Most Entrepreneurs are Not Rock Stars - David Friedberg, The Climate Corporation video transcripts

Almost all Silicon Valley entrepreneurs are not rock stars, according to CEO David Friedberg. He offers metrics comparing the possible rewards and chances for success between working for an existing company and starting your own venture. He also explains the advantages and caveats of trying to make impact from inside larger organizations.

Transcript

To the sort of what I call the rock star motif of what entrepreneurism is, especially in Silicon Valley, and it's good. I mean there is a culture of taking leaps and doing big exciting things here and you're an important person if you do that. But just being an entrepreneur does not make one a rock star. The odds of the guy - or being the guy on the left are according to a study and I put the URL up there, 0.0006%, that's the odds of - I'm starting up a company and having the company be worth more than a billion dollars. However, all of the press coverage and all of the attention at Silicon Valley goes to the guy on the left. The person on the right is the status quo, your typical entrepreneur, your typical Silicon Valley startup team looks like the person on the right. There is a reason I look like I'm 50, and I'm only 31 years old, okay? The probability of being the person on the right is greater than 99%. And so, I would say, don't do a startup and don't try and solve a problem via a startup, if your goal is to have the status of the rock star entrepreneur because it is a false premise. The financial reward or the opportunity cost of doing a startup is very high. This is from that same study that I just used.

There are a lot of engineers here, I'm assuming 100% of you will have the ability to interview for a job at Google when you graduate, and if you were to get a job at Google when you graduate, the anecdotal evidence suggests that your first year salary would be about $105,000 this year. If you were to start a company and raise money from a venture capitalist and you were then able to sell that company or take that company public, your median time to doing that will be 49 months. And assuming three founders, your median expected payoff to the founders will be about $300,000 each, which works out to an annualized salary equivalent of $73,000. And the probability that you actually make no money is 67%. Okay? So, the reason for being entrepreneurial and the reason for forming a startup to solve a problem should not be for the financial rewards because the financial rewards, if that's your motivation would indicate that you are better off going to Google, going to a hedge fund, going to some other career that has stable income potential. If you were to get a job at an existing company, you would have the ability to make an impact. There would be lots of people there. There would be lots of resources there. There would be a platform upon which you could build something that could affect a lot of people. If you were to get a job at Google, they have 100 million users, if you launch the products to their 100 million users, you would have 100 million users.

If you were to try and launch that product on your own, you would have zero users and there would be a big, big, big challenge trying to get to 100 million users. So, my point here is that it's not necessarily a bad thing to go work at a big company. You can still have the potential like growing companies and succeeding companies and successful companies to make a big impact on the world, to make a big impact and have a large number of customers use something that you build or do something that's a result of your effort. However, you need to be forewarned that at a big company, there can be a problem with misalignment. So, the big company has to make money by doing X or Y or Z and you want them to do A or B or C because you think that would be a good idea. And so the big company's decision will be to continue doing X or Y or Z and say, sorry, you can't do A or B or C. That's misalignment. And so your personal ambitions, your personal interest or your personal product idea or solution idea for a problem is not an alignment with the big company. Scale can constrain a big company's ability to do things. So, big companies might have several people involved in the decision-making process and that can make it that much more difficult for you to get a decision made that what you're trying to do is worthy of resources and worthy of showing to the 100 million users and so on and so forth.

And finally resources can't be recruited within a big company. You don't own your destiny. Resources are granted to you. You were told, here is how many people can work on your team and here is how much money you're going to have and here is how long you are allowed to apply your time for which we're paying you to do X or Y or Z. And so, there are challenges to doing things in a big company and they all need to be sort of taken into consideration. And I wanted to highlight some of these points because I don't want to say, be entrepreneurial, I want to make sure that everyone in this room walks away from this discussion today and is completely reflective about what it is you want out of life. 

How Do You Find Your Passion and How Do You Pursue It? Randy Komisar, Kleiner Perkins Caufield & Byers

http://ecorner.stanford.edu/videos/1000/How-Do-You-Find-Your-Passion-and-How-Do-You-Pursue-It

Instead of thinking about the passion, explains Komisar, free yourself to think of a portfolio of passions. Marry this portfolio with the opportunities in front of you, he says. Think of it as a quest towards which you are moving in the right direction, he adds.

Transcript

       You know there's a couple of questions, persistent questions that come out of that book that I'd like to address. One of them is this notion of how does somebody choose their passion? I know this is particular with students and what I notice is a student will come to me and say, "How do I know what my passion is?" and I was perplexed by that question for a while and then I thought back to my own time as a student and after recently graduated. And I realized I was passionate about everything. I loved everything. Again, life was a fire hydrant. And what I've sort of, how I've addressed that question over time is rather than thinking about the passion, free yourself up to think about a portfolio of passions and the task is to marry that portfolio of passions to the opportunities in front of you. The question that will paralyze you, two questions will paralyze people. One is, what is the passion that will paralyze you? Because now you're going to optimize amongst 10 things that seem like they might be your passion or not. The other thing is, what's the ultimate question? What is the ultimate thing that you're going to do with your life? What is the ultimate mark you're going to make? What is the farthest horizon that you can articulate? Those two questions will drive you crazy and paralyze you. I find it the last, the second question was theorized and needed to be simplified to north, south, east, or west.

        What are my values? What do I care about? And to think about the horizon rather than a point on the horizon. Because the horizon by definition is always outside of your grasp. But it can give you a direction. You can know that you're heading north not south. Then comes the issue of how do you make a decision today based upon, you know, the things you need to do or feel you want to do. Well, that's a foreground/background issue. No! Forget the horizon. I'm facing north. What are my opportunities facing north? What's in front of me or what's proximate? What opportunity can I create facing that direction? Forget ultimately where I go. Look right in the foreground, what's there? How do they sync up with my passion? How do they sync up with the passions that I have today? And now if it comes an issue of just choosing between right answers.

       A discussion with a good friend of mine who's an analyst with UBS and we're talking yesterday and we said, you know the biggest issue is not choosing between a right answer and a wrong answer. That's easy. The hardest thing to do in life is choosing amongst right answers. It's the issue of optimization. Optimization will drive you crazy. And so the issue in my mind is to make a decision based upon a set of right answers as they marry up against what you really feel here about them. And then do them. And so you got this notion of, you know, you got 10 doors in front of you, you're going to walk through one. You have that immediate sense of loss. Nine doors closed.

      Guess what? Ten doors just opened. And if you begin to see life that way, it becomes easier to make decisions and move forward. My career makes no sense at all in the windshield. It only makes sense in the rearview mirror. And that I think applies to lots and lots and lots of people in their lives and careers. So if I was going to write an epilogue, I think I would address those two issues and try to clarify them a little bit. 

Are Successful Entrepreneurs Born or Made? By Jeff Sandefer - highlights

Are Successful Entrepreneurs Born or Made? By Jeff Sandefer

Is the secret to success Skill, Character, or Luck?

“Skill,” a business owner said. “And particularly the ability to sell.”

“It helps to be born with an engaging personality,” the man who had built a fortune in rent houses added. “But that’s no substitute for knocking on door after door and every time you are turned down, having the courage to knock again. Sales is a matter of learning about human nature, yours and theirs, through trial and error.”

A list of important skills soon followed:

• “The ability to find good salespeople and manage a sales force.”

• “Having a firm grasp of which numbers are important.”

• “Knowing how to put together an assembly line or service delivery process.”

 More skills were added to the list:

• “Being able to communicate clearly.”

• “Listening and questioning customers.”

• “Being a problem solver; thinking.”

• “Being curious enough to uncover and unravel the strategies of competitors.”

“Character trumps skill,” the junk dealer said. “Perseverance is far more important than skill or talent. You have to have a mindset that never gives up, no matter how tough it gets. A little talent and a lot of hard work are the foundation for learning any skill, and are far more important in the long run.”

Other important character traits soon followed:

• Basic curiosity

• Fairness

• Courage

• A relentless pursuit of opportunity

“But what about luck?” I asked.

Silence.

“Surely you believe luck has played a major part in your lives?”

“Sure, luck played a part,” the junk dealer said. “But you asked about success. Luck is the difference between making a million dollars and ten million or a hundred million. It’s not the difference between success and failure. Each of us was going to be a success; it was just a matter of how long it took.”

an unexpected lesson

I realized that I could capture each of the orphaned words and phrases under one of three headings: “Industry Expertise,” “Good Business Judgment,” and “Reputation and Relationships.”

Industry Expertise - Some assets are built during competitive battle. They’re made one sales call at a time, through countless trial and error experiments making and delivering products, each time keeping a keen eye on the reaction of competitors.

Good Business Judgment - Then, there are the assets built during the daily struggle of making operating decisions. Decision by decision, one success and mistake at a time, entrepreneurs accumulate a robust inventory of lessons in how to operate a business.

Relationships and Reputation - Last are the invaluable bonds and assets formed as you work with other people. Every time you keep a promise, act kindly toward another, or show character when times are tough, you add another deposit to your account.

The most difficult task for most businesses is attracting the right customers, employees and investors. Doing things right and doing the right thing build strong relationships. So does being honest and direct. And going the extra mile. Strong relationships, through word of mouth, build reputation.

the secret: stay the course

That’s when the secret hit me. Yes, these successful entrepreneurs had taken the time to master critical skills, usually in areas where they had raw talent. Character too had been important, especially perseverance and honesty. And luck had played a role, though most would have been financially secure without it, and some even felt that excess riches were more a burden than a blessing.

So in the end, what made them different from others who hadn’t been as successful and fulfilled? They had stayed the course. Day after day; year after year.

My Personal Board of Advisors

If you could have anyone, living or dead, to be on your personal board, advising you on life and the decisions you make, whom would you choose?

                                                                  

                                                                             

                                                                            

Ron Bailey -Chairman

I choose Ron as my chairman because he is my husband and my life choices affect him as well as they affect me.  I trust him with my life and know that the decisions we make are for the good of both of us.  We have been married for 24 years and we are equal partners.  I supported him when he went back to school when he started on his path to health and fitness. He has supported me in my journey to going to school.  We have been through financial struggles and we were able to communicate well with one another to be able to pull ourselves out of our struggles.  We have two children that we have raised together with the same values and teachings to our children.  Ron is my life partner who always has my best interests in his heart.

Mom (Donna Murphy) – Board Member

I would have chosen my mom because she was my personal advisor all my life.  She was the one who pushed me as a 19-year-old to go out to the dance where I met my husband.  She supported me in my decision to marry.  My mom was the one who was with me during the delivery of both of my children when I was scared she was encouraging me and letting me know that I could do it.  Then after I had my children my mom was there to help me with the questions I had about bringing them up.   She never told me what to do, she always said “if I were you” and then she would tell me what she would do.  I loved that she did not ever tell me what to do, she let me make my own decisions and then supported them even if it was not what she would have done.

Alicia Bailey – Board Member

                I choose my daughter, Alicia, because she is always challenging me to be a better person.  She is intelligent and competitive therefore she likes to challenge me to see who can get better grades.  I love that she helps me engage in using my brain and pushes me to learn as much as I possibly can.  Alicia is my daughter and best friend so she challenges me because she wants me to know that I can do it on my own.  She is the most level-headed twenty-year-old I know.  For example, she got her first job when she was eighteen years old working for a department store as a truck unloader.  She was disciplined enough to save almost all of her paychecks so that when she turned nineteen-years-old she could pay cash for her first car.  She did not want to get a loan but she wanted a car.  Now she has to pay for gas, maintenance, and insurance.  She is saving her money now so she can come to BYU-I for the winter semester.  I chose her because I know she will challenge me and help me learn to be as disciplined as she is.

Bishop Werner – Board Member

            I choose my Bishop because he is knowledgeable in life skills.  He has always been there to help me remember my Heavenly Father in times of distress and in good times.  Bishop Werner has always reminded me to do my service whether that be in the church or in my community.  I love my Bishop and I respect his opinions.  He has always given me sound advice, not always what I want to hear, but always what I need to hear.  Bishop Werner does not appear to be judgmental, and he directs me down the correct path by small comments he makes.  He has always been there for me when I have needed a blessing or when I’ve needed a spiritual boost.  I choose my Bishop because he is supportive of me and the decisions I make.

Valerie Oliver – Board Member

            I choose Valerie because she is my manager at work and my mentor.  I like her leadership and try to imitate her leadership often.  Valerie is very open and honest with me and her dealings with the company.  I respect her as a person and a leader. She has helped me grow as a leader and has good advice for me when I need to make an important business decision.  I trust her opinion because she has been a manager/leader for over 20 years and she knows her business inside and out.  Valerie manages over 200 employees every day and the employees are happy and continue to work for her.  She has shown me to be a good leader you need to get to know your employees as people and be friendly.  Valerie is a good inspiration to me.

Rob Hamilton – Board Member

            I choose Rob because he is my older brother and has owned his own janitorial company for over 15 years and he has been doing very well with it.  He has taught me how to find good employees who will fit the company’s needs.  He has shown me how to schedule employees, he has had me work with him when someone calls out sick.  I have seen him be in charge and the authority he brings to the table.  I want to aspire to be like him.  Rob has always challenged my financial decisions.  He asks me why I’m spending the money? Not what is it for but why do I feel it is necessary to spend it and could it be better used somewhere else.  I would defiantly choose Rob to help me keep a level head about my business finances.

Tonya Hamilton – Board Member

            I choose Tonya for a couple of reasons, first being that she has worked for a credit union as a loan officer for the last 10-years and second because he has Multiple Sclerosis.  She was hospitalized for more than 2 months and she lost her sight, could not walk and all around did not feel good.  Tonya is my sister and I have watched her when she was that sick to come back 1 year later and go back to work.  She fought hard to regain her health and join the working world again.  I love to see the strength that she has and I hope that she can share her strength and determination with me.  I choose Tonya because she is a strong independent woman who knows what she wants and goes after it.

Perseverance James E. Faust Second counselor in the first presidency - notes

Perseverance

James E. Faust

Second counselor in the first presidency

Perseverance is demonstrated by those who keep going when the going gets tough, who don’t give up even when others say, “It can’t be done.”

Here are some blessings a young man can receive by serving a mission:

1. How to organize and use time wisely
2. The importance of hard work—that you reap what you sow
3. Leadership skills
4. People skills
5. The value of gospel study
6. Respect for authority
7. The importance of prayer
8. Humility and dependence on the Lord

Perseverance is demonstrated by those who keep going when the going gets tough, who don’t give up even when others say, “It can’t be done.” 

There were four elders, Ezra T Benson, Lorenzo Snow, Alma Smith, and William W Cluff sent on a mission to Honolulu when their small boat was hit with a big wave and then another from the other side as they were reaching the shoreline.  The boat tipped over and the people on the shore came out to help.  There were three elders swimming towards the tipped boat and the people brought them aboard their boat.  They could not find the fourth elder, elder Snow so the people were jumping in and searching for him and the did find him, stiffed and lifeless they pulled him aboard the small boat and laid him across the laps of elder Smith and elder Cluff who prayed asking the Lord to spare his life. When they reached the shore the elders found some empty barrels that they laid elder snow face down on and began rolling him back and forth releasing the water he had swallowed.  The elder worked on him for some time with no indication of life. They were determined to not give up so they said another little prayer.  They were impressed to do something that was unusual for that time, one of the Elders placed his mouth over Brother snow's mouth and started breathing in and out trying to inflate his lungs taking turns with the other two elders they persevered until they were successful in inflating his lungs.  With their perseverance, all four of the Lord's servants survived and were able to complete their mission.

All of our latter-day prophets are examples of determination through the priesthood, prayer, and work. Joseph Smith showed perseverance through the restoration of the gospel. He was ridiculed and treated with contempt from the first time he told his first vision to the translating of the Book of Mormon. 

Brigham Young showed perseverance, he had the bold determination to bring 60,000 people from their lands and homes to the wilderness, traveling by foot, wagons, and pulling handcarts to the dessert where they made their homes.  President Gordon B Hinkley was called as the president and was asked what his plans would be and he said "to carry on" to carry on this great work.  Gordon B Hinkley when on to having 87 temples built, dedicated, rededicated or announced. 

“Making a living and a life” Elder Lynn G. Robbins of the first quorum of the seventy - notes

“Making a living and a life”

Elder Lynn G. Robbins of the first quorum of the seventy

This article is about our motives for working for money.  Money itself is not evil and that it represents “the sweat of our face” - a commandment of the Lord. It is the love of money which is evil.  We learn that doing well on our mid-terms and final exams is not what measures us to be good people it is the celestial tests the Lord will be monitoring as we go about our daily lives.  Are we building His kingdom including strong and valiant families? Are we honest in our dealings with our fellow man? Are we using our God-given talents in service? And, if you are fulfilling your life with good works, are you positively impacting your community and the world?  Elder Robbins compares our day with Adam and Eve’s day.  Satan did not have as much to work with when Adam and Eve were learning to till the earth.  Adam did not have to base his needs on what his neighbor had because he did not have a neighbor. There was no coveting, jealousy, envy, or selfishness.  There was no competition or comparison until Adam and Eve started to replenish the earth.  Satin could then use comparison and competition to appeal to man’s pride.    We know from the story of “A Christmas Carol” that Ebenezer Scrooge was a ruthless money lender, who was cruel, and stingy. His motives evolve and change as the story goes on Scrooge develops into a caring and charitable, businessman, and philanthropist.  If the love of God and our fellowman are our motives, then we are helping to build His kingdom. We are not working for mankind, but living for mankind trying to lift and help our fellow man.  The story goes on to talk about those who are working for money first and man-kind second and how this type of person is one who loves God but does not put him first, therefore, he puts loving his fellow man after his love of money.  The next type of person is one who also has a love for money but he does not love his fellow man. The love of money is his motivator to continue working.  This is the type of person who wants to be better than everyone and he will compete until he is the best and makes the most money. The next level of man is one who loves money and will do anything including harming a fellow man to get it.  The lowest type of man is one who loves money, will harm or kill for it directly. These are the people who will support the things that could harm the community such as pornography.  They not only will sell it they will be the ones who make it.  In conclusion, may we all strive to build up Zion and be honest with our dealings with our fellow man and in making decisions in our business and home lives?

Lee Barney---CIT Industry outlook Video notes

Businesses today cannot survive without technology

Most people do not realize that our community relies on just in time product. --this is when (like a grocery store) only orders when they think they are about to run out.  They do not have anything stocked away.  They will lose money because their produce will go bad and then they cannot sell it. They are using up space they can be used for other things. Pretty much all businesses are driven in a "just in time environment."  It is impossible to do "just in time" delivery without computer technology.

The future in technology business is going through a radical change.  Companies are moving to mobile devices…as people in business we need to embrace this change. The mobile our businesses become the more profitable we will be.