a certain status and has some inherent separation from “work in the field.”  So the first suggestion is: how about offering elements of research but not calling it research?  That could include data gathering and analyzing data, or a literature search or many many other bits or pieces that would be useful but are dis-aggregated. Second suggestion is that: KM4Dev members come from many different organizations and they play different roles in those organizations.  Getting them to agree on one research agenda or on one perspective going forward is an impossible feat.  The community will never “agree.” So what’s behind both suggestions is the idea of dissolving as a strategy: to breaks down research tasks into elements on the one hand and to break down the KM4Dev community into sectors with distinct interests.


Presenter #2: Eugene Chuvyrov

  • Have 14  years of  programming experience, with 3.5 of those being an independent   consultant.
  • Built many web-based and several mobile products – love   technology, not just programming, and I can see myself programming robots or wearable devices just as eagerly as I do mobile dev.
  • Ran a Software Architecture group in Florida and I help organize a  cloud  computing group here in the San Francisco Bay area.
  • http://www.we-compete.com/

Situation: 

  • A  year ago, Eugene and two former colleagues from Florida broke  ground on what I wanted to be a new way to engage the competitors and  fans in amateur athletic competitions.
  • As a bodybuilding competitor of 6  years, it always bothered me that:
    •  the process of registering for  competitions was archaic,
    • there was no way to see who was competing beforehand, and that sometimes competition results would not be posted for weeks.
    • I also thought that the competitions were boring for the  audience, since many were not familiar with competition rules or competitors.
  • I wanted to start with the sports I am very familiar with  (strength events) and expand into other sports from there.
  • I showed a  simple prototype of my mobile app to one of the more prominent  competition organizers and he stated they’d use it. (Face palm) that was  all the validation I needed to get going on executing the idea.
  • It took us 6 months to build a website and a mobile app, and I have been promoting it for another 6 months now.
    • I promoted http://we-compete.com  via contacting competition organizers who I knew directly, or via  friends who are also competitors.
    • I also contacted many competition  organizers whom I didn’t know, after noticing that
      • they still had either  .pdf files to download for competitor registrations,
      • or they tried to  integrate EventBrite/other ticketing software into their offering with an iform
    • I established contact with heads of federations that have 50-100  competitions each year and solicited their feedback.
    • I also invested in  Facebook and Google ads, but those generated close to 100% bounce rate.
  • We had half a dozen competitions created on the  platform. Since we waived all fees for the initial batch of users, I  cannot reliably say people would use us  if we had charged them our 2.5%  fee per registration/ticket sold.
  • I expected our offering to go viral  after the initial batch, but that did not happen.

Next Steps:

  • Currently, I resorted to more traditional  marketing.
  • I am organizing a competition myself in June in the East Bay  area, and will use http://www.we-compete.com  exclusively.
  • I am helping a few competition organizers pro bono with  basic web/technology stuff. I sponsored bodybuilding federations,
  • I am  getting more active on social media and doing promotions in e-mail  newsletters/magazines.
  • I am also weighing executing on a consumer play  related to We Compete via creating mobile apps for competitors, and  having those mobile apps feed data into the centralized database (if  competitors choose to share the info, of course).
  • I am also evaluating  partnership with competition content creators (video, photo, general  information) and seeking ways to get on podcasts and YouTube channels.
  • I  am very passionate about this space and would love to continue  executing on my ambitious vision, but not if I have to live under the  bridge while doing that.

NOTES Sean: does the app enrich the experience for an audience.  (business model would have to follow) Eugene: lots of pictures as a form of engagement, no centralized location.  Notice LOTS of mobile devices at any event. The idea is to function like a meetup. Competition is emotional experience… Eugene is connected in the competition space…  direct approach response has been good.  But so far people won’t pay. Business model is like http://eventbright.com

  •     the price/payment is before
  •     the benefit comes afterward

Consider attending a high school re-union to compare behaviors, rituals, and business models for somewhat different kinds of events. The app is really changing some of the dynamics of competition – knowns and unknowns for participants – what is the value of changing that, how to position it going forward and eat own dogfood in organizing a competition – that might be a business How to characterize users / clients

  • heads of established federations and contests – they may not be in much pain (yet?)
  • people considering a new contest for fun or profit – organize a competition “in a box’ similar to how Meetup lowers cost of coordination
  • Notice the monopoly structure of the business… populated by people that are not very tech-oriented

What is the mobile app about:

  • pictures?
  • stats?

Typical event:

  • 90 competitors
  • 500 fans/participants

Barb: I’m also thinking that this needs some change management theories applied to it… I think that Eugene is right in showing the benefit  Why should people change the way they do things, when they work so well so far? Sean: more like meetup than eventbright. Can you provide unique or more curated content?  or just additional content? …so that profiles persist across competitions… Could competitors be encouraged to pay for the profile? What’s the value of a profile to other competitors? Can other sites be integrated?  Do those other sites support the mobile side?  And what are their business models?  and do people look at those other sites during a competition? status quo; organizing iframing eventbrite. in some ways we-compete is a threat, in others a collaborator: complex ecosystem of organizers, athletes, audience Howard: “Create a competition in a box” may be inadvertently taking position of disrupter, so a threat. What you are hearing is that you should continue to explore, more by making offers than writing code


Questions from the audience: ? unique content vs. basic mobile app with pictures ? transition from “probably not a good idea” to “late” Philipp: What about assessing information needs ground up?

MVP: What’s Really Under Your Control

Written by Theresa Shafer. Posted in 3 Early Customer Stage, Community of Practice, Customer Development, Lean Startup, Workshop

An MVP is an offering for sale

We use this definition in our “Engineering Your Sales” and “Validating Your MVP” workshops and our MVP clinics. Our focus is on developing and selling products to businesses so that biases the definition a little bit but it’s important to remember what’s under your control in crafting your MVP:

  1. The particular type of customer: you can select who are you targeting and messaging. In many B2B markets the best message is a dog whistle: highly appealing to your target and of little interest to those who are not.
  2. The specific problem or need your focus on: it’s better to pick a very narrow pain point initially so that you maximize your chances of providing value.
  3. What you provide: the feature set and packaging of your offering.

These are normally the three areas that you tinker with during marketing exploration and MVP introduction. It’s also important to understand what’s not under your control: 

  1. The customer decides if the need is important enough, or the problem severe enough, to devote any time to conversation or learning more about your offering.
  2. The customer decides if your solution offers enough of a difference over the status quo and other alternatives available to them to actively consider. Value is in the customer’s mind and it’s created in the customer’s business when they successfully deploy your offering. Your MVP is not valuable in the abstract; it must always be evaluated in the context of a particular customer. It does not matter how much time and expense you have invested in creating it, it’s the effect it will have on the customer’s business.
  3. The customer decides the nature and size of the initial purchase. You can decide not to pursue an opportunity that is “too small” but if the customer wants to pilot in a team or one department before deploying your solution more widely it’s often better to take that deal and get started than continue to argue for a larger initial deal. Breaking your offering into phases and smaller components will always make it easier to digest.

The following chalk talk illustrates this last point in more detail:

See “Chalk Talk on Technology Adoption” for a transcript.

Tribes and Traction

Written by Sean Murphy. Posted in Community of Practice, skmurphy

Question: I’m reading Seth Godin’s Tribes book, what role do you think tribes play for startups? For context, we are in crunch time at my startup. We have a few part-time engineers and have soft-circled first half of angel round. Morale is still very high but have lots on our mind. I’m contemplating whether our energy is better spent “buckling down” and addressing our needs for people and investment, or a whether we should focus on catalyzing a community who share our passion to make tech better for relationships and community.

To answer your fundamental question: tribes are very important but you need to demonstrate enough external traction on a problem worthy of their attention to activate their involvement.

There are  two broad categories for indicators of startup health and progress: internal and external.

  • Internal indicators are things like lines of code written, specifications complete, website launched, morale..anything that does not require action on the part of someone outside the team.
  • External indicators are things like website visits, signups, funds raised, revenue from customers…things that require actions by prospects, customers, investors, partners and other outsiders.

Both categories can include “vanity metrics” that don’t address or substantiate your fundamental business model or value proposition. For example: investment does not substantiate your value proposition or business model.

What will success look like for your startup?

  • If you want to catalyze the creation of new technology products that facilitate networking and relationships that may be more of a social venture than a business venture.
  • If you want your team to be able to work full time on startup tasks you need to generate enough revenue to be able to pay them.
  • If you want to start an open source project that reduces the cost of critical infrastructure for communication and social connection then you would focus more on adoption.

Related blog posts

Changing Management’s View of an Innovation From “Probably Not a Good Idea” to “We’re Late”

Written by Sean Murphy. Posted in 3 Early Customer Stage, Community of Practice, Demos

In May of this year I was invited to take part in a month long group discussion on CPSquare where my consulting practice was the topic. This is the third question I answered, it was a follow up to the second question.

Q: I work in prevention and community change.  We have a lot of established staff who do not see the utility or possibility of most of what social media communications technologies have to offer.  We have new staff who tell me they hate going to work because there are no interesting tools to connect them to their contacts and communities. They are continually frustrated by lack of access to even simple social media tools.  Almost no social media is allowed. No facebook, twitter, youtube, etc. While the state agency has a form to submit to file for an exception, they are rarely granted and if staff attempt to access a site that is not allowed – they get a Big Red Hand on the screen. Every site they visit is tracked … they can be written up if they spend too much time online or visit sites that are not on ‘the list’.  All of this insanity as the world is moving to the cloud!

So, in the end they have no access during work hours to the very customers (community members) they are aiming to engage or serve or collaborate with other than through — you guessed it — email. Sigh.

I dream of the days when we reach “shared experimentation” between provider and community in order to achieve a real learning ecosystem of “shared learning”. Until then they are somewhat bound and gagged. I am curious about the ways you’ve employed to open eyes to the possibilities and to creating that dissonance between what is and what could be with a new tool set and way of thinking?

A:  I share your dream.

I think this situation goes back to task/job definition. If the management team views work as the production of paper or database entries or Microsoft Word documents then alerting them to the power of fostering relationships outside of the organization is going to take some careful preparation and extended engagement.  My first set of hypotheses would be that they are concerned with

  • How can I measure this activity?
  • How can I distinguish between this activity and goofing off?
  • What is a clear deliverable outcome I can expect after a reasonable period of time?
  • What opportunities are we missing by not taking part?
  • What will we give up to give people the time to engage in this activity?

Pretend for a moment you had been tapped to lead a small team or group that would spend one hour a day on social engagement what would you do to foster shared learning and expertise within the group. What promises would you make for deliverables within two week, four weeks, eight weeks, thirteen weeks? Can you point to other groups/organizations that are similar to yours (in function, mission, …) that are doing a better job of fostering shared learning through social media engagement?

Normally in the private sector new ideas exist in one of two states in a senior manager’s mind:

  • probably not a good idea / waste of time and resources
  • late / need to catch up to competition or customer need or request

It’s not a recipe for leadership and normally requires a crisis or near death experience at an organizational level to trigger change, but it’s not uncommon.

I don’t know if this helps but gathering some objective info about other organizations and anticipating likely questions about measurement and outcomes would be two places I would start. Also you can plan for “exponential ramping.” Figure out what you can accomplish and point to on your own, then bring another person, then two…

Real Innovation Requires a Community of Practice Fostering a Cascade of Inventions

Written by Sean Murphy. Posted in Community of Practice

In May of this year I was invited to take part in a month long group discussion on CPSquare where my consulting practice was the topic. This is the first question I answered, it was prompted by my opening statement.

Q: I was particularly struck by how the work you do tends to focus around communication and change.  I’m wondering if there are any emergent patterns in this area that you have uncovered? How do communities of practice facilitate your work (assuming that they do)?

A: Here are a couple of quick lessons learned:

  • Most sustainable changes are nurtured in communities of practice.
  • The idea of a lone inventor is accurate as far as it goes but most real innovation requires a reinforcing cascade of inventions.
  • The distinction between early customer and co-inventors or co-innovators is often artificial.

When we have a new technology we look very hard for communities that are already working with it, or related technologies or are focused on managing or addressing the problem or opportunity we would like to aim the technology at.

“Sharing My Practice” Discussion with CPSquare: Intro

Written by Sean Murphy. Posted in Community of Practice, EDA, Rules of Thumb

In May of this year I was invited to take part in a month long group discussion on CPSquare where my consulting practice was the focus. This is the introductory statement I posted to explain a little bit about my background and what I do.

Intro

I worked in Electronic Design Automation on board, chip, and system design in the 80′s and 90′s. This gave me an appreciation of the value domain specific visual languages for representing geometric, physical, logical, electrical, and temporal properties and relationships. Since I had studiously avoided electronics and anything related to hardware in my education I had to concentrate on the poorly understood problems of data management and applying computers to the design of computers.

I also learned that electronic systems design required a team of experts from different disciplines collaborating to create something new. A chip design team needs to reach a working consensus on a range of problems in different domains. One paradox over the roughly two decades I worked in system design was that solving a problem in one domain moved the constraint to another one, so that you a group that was critical for one or two generations has to let others take the lead as new challenges dominate.

When I was getting ready to apply to colleges I had a long conversation with a friend’s father who worked as a fighter aircraft designer at McDonnell Douglas. He was an expert in materials and mechanical design. He said that one of the challenges his organization faced was that aircraft survivability from the 1940′s through the 60′s had been driven by airframe and engine design as combat took place at close range using machine guns. As Gatling guns gave way to missiles there were many fewer combat engagements within visual range: avionics and electronic counter-measures, which had become important starting in the second half of the World War 2, now came to dominate the equations governing survivability. The challenge was that the organization was dominated by folks with a clear understanding of airframe design and they needed to learn how to incorporate guidance from many new disciplines.

I think this challenge of integrating not only the evolution of  knowledge in a particular domain but fostering effective communication and collaboration among experts in different domains was what led me originally to CPSquare. I was working at Cisco in a hardware design best practices effort and I read an article by Etienne Wenger on cultivating communities of practice in the Harvard Business Review. It was eye opening.

These days I work primarily with teams of two to five engineers or scientists who are experts in a field and are challenged with explaining the benefits of their services or software so that they can get their startup off the ground. I spend some time trying to understand the details of the technology but for the most part try and draw a box around it and understand the inputs, outputs, timeframe, and costs that a prospective customer will need to appreciate before deciding to engage.

The incorporation of a new technology into a business process often changes existing political boundaries, frequently obsoletes old assumptions, establishes new processes and ways of working together, and requires shared experimentation between the customer and startup for shared learning.

I am happy to answer any questions folks may have on challenges I face or issues that I wrestle with. I have learned a lot from my participation in CPSquare events over the years and am happy to take part in this exercise.

For more background on my current practice and some of the things that have influenced me please take a look at some of these blog posts:

Entrepreneurs Need a Community of Practice Not a Movement

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, 4 Finding your Niche, Community of Practice, skmurphy

Patrick Houston observes the following in “Lean Startup Concept No Silver Bullet

[...] I’ve read the book. I’ve recommended some its practices. I’ve embraced some too as my own startup conceives, develops, and consults to technology-fueled media startups. I concur with the precept at the heart of the lean approach: Even the most brilliant and experienced people don’t know enough to outwit emerging, rapidly changing, and increasingly complex markets, especially when it comes to products and business models without precedent.

According to the “lean” way of life, the only prudent way to determine what the market wants is to deploy the scientific method, the very same one we learned in grade school: State an hypothesis and then do an experiment to prove or disprove it.

This inherently more humble approach to business represents a refreshing contrast to the entrepreneurial hubris that struts its stuff down the streets of Palo Alto where people live by the self-assured motto, “Go big or go home.” If only for that reason, I’m attracted to its tenets.

But that doesn’t mean I’m willing to swallow it whole. The main reason: The “lean” philosophy is just that. It’s not just a tactic or strategy. To listen to its champions, it’s an ideology. I started wincing on Page 14 of the book when Ries called the Lean Startup idea “a global movement.” A movement? Really? Like civil rights? Environmentalism? The Arab Spring?

To me, when someone touts a practice as a movement that’s the telltale sign of fad, one that over-promises like so many predecessor methodologies that came and went because we failed to subject them stringently enough to critical thinking.

Eric Ries’ Startup Lessons Learned blog and the two Startup Lessons Learned conferences in 2010 and 2011 sparked a number of useful additions to established pragmatic approaches for new product development and introduction. He has encouraged entrepreneurs to focus on learning and to be curious about their customers’ needs and constraints. This has been is a healthy antidote to much that was written about how to court professional investors as the critical rite of passage for an entrepreneur to master.

But I don’t consider myself a disciple or part of a movement. I consider myself a practitioner. I am a huge fan of Saras Sarasvathy, Clayton Christensen, Peter Drucker, Gary Klein, and Gerald Weinberg. I found Geoffrey Moore’s Crossing the Chasm very useful and felt that the first three chapters of Four Steps to the Epiphany by Steve Blank offered a useful perspective, but was similar in many ways to Mark Leslie’s “Sales Learning Curve” and much of the key discussion in Innovator’s Solution by Christensen.

I continue to take an active part in the discussions on the Lean Startup Circle because I like the commitment to learning that the community has.  I think entrepreneurship represents a way of looking at the world, and in particular what Saras Sarasvathy calls effectual logic. Working from means to ends and then using those ends as new means to new ends.

In Sarasvathy & Venkataraman’s 2011 article  “Entrepreneurship as Method: Open Questions for an Entrepreneurial Future” in  Entrepreneurship Theory and Practice, 35(1), 113-135 they conclude:

Until now, for the most part, we have focused on entrepreneurship as a phenomenon and we have tried to understand how to create the conditions for good entrepreneurial performance whether at the firm level or at the societal level. That is akin to asking “What explains the discovery of penicillin or plate tectonics?” or trying to understand the role of government funding in the nature and magnitude of scientific output. To specify the method of science or of entrepreneurship, however, we have to roll up our sleeves and actually observe experienced entrepreneurs in action, read their diaries, examine their documents and sit in on negotiations—as did the scholarly and humanistic literati of Bacon’s time. And as we extract and codify the “real helps” of entrepreneurial thought and action, we need to figure out ways to embody them in particular techniques and mechanisms that we refine in the laboratory and the classroom with a view to carefully determining the logical relationships both between these mechanisms and how they connect to the unleashing of human potential. In short, we have an exciting time of hard work ahead of us.

I think we are closer to the 1% (or at most the 10%) level of understanding entrepreneurship and that it’s very short sighted to view it as a settled body of knowledge or a set of solved problems we can turn into checklists or video recorded lectures. It’s not algebra.

I certainly offer checklists and videos on this website that I hope you will find helpful but I look at them as my contribution to a community of practice devoted to entrepreneurship.

I find it hard to predict the evolution of lean / customer development. Looking back to 2003 when the first edition of “Four Steps” with the Tokyo subway map came out a lot has changed and yet the fundamental challenges the first few chapters address remain unchanged. “Get out of the building” is a technique for avoiding the prison of your own perceptions as an entrepreneur. The earlyvangelist checklist is still a reliable guide to spotting organizational change agents.

I saw a comment by Bill Seitz on Ash Maurya’s blog post about his new Spark59 Manifesto that gave me pause:

[...] I get uncomfortable with all the leading lights of the Lean movement becoming gold-prospecting-tool-sellers instead of people talking about lean from the content of mining for gold themselves… (Just as Internet Marketers give me the heebie-jeebies with 90% of the big success stories being people in….Internet Marketing.)

I find it hard to predict what books will be the most relevant to entrepreneurs in 2020. I think many of Peter Drucker’s books will still have relevant insights, as well as Christensen’s “Innovator’s Dilemma” and “Innovator’s DNA”, Sarasvathy’s “Effectual Entrepreneurship” and Gerald Weinberg’s “Secrets of Consulting.” But I find it hard to assess the long term impact of lean models for entrepreneurship.


Update July 1: I realized that I didn’t include a background link for Bill Seitz (@BillSeitz). He is a thoughtful individual with an interesting personal wiki at http://webseitz.fluxent.com/wiki.

Steve Blank originally published the first version of “Four Steps to the Epiphany” using Cafe Press in 2003 with a picture of the Tokyo subway map on its cover. The revised version has a 2005 copyright and Michaelangelo’s “The Creation of Adam” on the cover.

Answering Questions About Your Product In An On-Line Forum

Written by Sean Murphy. Posted in Community of Practice, skmurphy

Situation — you have joined an on-line forum or e-mail list where participants discuss issues related to your product or applications or needs that your product is used for. Someone posts a question in an on-line forum along the lines of:

  • What tools are people using to solve problem X or need Y?
  • What are the pros and cons of choosing tool A vs. tool B (where you offer tool A)?
  • What are the strengths and weaknesses of solution B vs. solution C (where you still offer tool A)?

Recognize that you and vendor B and vendor C are all stakeholders in promoting the category: why do people select a commercial solution instead of rolling their own or using free or open source alternatives. In general you want to adopt the tone and perspective of a knowledge user not a cheerleader or advocate. This is a different situation than someone walking up to you at a trade show booth and asking for a sales pitch.

When there is very little context provided by the person asking the question it’s often better to start with some additional objective questions to better understand their particular needs, constraints, workflow or overall situation.

Acknowledge that both tool B and tool C are good solutions unless they are not at all appropriate. Mention other solutions that are also viable.

Point to objective third party write-ups of how to make the decision. Help the poster walk around the issues; don’t just advocate for your offering. Software, whether installed or SaaS, is the promise of an ongoing relationship with a customer, not a one time transaction. You are not selling a wedding dress–something that will normally only be purchased and used once in a lifetime–you are selling a tool that your customer will rely on going forward.  You want to act like a trusted advisor not a used car salesperson.

If you are selling a tool or service that is normally only used once (e.g. how do I migrate my data from X to Y and I am not going back) then focus on the results and how to measure them. Explain your process steps and quality control measures.

Be frank about the weaknesses or shortcomings of your offering that are relevant to the situation described in the question or uncovered in response to your request for more context. Acknowledging shortcomings increases credibility; if a user were writing in they would talk about relevant shortcomings of the solution they were recommending.

Offer one or two reasons why named customers have told you they chose your solution. Tie these back to the objective questions you asked in the beginning.

It’s critical to understand the problem the customer is trying to solve so that you highlight relevant capabilities that your product or alternatives offer for the particular use case. While the sales team at the Jaguar dealership cannot figure out how those poor guys selling Fiats make any money because no one ever walks into their dealership who wants a Fiat, consumer Reports still covers both in their buyer’s guide. Public comments in a forum should be more like a buyer’s guide than a sales pitch.

Summary: your fundamental goal is to be viewed as a valuable contributor to the community.

  • Building credibility is the result of a series of posts that allow you to be viewed as a member in good standing.
  • Good posts normally include one or more of the following
    • Objective questions aimed at a better understanding of situation and context for decision.
    • Objective statements either about your offerings shortcomings or assessments from third parties.
    • Real stories from customers that are relevant to the situation.

Find A Peer Group Who is Interested In What You Have To Say

Written by Sean Murphy. Posted in Community of Practice, skmurphy

Humiliation

“My own view is,” I began, but no one listened.
At the next pause, “I always say,” I remarked, but again the loud talk went on.
Someone told a story. When the laughter had ended, “I often think—”; but looking round the table I could catch no friendly or attentive eye. It was humiliating, but more humiliating the thought that Sophocles and Goethe would have always commanded attention, while the lack of it would not have troubled Spinoza or Abraham Lincoln.

Logan Pearsall SmithTrivia

Entrepreneurship can be a lonely activity. Translating an insight into a successful product in the market requires both the ability to reflect and the ability to adapt and refine your ideas. One advantage that a peer group can offer is a diversity of perspectives, another is to offer the right question when you are stuck to help you see the path again. You have to take the time to refine your ideas and hone their presentation, but a supportive group of peers can often help you continue to refine and improve it.

Book Club July 13 Community of Practice

Written by Theresa Shafer. Posted in Books, Community of Practice, Events

Book Club For Business Impact Call-in Book Discussion recorded on July 13, 2011

Matt Childs, Dave Horner, Francis Adanza,and Sean Murphy review and discuss two Communities of Practice articles. They share example communities that they value and the key insights from the articles. Matt and Sean also share how they look they at running several communities.

View the recorded session

Two Community of Practice Articles

Communities of Practice – a Brief Introduction

by Etienne Wenger

http://www.ewenger.com/theory/index.htm

Cultivating Communities of Practice: A Guide to Managing Knowledge – Seven Principles for Cultivating Communities of Practice

by Etienne Wenger, Richard McDermott, and William M. Snyder

http://hbswk.hbs.edu/archive/2855.html

These articles provide a good introduction to what communities of practice are and why business leaders find them useful as an approach to knowing and learning..

Related Resources:

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  • What do you think of the book?
  • Do you have a question about the current book?
  • How did impact your business?

Additional Book Reviews

Dan Roam's Back of the Napkin
Managing Oneself
You Need To Be A Little Crazy

Federated Entrepreneurship 3: Play Your Own Game

Written by Sean Murphy. Posted in 4 Finding your Niche, Community of Practice

Blake Jennelle, one of the prime movers behind Philly Startup Leaders (PSL), was recently interviewed by Technically Philly as a part of their “Exit Interview” series. The focus of the series is entrepreneurs who have left Philadelphia:

We hear a lot of chatter about Philadelphia’s brain drain, particularly from our technology community. We’ve read the reports and heard the studies, but we wanted to hear from the people who have actually left. Why’d they go, would they stay, will they come back?

Jennelle has just left Philadelphia to move to New York and he offered several reasons for doing so. But I found one paragraph in the interview to be the least useful for entrepreneurs, whether they are in New York, Philadelphia,  or Silicon Valley.

I feel like we’re in our sophomore year as a city [Philadelphia]. By comparison, I think Boston is in its junior year and New York is a senior strutting around campus and getting all the attention (for good reason). Silicon Valley graduated a while ago and is starting to get tired of the working world.

Putting Philadelphia, Boston, New York, and Silicon Valley in a continuum ignores the fact that each will follow it’s own path, leveraging unique local strengths and advantages. Silicon Valley is perhaps 100 years old if you date it’s founding to Federal Radio. Boston, New York, and Philadelphia are easily three times as old, each with their own traditions and accomplishments.

I made this observation on the e-mail list for PSL and it lead to a private e-mail communication with Jim Stogdill that he has given me permission to share:

Stogdill: If each region does the same thing one would expect the relative strengths of each (as measured by number of startups, revenues, etc…) to follow a free scaling distribution.  So, I agree, seeing it is a continuum is a dead end. That battle ended in the 1960′s after the transistor was invented. Another way to look at it though is how each ecosystem has tended to develop different strengths based at least in part on their backgrounds.  NYC has deep roots in publishing for example that tends to inform some of the stuff happening there on the web.  Rather than thinking about competing with Silicon Valley on its own terms I think it makes more sense for Philly to understand its unique strengths and grow on them.

Murphy: That’s my problem with the premise behind the “exit interview” series, it promotes a model that Philadelphia needs to listen to people who are leaving to learn how to be more like some place else. It would be much more useful, following a “amplify positive deviance model” to look at entrepreneurs who are succeeding in Philadelphia and the reasons why.

Stogdill: Yep. Can’t win playing a game someone else already won.  Want to replace Wall Street as banking center?  Nope, can’t.  Gotta do what they ain’t.

Jim Stogdill (@jstogdill) also blogs at Limn This and O’Reilly Radar (jims).  As he notes for both “everything posted on this blog is my personal opinion and does not necessarily, or even probably, represent the views of my employer or clients.”


Notes:

  1. In my original “Federated Entrepreneurship” post I noted that
    1. Many regions  aspire to improve the level of innovation and dynamism in their local economy. But the Silicon Valley model of technology entrepreneurship combined with risk capital is more than 100 years old: it can be traced to the founding of Federal Telegraph in 1909 (it’s noted by California Historical marker 836). Today’s efforts build on prior practices and institutions.
    1. I think this means that each region needs to leverage its unique strengths new industries and local entrepreneurial activities. Put another way, Silicon Valley has already been invented, now we need to invent the regional models that will replace it.
  2. Federated entrepreneurship is a core principle of the Philly Startup Leaders, here are some key points from their manifesto:
    • To survive this journey, startup entrepreneurs need many things. They need access to funding and talent.  They need support from their government and their community.  They need opportunities to educate themselves and their team.
    • But more than anything else, startup entrepreneurs need each other.
    • No one can truly understand the life of an entrepreneur but another entrepreneur—no matter how much time they might spend investing, teaching, consulting, servicing, or legislating in the world of startups.
    • Philly Startup Leaders is a community of startup entrepreneurs dedicated to helping each other on their entrepreneurial journeys.
  3. Federated entrepreneurship is also one of the principles behind the Bootstrappers Breakfast which now operate in Chicago, Minneapolis, San Diego, San Francisco, Silicon Valley (Mountain View, Milpitas, Palo Alto, and Sunnyvale), and Walnut Creek, CA.
  4. Federated Entrepreneurship 2” explores efforts to evangelize better entrepreneurial practices by Eric Ries and Sramana Mitra.

Fourth of July 2010

Written by Sean Murphy. Posted in Community of Practice, skmurphy

Fourth of July is when the Declaration of Independence was signed, America’s declaration to England that “You’re Not The Boss of Me Now.” A sentiment many entrepreneurs can relate to, and according to “The Language Log” first mentioned in writing in 1883:

His sister was going to put her arms around him, but he whirled, and facing her with a very angry face, snapped — “Let me alone; you are not the boss of me now, I tell you, and I’m going to do as I please.”
—”As by Fire,” The Church, New Series Vol. III, 1883, p. 70

But what to make of where we are today.  Peter Goodman notes in “The Great Rupture” (bold added)

In a musty coffee shop in the suburbs of Portland, Ore., a dozen people occupying scruffy couches peer into laptop computers, their screens casting a blue glow across pasty faces. They scroll through online job listings, availing themselves of free Wi-Fi, as they pass another drizzly afternoon in the temporary office of the age.

You run across this scene in town after town these days, from doughnut shops tucked into strip malls in Charlotte to vegan  cafes in Austin. It has become commonplace, along with possessions piled curbside in front of foreclosed homes. [...]

And yet the same scene suggests the endurance of a psychic strength that Americans like to claim for ourselves, at least in the mythologized version of our history: Hard times create a collective response. The worst economic downturn since the Depression, its depth underscored by weak job numbers released Friday, has turned coffee shops into grassroots unemployment offices. People exchange tips on who is hiring and where to post resumes. They watch one another’s belongings. They share limited electrical outlets, rationing resources in the sort of mutually beneficial fashion that typically eludes elected representatives in Washington.

My sense is that we will all have a chance to find out what we are made of in the next year or two (kind of like that Chinese curse “may you live in interesting times”). Entrepreneurial thinking will certainly play a large role in creating new opportunities and new employment.  But so will a commitment to community.

“There is no such thing as a self-made man. You will reach your goals only with the help of others.”
George Shinn

Because we will need all the help we can get.

God Bless America,
Land that I love.
Stand beside her, and guide her
Through the night with a light from above.
From the mountains, to the prairies,
To the oceans, white with foam
God bless America, My home sweet home.

Have a happy Fourth of July.

Federated Entrepreneurship 2

Written by Sean Murphy. Posted in Community of Practice, Events, skmurphy, Startups

Recapping on my earlier “Federated Entrepreneurship” post from January 5.

A federation is a union of partially self-governing units with a constitution that does not allow unilateral changes by a central governing body. I think it’s also a good model for what’s required to create an economically dynamic region. One parallel would be to a barn raising or Finnish talkoot, where a community comes together to solve an urgent problem that is beyond the means of a member or family in the community. As one of my old clients once remarked “it takes a village to raise a startup” and I think it takes a federation of entrepreneurs to improve the economy in a region.

Justin Bacon described this as a goal for his Minnesota Lean Startup Group in a comment on the LinkedIn Group

What we all hope to learn, the encouragement and advice that we give and/or receive, the lessons learned that we share and the relationships that we build, are as much about building this kind of community here locally as it is about helping us foster our own bootstrapped tech-startups.


Two other well known entrepreneurs have shifted their focus to entrepreneurial education.

Sramana Mitra outlined an ambitious New Year’s Resolution for 2010

Through the Entrepreneur Journeys project, I have come to conclude that the most vulnerable phase in an entrepreneur’s life is the pre $1 million revenue stage. This is where numerous ventures fail. Once the $1 million revenue milestone is crossed, entrepreneurs find it easier to find additional customers, manage working capital, and access funding, whether it is credit or equity.

In my roundtables, the vast majority of entrepreneurs I work with are in this rather vulnerable pre $1 million revenue stage.

Thus, I have come to the conclusion that if I could help a million entrepreneurs globally reach $1 million in revenue (and beyond), that would be the foundation of a robust, distributed, and sustainable economic value creation that would add up to a trillion dollars in global GDP. It would also result in creating at least 10 million jobs around the world.

Through my efforts — blog, books, columns, roundtables — I am trying to develop a scalable entrepreneurship education system that entrepreneurs from every corner of the world can access. I am sure, in 2010, this work will gain further momentum.

But I do need your help in getting the word out that this resource base is available for entrepreneurs who wish to access it. Each of you — if you believe in this vision — can directly or indirectly influence, perhaps, another hundred entrepreneurs, and help them clear the all-important $1 million revenue hurdle. By using bootstrapping, crisp positioning, and laser-sharp focus, entrepreneurs can, each in their individual domains, build small businesses with solid foundations.

Eric Ries also outlined a desire to move Towards a New Entrepreneurship in his first post of 2010:

When I started writing about the lean startup, my aspiration was to do more than just share a handful of tips and tricks that work for consumer internet startups. I believe the only way to improve our chances as entrepreneurs is to develop a working theory of entrepreneurship.

Like other industries – from publishing to automobiles – entrepreneurship is in the process of being disrupted by globalization. On the whole, this is a good thing for America and for our civilization. The cost of creating new companies is falling rapidly, and access to markets, distribution, and information is within the reach of anyone with an internet connection. The result is a profound democratization of the digital means of production.

In a subsequent post today Eric did a roundup of Lean Startup Resources; there is also this list of Meetups.

Related posts:

  • “Continuing Education in Entrepreneurship” from October 2006 suggests networking offers “knowledge that isn’t written down” (and not to be found in Mr. Google’s basement):
    “I had this epiphany that I had spent the last dozen years or so, since I started attending Software Entrepreneur Forum (now SDForum) and Churchill Club meetings, in this ad hoc program in continuing entrepreneurial education. Books are valuable, and not enough entrepreneurs do enough reading, but there is also a category of knowledge that hasn’t been written down yet. And you can gain wisdom from listening to someone who has played the game–even if it’s just their mistakes–that you would otherwise have to gain from your mistakes experience.”
  • Breakfast with Tom Anyos of Technology Ventures Corporation” Between 2002 and 2008 TVC offered a set of six monthly classes twice a year in Silicon Valley:
    • Entering the Entrepreneurial World
    • Market Research & the Marketing Plan
    • Financial Management
    • Preparing & Presenting the Business Plan
    • Operations Startup, Monitoring & Human Resources
    • The Term Sheet & Lessons Learned

Federated Entrepreneurship

Written by Sean Murphy. Posted in Community of Practice, skmurphy, Startups

“Federated Entrepreneurship” was a phrase that William Krause used to explain 3Com’s model for management and innovation when he was CEO. Federation comes from a Latin word foedus for covenant or treaty and describes a union of partially self-governing units with a constitution that does not allow unilateral changes by a central governing body. It was a good model for the entrepreneurial business units at 3Com to pursue opportunities both independently and in concerted action.

I think it’s also a good model for what’s required to create an economically dynamic region. One parallel would be to a barn raising or Finnish talkoot, where a community comes together to solve an urgent problem that is beyond the means of a member or family in the community. As one of my old clients once remarked “it takes a village to raise a startup” and I think it takes a federation of entrepreneurs to improve the economy in a region.

Justin Bacon described this as a goal for his Minnesota Lean Startup Group in a comment on the LinkedIn Group

What we all hope to learn, the encouragement and advice that we give and/or receive, the lessons learned that we share and the relationships that we build, are as much about building this kind of community here locally as it is about helping us foster our own bootstrapped tech-startups.

I like the concept of simultaneously bootstrapping a startup and building a community. Many regions around the world aspire to improve the level of innovation and dynamism in their local economy. But the Silicon Valley model of technology entrepreneurship combined with risk capital is more than 100 years old: it can be traced to the founding of Federal Telegraph in 1909 (it’s noted by California Historical marker 836). Today’s efforts build on prior practices and institutions. See “Steve Blank on the ‘Secret History of Silicon Valley’“ for more details and the Silicon Valley Historical Society.

I think this means that each region needs to leverage its unique strengths new industries and local entrepreneurial activities. Put another way, Silicon Valley has already been invented, now we need to invent the regional models that will replace it.

It’s interesting that a number of the engineers behind the semiconductor revolution were from Midwestern Congregationalist Church backgrounds that emphasize a lack of hierarchy and a commitment to education and hard work. Some excerpts from Tom Wolfe’s “Robert Noyce and His Congregation” (a re-write of his earlier “The Tinkerings of Robert Noyce.”):

ROBERT NOYCE, INVENTOR OF THE silicon microchip and co-founder of Intel, grew up in Grinnell, Iowa, one of countless small towns in the Midwest that had been founded in the 19th century as religious communities by so-called Dissenting Protestants: Congregationalists, Presbyterians, Baptists, Methodists, and many others. What Dissenting Protestants dissented from was the Church of England and its elaborate ties to British upper-class life. […]

The Congregational Church had no hierarchy. Each congregation was autonomous. A minister was a teacher rather than a holy shepherd with a flock. Each member of the Congregation was supposed to be his own priest, in direct communication with God. […]

This attitude had a fascinating corollary in education. Back East, as in Europe, engineering was an unfashionable field for any truly gifted student to go into. It was looked upon as nothing more than manual labor elevated to a science.[…]

An extremely bright student, the one possessing the quality known as genius, was infinitely more likely to go into engineering in Iowa, Illinois, Michigan, or Wisconsin than anywhere Back East. As a result, the way to today’s Information Superhighway, more recently known as the Digital Revolution, was paved entirely by geniuses from the Midwest and farther west. […]

A decade later at Intel, Noyce decided to eliminate the notion of levels of management altogether. He and Moore ran the show; that much was clear. But below them there were only the strategic business segments, as they called them. They were comparable to the major departments in an orthodox corporation, but they had far more autonomy. Each was run like a separate corporation. Middle managers at Intel had more responsibility than most vice presidents Back East.

Joel Kotkin’s “Little Startup on the Prairie” has a section on “The Rise of the Brain Belt” (which builds on his earlier “The U. S. Brain Belt“) that outlines some other sources of opportunity:

“The Rise of the Brain Belt”

Perhaps even more important to the revival of the Heartland may be the growth of high-technology services and communications, energy production, manufacturing and warehouses as the critical levers for new employment and wealth creation. Only 10 percent of rural Americans live on farms and only 14 percent of the rural workforce is employed in farming. The area’s future clearly lies in the continued expansion of other industries.

The key to this growth is not merely cheap energy or labor; it’s the quality of the workforce. Although these areas are often seen as lacking in educated workers, many rural regions of the country—from New England to the Great Plains and even parts of the Sierras—actually have a surplus of skilled labor. The basis of this surplus lies in the high level of education among young people in many Heartland states. In virtually every measurement, students in key rural states—particularly the Dakotas, Iowa, Nebraska and Kansas—tend to perform better than those in more urbanized ones, as measured by graduation rates, college attendance and enrollment in high-level science and education programs.

[…] The Internet is rapidly diminishing the traditional near monopoly of information that throughout history has belonged to the metropolis; today a farmer, a securities dealer, a machine shop proprietor or a software writer in a small town enjoys the same access to the latest market and technical information as someone located in midtown Manhattan or Silicon Valley. “

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