Simplified: Why and How to be an Entrepreneur – by “Nicholas G – YLT2012”

The movie The Social Network chronicled the creation of the social media site we are all familiar with today, Facebook. Although I believe the intended purpose of the movie was to tell the dramatic story behind the creation of the website, including the back-stabbings, lawsuits, and flaws in the founders’ characters, the movie had a much more redeeming and influential effect in the long run: The Social Network sparked an increase in interest in entrepreneurship, with young people especially, as viewers were exposed to the journey that a typical startup venture follows and come to feel that they can start a venture themselves. Furthermore, The Social Network shows viewers just how possible (and easy) it is to be an entrepreneur on the Internet today.  But why would anyone want to be an entrepreneur?

A Poster for The Social Network
The Social Network sparked interest in entrepreneurship among young people especially.

The Perks

What exactly are the perks of becoming an entrepreneur, especially when you have to take on a large amount of risk? Well, for one, being an entrepreneur means that you won’t have to take orders from an annoying boss. You and your friends (if you choose to start something with your friends) will be in charge of all of the business decisions. You will be your own boss, which means you set your own deadlines, decide what your work environment is going to be like, create your own product, find capital to fund your own business, and learn from your everyday experiences. (Sounds almost like college, but as a job). Already sounds enticing, right?

You also have the chance of solving “the money problem” for yourself. By “solving the money problem,” I mean never having to worry about living expenses or retirement ever again…I mean getting rich fast. By completely devoting yourself to your startup for a short span of time, assuming your venture is successful, you can avoid the situation of taking a drab job that doesn’t suit your interests because you want/need to cover your own expenses and save for the future.

Outside of the possibility of big money and the ability to tailor your workspace and work patterns, the true perk of being an entrepreneur is that you get to work on what you are truly passionate about. You get to build a business around your own idea. You are the creator (just like in The Sims or in Minecraft, but in real life!). Just think about how cool this is. Let’s say you’re a “hacker” (aka a computer programmer) and you code this new social media website that millions of people flock to daily. Or, let’s say you love ice cream, and there’s no acceptable ice cream parlor in your area, so you decide to start a new ice cream parlor that makes its own homemade, delicious ice cream and offers a friendly, sitting environment.

Coney's Cones Logo

Coney’s Cones brings a new type of ice cream parlor to Coney Island”

No matter whether your idea is a new invention or just an improvement on an existing product or even just business practices, it all spawns from you.  You get to see your idea grow from a tiny company made up of just a few people, to a company that is profitable and that could very possibly change the way business in the market conducted for years to come. All of the greatest entrepreneurs and inventors agree: the keys to being a successful entrepreneur are enjoying what you are working on and always striving to improve your product/vision. In case you don’t believe me:

“You have to be very diligent…Know in your heart that you are a good person with good goals…Always seek excellence.” -Steve Wozniak [3]

“Good ideas are out there for anyone with the wit and the will to find them.” -Malcolm Gladwell [2]

So as a quick refresh, the perks are:

  1. You are your own boss
  2. You can get rich fast
  3. You can work on what you are passionate about, and
  4. You can even change the way society works

The Drawbacks

There aren’t many drawbacks to being an entrepreneur. The first and main drawback is that there is always the chance of failure. Even if you work tirelessly, and you have an amazing idea, your company always has the potential to fail. Why? Well business depends on the market, and if consumers do not buy your product/service, or if some competitor sneaks from under you and captures your market, then its kaput.

Another drawback to entrepreneurship is that your work becomes your life for matter of time. This is because startups are usually created by a small team, and since there are only a small number of people to do a tremendous amount of work, this leads to extra long hours, and sometimes even a life of “work, work, work.” The unfortunate implications of this are that you might have to put your social life and even relationships with friends and family on hold.

“Instead of working at an ordinary rate for 40 years, you will work like hell for four. And maybe end up with nothing…During this time you’ll do little but work, because when you’re not working, your competitors will be. [Over 3 years] I went to visit my family twice. Otherwise I just worked.”  -Paul Graham [4]

Despite this, I think the benefits outweigh the costs. An intense work routine only lasts for a few years max, and even if you do fail, you still learn a lot from the experience. In fact, in Silicon Valley, failing is a badge of honor since it teaches you how to be more successful the next time around. Furthermore, once you do succeed, you have created something (you have created something) awesome.

How to Innovate

There are many ways to innovate and come up with ideas for potentially successful ventures, but in this section I will briefly discuss a few of the more common ways that some of the best entrepreneurs utilize.

Improving Something

The easiest way to come up with ideas for ventures is to look at the world around you, think of things you use often, and then to think of ways to improve upon them. I’m sure you have those moments when you say,

“I wish this were like this, now that would be great.”

Write down what you think of, these moments provide precisely the types of ideas you want to build off of. With this in mind, it is easy to see that there are countless things that need improvement. Paul Graham claims that by reading the newspaper one can find many ideas. The newspaper itself is something that needs to be enhanced; it is a dying medium! [4]

Improvement ideas don’t even need to be dramatic, profound, or even visible to the common consumer. Steve Wozniak, cofounder of Apple, designed and built the Apple II (the best selling computer at the time that it was on the market), a computer that was, among other things, innovative in its simplistic internal design and in its minimization number of chips. Such simplicity guaranteed that fewer bugs could ever be in the software (and hardware), and also minimized the costs for producing the cutting-edge computer, helping Apple generate profits more easily than its competitors because it had to spend less on producing its computers. Another example of an innovative startup that stemmed from improving an already existing product is Flickr, the online photo-sharing gallery. Although there were already many similar products online, Flickr improved upon them by adding a cleaner user interface, adding tagging of photos, and, most importantly, by moving away from pushing prints and giving more value to just sharing photos online. One last example is the Swiffer, which drastically improved upon the idea of the mop by creating a “mop” that uses disposable sheets, rather than old, smelly, disgusting reusable sponges/rags like older mops. (Of course, there’s also Facebook, which enhanced the social network idea of MySpace by creating a more organized, uniformly designed site with a better user interface.)

Startups Built Off of Improvement

 

Looking for the Obvious

Another way to find an idea for a successful venture is to look for things that are “obvious,” but that we cannot immediately see because we look at them with the wrong perspective. Although this may at times tie in with improving a product, past “obvious” products are usually those that draw the thought:

“Wow, I could have invented that, that’s so obvious!” or “It’s not that special, anyone could have invented that.”

Ideas similar to these are fairly difficult to see without pondering upon something for a while. It is usually something that can be improved upon or that is missing that we overlook everyday. One way to more easily discover these types of “obvious” ideas is to look at something you do not know very much about (or know well), to come understand it in a new way with what you do know well, and then to use your new, different perspective/understanding to examine what needs to be added or changed. An example would be to design special software for small businesses. Another example that I’m sure a lot of us overlook are the twist-ties that are used to keep breads and other foods fresh for longer. One last, brief example discussed in Malcom Gladwell’s article, “In the Air: Who says big ideas are rare?” is a filter that captures cancer cells, which actually circulate through the body thousands of times (a fact that had been overlooked for years until a physicist realized this by doing easy calculations), stopping them from settling in a new place (metastasizing).

Twist Ties
Obvious, right?

Inventing Something New

You can also come up with an idea that is completely revolutionary. This form of innovation usually ties in with both improving something that exists and/or finding something obvious that is missing from society. A few examples are telephones, the Internet, personal computers, cars, etc. These are the most notable inventions, and most come from combining a new perspective, going against the opinion that something is “impossible,” and finding how to drastically improve some part of society.

Finally, entrepreneurs must always keep a few things in mind when considering ideas. For one, ideas should not be so narrow that if the market shifts, the company fails. Two, entrepreneurs should cater to and listen to users, because consumers decide which businesses survive. If you do not listen to them, or understand what they want, then your company will be doomed to fail.

 

In sum, to really stress these points, in order to be and to become a successful entrepreneur, you must be passionate about your goals and visions, you must want to create something, and you must truly understand what consumers want.

 

Extended Reading and Sources:

  1. Walter Isaacson, Steve Jobs
  2. Entrepreneurship Corner: Stanford, Explore
  3. Malcolm Gladwell, In the Air: Who Says Big Ideas Are Rare?
  4. Jessica Livingston, Founders at Work, Interview With Steve Wozniak
  5. Paul Graham, How to Start a Startup

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3 thoughts on “Simplified: Why and How to be an Entrepreneur – by “Nicholas G – YLT2012”

  1. You mention the influence of the Social Network on entrepreneurship in general, but I think the movie also had a significant impact on glamorizing computer science as a major. I call it the “Mark Zuckerberg Effect:” Up until a few years ago, Yale on average had around 20 computer science majors per year; last year it graduated about 40 comp sci majors; and my year (2015) is projected to have approximately 60-80 comp sci majors.

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