And now, I'm thinking we might be on the cusp of a Stage Four. I'm putting a big question mark next to it, but I think we might be in a stage of going from a great company to a great movement.
A movement?
Yes, a movement. Something bigger than the company. Think about the early days of Apple, which went through all of these stages. They started with a great idea: "Gee, we've got this neat little computer. People want it." Then, they built a great business around the Apple II. Next came the conceptual step of saying, "Actually, Apple is a company from which many things will happen." The shift was very clear. And on top of that was the whole notion of a movement -- putting technology in the hands of individuals, giving them a lot more power.
You see that with a lot of Web 2.0 businesses: The customers become part of the company.
Exactly. So, maybe that's what we are seeing now -- idea, business, company, movement. And that's why I have the inclination to see Wendy Kopp as the heroic entrepreneur of the decade. She had a great idea. She proved its worth. She built Teach for America into a great company. But what she is doing goes beyond the company. It's about a process that will utterly transform people, and they in turn will utterly transform education in this country. That is a movement. And if you think about this and about these Gen-Y kids, they get it coming out of the gate.
In other words, it's not just about having a good idea or building a successful business or even a successful company. The movement is the ultimate expression of the idea.
Well, you can't have a great company if you don't have a successful business, and you can't have a successful business if you don't at least have a workable idea. So, in order to be a Stage Four entrepreneur, you have to have Three, Two, and One. You cannot build a movement without having a strong, strategically sound business underneath, held together by a really effective set of processes and values. Those mechanisms enhance the discipline of what you're doing and therefore enhance the creativity. Creativity and discipline go hand in hand.
I don't know Teach for America well, but I did go to see High Tech High in San Diego, and I was struck by how good a businessperson the CEO, Larry Rosenstock, is. Is that a change from a previous generation of social entrepreneurs?
I don't know if it's a change, but I think that, as time goes along, the line between the social sector and the business sector will become increasingly blurred. We tend to think that the business sector will teach the social sector, that the social sector is the less sophisticated cousin. In that, we are wrong. We may actually have more to learn from your friend at High Tech High and from Wendy Kopp than they have to learn from those of us in the business sector. Obviously, they have fundamentally different economic mechanisms. But leaders of social-sector organizations have to get things done without the same levers of power available to leaders in the business sector. Business owners and chief executives have had a tremendous amount of concentrated power. They don't really have to lead. If I put a gun to your head, I can get you to do a lot of things. It means I have power. It doesn't mean I've led. In business, we largely have power, not leadership. In a social-sector organization, power is diffuse. So, getting things done requires the ability to truly lead. If you want to create a movement, you can't order it or demand it or will it into existence by exerting concentrated power. It just won't work.
I'm curious about what you yourself learn from your studies of great companies. Do you get ideas you can apply to your company?
I know we're developing important things in our research when it changes me. Every study has had an impact on the way I go about doing what I do. What I've learned from the turbulence research has already started to affect my life. I've become a total paranoid, neurotic freak. It has shown me the importance of building in big shock absorbers. I keep a year's operating budget in cash in the bank across the street all the time and run this place so that we could go an entire year without a penny of revenue. I learned that from reading about Bill Gates in the early days of Microsoft. I want to be able to say at any given time, "If we don't get a penny for three years, we'll be fine." So, we can focus on our work.
You're a serious rock climber, and there seems to be something about business and climbing that resonates with people. The metaphors come tumbling out, one after another.
Climbing has had a gigantic influence on how I think about everything. I started climbing at 14, and it was the first time that I was really, really aware of consequences. Kids think they can get away with stuff, but gravity doesn't care if you have an excuse. It will kill you. It's completely indifferent. And I just gravitated to the idea that this is very real. It's also why I have such affection for entrepreneurs.
Do you consider yourself an entrepreneur?
