Think small > > > > Think big
Think small: Carterphone's inventor just wanted to plug his little device into AT&T's network.
Think big: MCI founder Bill McGowan wanted to replace AT&T's network.
Small-business founder > > > > Entrepreneur: "It's totally inappropriate to equate small-business founders and entrepreneurs," says Bill Wetzel, of the University of New Hampshire. "One's looking for an income. The other has the intention of building a significant company that can create wealth for the entrepreneur and investors."
Seat-of-the-pants > > > > Business plan
Boss > > > > Leader
Boss: "My way or the highway."
--Sign on CEO's desk
Leader: Jack Stack owns less than 20% of Springfield Remanufacturing's stock. Employees own the rest. Stack could have owned more of the engine-remanufacturing company's stock. "But that was plenty for me. Not wanting to be accused of being greedy probably had something to do with it, but more important, I didn't want to be alone. I was going to be leading the charge up the hill. I wanted to make sure that when I got to the top and turned around, there were people coming with me."
Male > > > > Mixed: In 1980, women owned a quarter of all sole proprietorships; in 1993, they owned one-third.
Supportive spouse at home > > > > Spouse runs own business
Automation > > > > Innovation
Automation: Big companies used expensive technology to automate the work people had always done. Often, the high price of that technology was a barrier that kept small businesses out of certain markets.
Innovation: Professional entrepreneurs use today's cheap information technology to let people do things never done before.
"A filing cabinet is just a box of papers," says Ben Narasin, CEO of Boston Preparatory, a clothing designer and manufacturer. "The same information set up on a computer network can give you a dynamic sense of your customers. You can pull up their history--the way they pay their bills, what they're talking about--and get a feeling for them. You get $10 worth of value for every $1 of information. When technology breaks down, you realize how effective it is when it's working."
Intuition > > > > Education
Intuition: Trip Hawkins's first company, founded when he was 19 years old, flopped. "I loved being an entrepreneur," he says, "but before I'd do it again, I'd figure out how to do it right."
Education: Hawkins studied for an M.B.A. at Stanford University and worked at Apple Computer before making his next entrepreneurial moves: launching Electronic Arts in 1982 and 3DO in 1991.
Research backwater > > > > Research mainstream
Research backwater: In the early '80s, when Congress wanted information on entrepreneurs and entrepreneurship, it didn't exist. Entrepreneurship research? Never heard of it.
Research mainstream: David Birch, Zoltan Acs, Bruce Kirchhoff, Bruce Phillips, Paul Reynolds, John Jackson, Donald Sexton, Howard Aldrich, Howard Stevenson, Jeffry Timmons, Bill Wetzel, Karl Vesper, and so on
Dozens--maybe scores--of academicians now specialize in entrepreneurial study, scrutinizing and analyzing processes and behaviors in organizations of all sizes and in all stages of development. Look for a lot more academic research on what makes entrepreneurial companies work.
Price takers > > > > Value makers
Price takers: Me-too competitors--Wendy's, for instance--could set prices at any point--as long as they were lower than the McMarket leader's.
Value makers: New competitors--Nike, for instance--create new categories and new price points.
Personal financial plan is the business > > > > Business is part of personal financial plan
Art > > > > Science
Art: What entrepreneurship was presumed to be
Science: "'Professionalized' means having a set of disciplines and routines that can be taught and applied. Professionalism doesn't eliminate the art in entrepreneurship, it strengthens it."
--Amar Bhidé, associate professor of entrepreneurship, Harvard Business School
Equity = control > > > > Performance = control
Equity = control: Vincent Yost, founder of Intelligent Devices, was reluctant to raise additional capital. To do so would have meant reducing his ownership of the company to less than 51%. By his logic, that would result in losing his control. "He'll discover," says Harvard Business School Professor Bill Sahlman, "that by not raising much capital, he'll have given up real control of his destiny anyway."
Performance = control: "Control comes from performance, even for CEOs. If you do the job well, you have all the control you need. If you don't, it doesn't matter how much stock you have. You won't be in control of your company."
--Mitchell Kertzman, Powersoft founder
Company > > > > Career
Company: Henry Ford, David Packard, Ken Olsen, Lillian Vernon, and countless others: the companies they founded were their careers.
Career: Career transcends company. Consider the résumé of Eric Kriss:
- CEO, MediQual Systems, 1993present
- Functional chief financial officer, Commonwealth of Massachusetts, 19911993
- Founder, MediVision, 1984; grew company to $50 million, then sold it, 1989
- Consultant, Bain & Co., 19791984; launched Bain Capital, 19841990
- Produced jazz and blues albums, 1970s
"It's more painful to sell a business," Kriss says, "than to start one."
Also read Creators of the New Economy, Part One by Tom Richman. "A new group of people is emerging out of the swelling entrepreneurial mainstream: genuinely professional entrepreneurs..."
