May, 2009

Unspecified Danger

Throughout my career I’ve always said that I dealt well with ambiguity. As a long-time freelancer I had to. I never knew what situation I’d actually be entering until I did so, and once in, I had to deal with whatever arose. We’re now in the midst of starting our own company in a fairly bleak (at least on the surface) economic landscape and pursuing and winning work of all sorts. Some have called us (my wife/partner and me) crazy but we both wholeheartedly disagree. While it’s certainly not easy to do what we’re doing — throw three kids under the age of 6 into the mix and it gets even more complicated — we are having fun and actually feel more in control of our situation than we ever did while working in someone else’s organization.

I bring this topic up because it’s something that has been popping up frequently over the past few weeks — in both conversations and the things that I’m reading. Just after starting exUrban, Inc. I was speaking with a very talented front end developer with whom I worked and who was laid off just after the new year. We were speaking about a job I was pitching, and I wanted to gauge his interest and pick his brain about the required level of effort. He was interested but felt very strongly that he must get back to a full time job for the stability factor. I asked him how the stability of our previous employer had worked out for him.

Other folks have said similar things to me: “I like freelancing, but I can’t handle the risk.” “Starting my own company scares me, it’s so risky.” “I hate invoicing . . . ” (really?). Recently, I had two conversations within three days that went similarly. One friend told me that he doesn’t know how people start their own thing. He’s an agency guy and likes to be on the inside where it’s less risky. Another friend, an academic, said “I don’t know how you do it” (start a company and all that comes with it). Then he explained how he gets funding for his projects and it dawned on him that he and I are both striving to fund our livelihoods.

There is certainly risk in what we are attempting to do but we mitigate it through hustle. We take every meeting, pitch everything that comes our way and conjure ways to succeed. If I can’t close a sale that’s my issue, but I’m moving to the next opportunity to try again. If I’m in an agency and some other guy doesn’t close a sale I lose my job because the funding will dry up. Where is the risk more pronounced — trapped in a box canyon or running free on the plains?

We, as entrepreneurs, and freelancers deal with ambiguity: is the job going to come through, is it not, what happens if it doesn’t, what happens if it does? Ambiguity abounds in each of these scenarios but I’ve got other pokers, in other fires, and odds are that some of these other things will heat up and come through. An interview with Jim Collins from the April 1, 2009 issue of Inc. magazine brought all of this home to us.

How do you define entrepreneurship?

I take a broad view of it. The traditional definition — founding an entity designed to make money — is too narrow for me. I see entrepreneurship as more of a life concept. We all make choices about how we live our lives. You can take a paint-by-numbers approach, or you can start with a blank canvas. When you paint by numbers, the end result is guaranteed. You know what it’s going to be, and it might be good, but it will never be a masterpiece. Starting with a blank canvas is the only way to get a masterpiece, but you could also blow up. So, are you going to pick the paint-by-numbers kit or the blank canvas? That’s a life question, not a business question.

It has to do with your ability to handle risk, no?

Not risk. Ambiguity. People confuse the two. My students used to come to me at Stanford and say, “I’d really like to do something on my own, but I’m just not ready to take that much risk. So I took the job with IBM.” And I would say, “You’re not ready for risk? What’s the first thing you learn about investing? Never put all your eggs in one basket. You’ve just put all your eggs in one basket that is held by somebody else.” As an entrepreneur, you know what the risks are. You see them. You understand them. You manage them. If you join someone else’s company, you may not know those risks, and not because they don’t exist. You just can’t see them, and so you can’t manage them. That’s a much more exposed position than the entrepreneur faces. But there’s lower ambiguity on the paint-by-numbers path: very clear but more risky. The entrepreneurial path: very ambiguous but less risk. Of course, the truth is that it’s all ambiguous, anyway. If you think you can predict the future, you’re crazy.

This quote has been our lodestar over these past weeks because it crystallized and validated what we’d been thinking all along. We’ve opted for the “life concept” of entrepreneurship and embrace the ambiguity. Within ambiguity lies opportunity, and that’s all one can ask for.

We are switching hosting providers. Please bear with us during this move. We hope that it will not be overly painful.

Thanks.

Image via Wikipedia

I finally joined FaceBook. More on that later, though it’s already provided me with fodder for this blog. A friend posted a comment about the number of Influenza A H1N1 “Swine Flu” outbreaks world wide — about 958 — and is it really something to be that freaked out about? I share his skepticism partly because I’m a skeptic, partly because I’m awash in various, independent web-based news streams.

One of the most interesting things to me has been the reaction to the “pandemic” as defined by the WHO on places like Twitter: skepticism, lack of concern, some outright mockery. Meanwhile, compare this to some of the reaction in the print and broadcast media where it seems it’s time to stock the water, rice and beans and line up for the Tamiflu vaccination. As is frequently cited, more than thirty thousand people die each year from good old fashioned influenza, yet that neither stops travel to Mexico nor compels countries to impose travel bans.

There is much information available on the web and other sources and rather than stoking fears of horrid flu-death, the freewheeling and self-governing social networks are behaving responsibly and forwarding info deemed useful, questioning alarmist information and avoiding panic. This current event recalls the ancient Y2K issue for me. In the late 90s, social networks like today’s were but a fantasy, and the ones that did exist tended to be list-serves and billboards. The panic and hyperbole around the devastation to our way of life as a result of computers’ inability to handle the double-aught was infectious — no pun intended — and all over the media. Mobilization to ward off the end of Western Civilization as we knew it seems to have paid off, but was it really as bad as everyone thought it would be? Did Y2K warrant the anxiety stoked by the general media — unchallenged, at that time, by social media?

Maybe, we in the skeptical camp are all whistling past the graveyard, but the measured reaction of the citizenry — at least the social media citizenry — to the H1N1 outbreak stands in stark contrast to the groundswell of anxiety in the traditional media. I bet that it would be interesting to compare attitudes towards H1N1 of folks who are active social media participants/web news consumers to those who only get their news from traditional media outlets.  I bet the latter are “more concerned” than the former. Though, on the other hand, I’d not be surprised if no one was freaked out about H1N1 because everyone is sick of the traditional news media. . .

I think that anxiety we see and hear in the traditional media derives from the fact that fewer people are listening to them, and that even with a possible “pandemic” they can’t attract the eyeballs that net the advertising dollars. The basic premise of news, for a while anyway, is that stories of death mayhem and destruction attract attention. However, in the case of H1N1 it strikes me that there is a big “who cares?” afoot and that’s a pandemic for traditional media.

Image via Wikipedia

Recently, we were on vacation. We drove to Dawsonville, GA and back, and stopped in Richmond, VA, Asheville, NC and Staunton, VA along our journey. We drove a sizable chunk of the Blue Ridge Parkway and saw a lot of country along the interstates, US-Highways and State Roads. We passed many farms and properties of varying sizes in various states of upkeep or benign neglect. One thing kept popping into my head as drove along: the people who live in these rural areas, across from pastureland and fields seem to be connected to the earth in way that many of us in our urban and suburban environments are not.

Of course, as a tourist passing through, I project onto the setting but there is something in the agrarian model that is appealing, a set of standards that must be followed in order to achieve success. You plant your crop at a certain time, harvest it at another. Watch for insects, fungi and other controllable pests and hope that the uncontrollable doesn’t come and wipe you out. You follow that rhythm year in and year out and hopefully with vigilance, hard work and some luck you succeed. There is a timelessness to the properties by which we drove, earned of perseverance, and the very probable reality that the farm has passed down through at least a few generations of successful farmers/entrepreneurs.

There is a lesson in this model for all of us in non-agrarian pursuits, I think. We are in the midst of a nasty economic blood-letting. Unlike the summer hale storm that devastates a sorghum crop, however, this nastiness is of our own making. Everybody forgot about following the basic business ingredients of hard work, perseverance and commitment. Instead, everybody chased bonuses built on the performance of shaky derivatives and other exotic investment products that should have given more sober people the yips. Now, nobody knows what is to come on the other side of our current economic issues.

It seems to me that there is a very real chance to remake our economy and the way business is done. This will fall largely on the entrepreneurs and the risk takers currently working to create their own niche and define the future economic reality for themselves, right now. One thing I do know for sure is that in this new future we need to hue to the time-tested examples of hard work, straight dealings, and solid and honest delivery. It’s time to get back to the basics.