Essential Entrepreneurial Advice for Every Graduate
Editor's note: This speech was given at the University of Minnesota and then appeared on steveblank.com.
I am honored to be with you as we gather to celebrate your graduation.
This school has a distinguished roster of graduates... Earl Bakken, the founder of Medtronic, was an Electrical Engineering grad; and Bob Gore of Gortex and your current president are both alums of your Chemical Engineering program.
In fact, I feel very connected to another one your grads. I’m sure you’ve heard of Seymour Cray; he built a supercomputer company in Chippewa Falls that made the fastest computers in the world. These were very expensive supercomputers. They cost tens of millions of dollars and filled two tractor-trailers worth of space.
Back in Silicon Valley, I co-founded a company that built desktop workstations powerful enough to compete against Cray. We bid against them in a sale to the Pittsburgh Supercomputer Center... and lost. I never forgot that loss because instead of buying hundreds of our small computers they spent $35 million on that Cray. My startup never recovered and soon after went out of business.
Fast-forward 15 years. Now retired, I noticed that the Pittsburg Supercomputer Center had put their Cray for sale on Ebay. Yep--the $35 million machine was now for sale for $35,000 dollars.
I bought that Cray... honest... you can Google “Cray on eBay” and there I am. I had it shipped to my ranch and kept it in the barn next to the cows and manure.
It was closure.
But the story about Cray is also a story about success and failure. If I can keep you awake, I’m going to tell you why--while you may have thought today was the end of your education--it’s really only the beginning. And while you might be moaning about that thought, pay attention because what I’m about to share could make a few of you very, very successful.
First day of your life
For most of you, college was the first day of your own life. The morning you stepped onto campus you were no longer just a child of your parents. College was the first place you could taste the freedom of making your own decisions--and in some of those mornings-after--learn the price of indulgence and the value of moderation.
Here at school you had your first years of taking responsibility for yourself. While it may not be obvious to you yet, your college years were a transition from having your parents make decisions for you to making decisions for yourself. But now you face a new chapter that--if you’re not careful--could result in having companies make decisions for you.
It might turn out that graduating from college and getting a job may be just an illusion of independence. If you’re not careful you’ll simply end up having others tell you what to work on, how to spend your time, when to show up and when to go home. In fact, working in a company could be the adult version of listening to your parents tell you what to do... only the pay is usually a whole lot better than your allowance.
For some of you, that may be exactly what you are looking for. Many of you are going to take what you learned here, get a good job, get married, buy a house, have a family, be a great parent, serve your community and country, hang with friends and live a good life. And that’s great. Minnesota is a wonderful place to hunt, fish, canoe, raise kids, and pursue lots of interests other than just your job.
All of you will ultimately make a choice... a choice about whether you “work to live” or you “live to work.” This should be a conscious choice. Don’t get trapped into the daily routine of showing up and just getting by.
While you’re excited about your first “real” job, recognize that your interests and those of your employer are probably not the same. Having your employer tell you what a great job you’re doing and rewarding you for it is not the same as discovering your passion, and figuring out who you are, and what’s rewarding for you.
What I am saying is, “Don’t let a career just happen to you.” And as much you love, respect and honor your parents, don’t live their lives. Your obligations to meet their expectations ended the day you became an adult.
At the end of the day, you can decide whether you want to be an employee with a great attendance record, getting promoted to ever better titles and working on interesting projects--or whether you want to attempt to do something spectacular--this be or do should be a question you never stop asking yourself--for the next 20 years, and beyond. Be? or Do?
Let me share with you the day I faced the Be or Do question.
Big Company versus Startup
Out of the military, my first job in Silicon Valley was with one of the most exciting companies you never heard of. By the time I joined it was a decade old, and no longer a startup. Our customers were the CIA, NSA, and National Reconnaissance Office. Our CEO, Bill Perry eventually became the Secretary of Defense.
In the 1970's and '80's the U.S. military realized that our advantage over the Soviet Union was in silicon, software and systems. These technologies allowed the U.S. to build weapons previously thought impossible or impractical. The technology was amazing, and somehow in my 20’s I found myself in the middle of all of it.
Building these systems required resources way beyond the scope of a single company. A complete system had spacecraft and rockets and the resources of ten's of thousands of people from multiple companies.
If you love technology, these projects are hard to walk away from. It was geek heaven.
While I worked on these incredibly interesting intelligence systems, my friends in startups worked on new things called microprocessors. They’d run around saying, “Hey look, I can program this chip to make this speaker go beep.” I’d roll my eyes, comparing the toy-like microprocessors to what I was working on--which was so advanced you would have thought we acquired it from aliens.
But before long I realized that at my company, I was just a cog in a very big wheel. A small team had already figured out how to solve the problem and ten’s of thousands of us worked to build the solution. Given where I was in the hierarchy, I calculated that the odds of me being in on those decisions didn’t look so hot.
In contrast, my friends at startups were living in their garages fueled with an energy and passion to use their talents to pursue their own ideas, however unexpected or crazy they sounded. “Really, you’re building a computer I can have in my house?”
For me, the light bulb went off when I realized that punching a time clock is not the way to change the world. I chose the path of entrepreneurship and never looked back.
Engineers Run the World
Engineers used to be the people who made other peoples ideas work. Today, they change the world. We live in a time where scientists and engineers are synonymous with continuous innovation. We don’t think twice as our phones shrink, our computers fit in our pockets, our cars run on batteries, and our lives are extended as new medical devices are implanted in our bodies. Scientists and engineers no longer work anonymously in backrooms. Today we celebrate them for improving the quality of peoples’ lives.
George Bernard Shaw once said, “Some men see things as they are and ask why. Others dream things that never were and ask why not.” Engineers like you have the capacity to move the world forward by continually asking “why not?” It’s your special “doing” gene that empowers us to do better.
You invent. You imagine. You see things that others don’t. Where others see blank canvases, you’ll see finished paintings. You hear the music that’s not written, you see the bridges that have yet to be built. You envision the products and companies that don’t exist yet.
Only In America
University of Minnesota Science and Engineering alumni have founded more than 4,000 active companies, employing over ½ million people and generating annual revenues of $90 billion. These alums chose not to take the safe road but instead to push beyond their boundaries and DO.
At some time you might decide that you want to become the master of your own destiny--that you want to take an idea--and start your own company. And all of you sitting here just earned a degree that gives you choices that very few other professions have.
Entrepreneurship is not something foreign--it’s built into the DNA of this country. America was built by those who left the old behind. Not too many generations ago your family packed up what they had, got on boat and came to America. They struck out across the country and ended up here in Minnesota.
And what’s great about the United States... No other country embraces innovation and entrepreneurship quite like we do. You don’t have to stay in one job, and it’s really, really hard to starve to death.
I predict that 78 percent of all commencement speeches this year will have advice about “pursuing your passion and doing stuff you love.” But they don’t tell you why. Well here’s the secret--if you’re going to spend your career in a company, doing stuff you enjoy will help you keep showing up.
But if you want to do something, something entrepreneurial, just loving what you do is isn’t enough. You’re pursuing ideas you can’t get out of your head. Ideas that you obsess about. That you work on in your spare time.
Because that fearless vision and relentless passion are what it takes to sustain an entrepreneur through the inevitable bad times--the times your co-founder quits, or when no one buys, or the product doesn’t work. The time when everyone you know thinks that what your doing is wrong and a waste of time. The time when people tell you that you ought to get a “real” job.
By the way, every year I remind my students that great grades and successful entrepreneurs have at best a zero correlation--and anecdotal evidence suggests that the correlation may actually be negative. There’s a big difference between being an employee at a great company and having the guts to start one.
You don’t get grades for resiliency, curiosity, agility, resourcefulness, pattern recognition and tenacity.
You just get successful.
The downside of starting something new is that’s it’s tough, because unlike the movies--you fail a lot. For every Facebook and Google, thousands never make it.
Like Rocket Science Games, which was my biggest failure. 90 days after showing up on the cover of Wired Magazine I knew the game company where I raised 35 million dollars was headed for disaster.
We’d believed our own press, inhaled our own fumes and built lousy games. Customers voted with their wallets and didn’t buy our products. The company went out of business. Given the press we had garnered, it was a very public failure.
We let our customers, our investors, and our employees down. I thought my career and my life were over. But I learned that in Silicon Valley, honest failure is a badge of experience.
All of you will fail at some time in your career... or in love, or in life.
No one ever sets out to fail.
But being afraid to fail means you’ll be afraid to try. Playing it safe will get you nowhere.
As it turned out, rather than run me out of town, the two venture capital firms that had lost $12 million in my failed startup actually asked me to work with them again.
During the next couple years... and much humbler... I raised more money and started another company that we were ultimately able to take public, and those patient investors more than made up for their earlier loss--many times over.
As scientists and engineers, you know about failure. You know that virtually no experiment works the first time. And in a new company all you have is a series of untested hypotheses. You learned something vital in school--to test your hypotheses by designing experiments, getting accurate data, analyzing the results, and then modifying your initial hypotheses based on those results. This is the scientific method, and surprisingly we found the exact same method works for startups.
Because failure is a part of the startup process. In Silicon Valley, we have a special word for a failed entrepreneur--it’s called experienced. Our country and our entrepreneurial culture is one of second and third chances. It’s what makes us great. You don’t have to change your name or leave town. Entrepreneurs in America know that they get multiple shots at the goal.
Be or Do
Someday several of you in this graduating class will be worth a $100 million dollars. And a few of you might change the way the world works.
I want you to look around you. Go ahead. Take a few seconds and give it a look...
While most of you were looking around wondering who this was going to be, I hope a few of you were feeling sorry for the rest of your classmates, knowing that the most successful person in the audience is going to be you.
These days I write a blog about entrepreneurship. At the end of each post, I conclude with “lessons learned"--a kind of Cliff Notes of my key takeaways. So that’s how I’ll finish up today.
Here are the two lessons that I’d like to pass on to you.
Your science or engineering degree gives you tremendous choices--you, and no one else gets to decide two things:
whether you choose to be or you choose to do
whether you “work to live” or whether you “live to work”
Remember… live your life with no regrets. There’s no undo button.
And congratulations--you’ve earned it!
Thank you very much.
STEVE BLANK | Columnist | Founder, E.piphany, Convergent & Zilog
Steve Blank is a retired Silicon Valley serial entrepreneur turned educator who developed the Customer Development methodology that changes the way startups are built. His book The Four Steps to the Epiphany launched the Lean Startup movement.