A Lesson from the Wizard: Look ahead, but don’t forget to look behind
The first lesson in this set comes to us from the behavior of Gandalf the Wizard in the Hobbit, which was the prequel to the Lord of the Rings trilogy.
In the book, Gandalf, has recruited the Hobbit Bilbo Baggins to travel with the 13 dwarves to the Lonely Mountain on an “adventure” to claim their long lost treasure, which is being guarded by the evil dragon Smaug. Sound familiar? Anyone who has been recruited on an entrepreneurial adventure to "find the treasure" can surely relate!
Like many “adventures” in the business world, at first the journey goes along swimmingly – they sing songs, light campfires, and otherwise enjoy themselves on the road. At some point, Gandalf leaves the party, and they suddenly find themselves without their leader.
How do they handle this situations? This "first adventure" has many implications for an entrepreneur who is just beginning his or her journey and the team of "adventurers" that he or she is leading.
NOTE: This is the first of a set of lessons about business, entrepreneurship, and life from my favorite fantasy and science fiction, such as the Lord of the Rings and the Earthsea chronicles – it’s from a book I’m working on tentatively titled: “Wizards at the Helm”.
It is a cold, rainy night, not even the dwarves are able to light a fire. Without Gandalf, the party is left in the dark to fend for themselves when suddenly they spot a fire in the woods. The party sends Bilbo to investigate, and they get into trouble with a set of monstrous trolls, who capture the hobbit and the dwarves and threaten to “eat them”.
This is their first “true adventure” on what I think is a very archetypal heroic journey, and as you can see it’s not an inconsequential one – their very lives are put into mortal peril!
Gandalf’s departure allows the party to “test its mettle” – and though they are found lacking and need to be “bailed out" of this incident, the episode represents an important point in the development of both Bilbo and Gandalf as characters and heroes.
Many early stage business ventures also face death when they first try to make it on their own. But it’s the trials themselves which harden up the group and prepare them for the challenges which lay ahead. It is important to get through this first set of trials, even if you have to rely on a board member, or a mentor, or a wizard who knows the terrain.
And in fact it is Gandalf, who has dealt with Trolls before, who shows up in time, plays a clever trick on the Trolls, and rescues the party. After they are rescued, the dwarves naturally ask Gandalf: “Where were you?”
He answers, “Looking ahead”
The next question from them is: “And what made you come back?”
“Looking behind.” said Gandalf.
What can this teach you as you go on your own “heroic journey”?
To truly be a wizard you have to be able to anticipate what’s going on ahead of the curve, and sometimes this means scouting out into the future and leaving others behind to take care of present tasks.
But even when you do that, no matter what you see, you can’t ignore what’s happening in the present. You need to not only be able to scout ahead, but also bring those with you on the journey safely through the "road of trials". But it's not enough to do it all yourself. You also need to give them room to develop their own abilities as “heroes” and not lean on you as a crutch. This will serve you in the long run.
Thursday 2 November 2006
Thursday 26 October 2006
Social Entrepreneur -a wacky idea turns into a Nobel Prize
Recently, as many of you might know, the Nobel Peace Prize was awarded to Mohammad Younus, from Bangladesh.
Mr. Younus, whose nickname was "banker to the poor", was the founder of Grameen bank, which started experimenting with a system of lending very small amounts of money to the poor, particularly women, in rural villages in Bangladesh. In doing so, Mr. Younas pioneered a system of "micro-credit" which has been implemented in many countries and is credited for lifting many millions out of poverty across many continents.
I was excited to hear about the granting of the prize to Mr. Younus for several reasons, not the least of which is that I'm from that part of the world (I was born in Pakistan around the time that Mr. Younus was starting his business).
I think entrepreneurs and aspiring entrepreneurs here in the US and around the world should be interested not just in his Nobel Prize but in his story - how he did what he did and what obstacles he faced.
In short, I think that it provides another story of how a "crazy" idea can grow to have unintended, positive consequences - not just financial, but also social and environmental. When Mr. Younas first started making his loans, which included amounts as little as one dollar, everyone told him he was crazy and that business model couldn't work. After all, bankers are taught to think in terms of large loans, hundreds of thousands of dollars for mortgages, and many millions of dollars for other loans.
He finally got so tired of the criticism that he decided to ignore the "traditional wisdom" and started making these loans without requiring any collateral. This was a key part of his model and exactly what most banks won't do.
Many of the women he loaned money to were referred to as "telephone women" because they would use it to buy a phone, which in many cases was the only phone in the village. The women would then offer phone services to the rest of the people in the village, starting their own "micro-businesses" which eventually grew.
This illustrates one important point - that entrepreneurship can be a force for social change - these entrepreneurs improved life for themselves and for their fellow villagers. The telephone calls established contact with the wide world beyond since calls would eventually start coming in from aroundt he world.
It also illustrates a second, equally important point: when people (experts, bankers, venture capitalists) tell you you're crazy and that your business idea / business model can't work, they may not know what they're talking about because your business model may be entrirely new.
This is doubly true when they tell you that "your market is too small" - in my opinion, this is the 'clue' which reveals that you may be on to something - i.e. you may have found a nice which others aren't able/willing to fulfill - one of the keys for successfully starting a bootstrapped business.
Remember that most investors (VC's, bankers, etc.) don't really do much innovative thinking themselves - they rely on so-called experts who may have no idea that there is an untapped potential in your target market, partly because it's "too small to pay attention to".
But, Mr. Younus, rather than relying on the experts, looked at what he was seeing in front of him: women who wanted to borrow money, had no collateral, and traditional banks wouldn't help them. I like to think of this as a 'clue' that's staring you in the face - and who are you going to believe - what the "experts" tell you, or your "lying eyes"??
I'll write more about "clues" that you see in front of you and how they can help you to start a business in later posts. You can also check out my book, Zen Entrepreneurship (www.zenentrepreneur.com) , which talks a little about this process, which involves the co-inciding of serendipity with your own preparation and desire to start a business.
Having been involved in high tech software startups and venture capital for so long, his story was an eye opener for me about the value of Entrepreneurship not just for the individual but for society as a whole, even when it's done on a very small scale that won't interest traditional investors. Last year I attended the MIT Global Startup Workshop in Abu Dhabi.
What surprised me wasn't that there were business school students there looking to start competitions which mimicked some of what we'd been doing in the MIT 50K (now 100K) business plan competition; what surprised me was that these efforts were being encouraged by the governments in places as far away as the Phillipines, United Arab Emirates, and Ivory Coast. What I had taken for granted (i.e. starting and growing companies) was something they wanted to institutionalize in order to jump-start their economies. It was one of those "aha" moments for me, since Entrepreneurship had always been a very personal journey for me. I'll be writing more about Entrepreneurship as a force for social change, and also how successful I think governments can be in "institutionalizing innovation" in later posts.
In the meantime, whenever someone tells you your market is "too small" or the "financial model" for your business idea will never work - remember Mr. Younus and his Nobel Peace Prize!
Mr. Younus, whose nickname was "banker to the poor", was the founder of Grameen bank, which started experimenting with a system of lending very small amounts of money to the poor, particularly women, in rural villages in Bangladesh. In doing so, Mr. Younas pioneered a system of "micro-credit" which has been implemented in many countries and is credited for lifting many millions out of poverty across many continents.
I was excited to hear about the granting of the prize to Mr. Younus for several reasons, not the least of which is that I'm from that part of the world (I was born in Pakistan around the time that Mr. Younus was starting his business).
I think entrepreneurs and aspiring entrepreneurs here in the US and around the world should be interested not just in his Nobel Prize but in his story - how he did what he did and what obstacles he faced.
In short, I think that it provides another story of how a "crazy" idea can grow to have unintended, positive consequences - not just financial, but also social and environmental. When Mr. Younas first started making his loans, which included amounts as little as one dollar, everyone told him he was crazy and that business model couldn't work. After all, bankers are taught to think in terms of large loans, hundreds of thousands of dollars for mortgages, and many millions of dollars for other loans.
He finally got so tired of the criticism that he decided to ignore the "traditional wisdom" and started making these loans without requiring any collateral. This was a key part of his model and exactly what most banks won't do.
Many of the women he loaned money to were referred to as "telephone women" because they would use it to buy a phone, which in many cases was the only phone in the village. The women would then offer phone services to the rest of the people in the village, starting their own "micro-businesses" which eventually grew.
This illustrates one important point - that entrepreneurship can be a force for social change - these entrepreneurs improved life for themselves and for their fellow villagers. The telephone calls established contact with the wide world beyond since calls would eventually start coming in from aroundt he world.
It also illustrates a second, equally important point: when people (experts, bankers, venture capitalists) tell you you're crazy and that your business idea / business model can't work, they may not know what they're talking about because your business model may be entrirely new.
This is doubly true when they tell you that "your market is too small" - in my opinion, this is the 'clue' which reveals that you may be on to something - i.e. you may have found a nice which others aren't able/willing to fulfill - one of the keys for successfully starting a bootstrapped business.
Remember that most investors (VC's, bankers, etc.) don't really do much innovative thinking themselves - they rely on so-called experts who may have no idea that there is an untapped potential in your target market, partly because it's "too small to pay attention to".
But, Mr. Younus, rather than relying on the experts, looked at what he was seeing in front of him: women who wanted to borrow money, had no collateral, and traditional banks wouldn't help them. I like to think of this as a 'clue' that's staring you in the face - and who are you going to believe - what the "experts" tell you, or your "lying eyes"??
I'll write more about "clues" that you see in front of you and how they can help you to start a business in later posts. You can also check out my book, Zen Entrepreneurship (www.zenentrepreneur.com) , which talks a little about this process, which involves the co-inciding of serendipity with your own preparation and desire to start a business.
Having been involved in high tech software startups and venture capital for so long, his story was an eye opener for me about the value of Entrepreneurship not just for the individual but for society as a whole, even when it's done on a very small scale that won't interest traditional investors. Last year I attended the MIT Global Startup Workshop in Abu Dhabi.
What surprised me wasn't that there were business school students there looking to start competitions which mimicked some of what we'd been doing in the MIT 50K (now 100K) business plan competition; what surprised me was that these efforts were being encouraged by the governments in places as far away as the Phillipines, United Arab Emirates, and Ivory Coast. What I had taken for granted (i.e. starting and growing companies) was something they wanted to institutionalize in order to jump-start their economies. It was one of those "aha" moments for me, since Entrepreneurship had always been a very personal journey for me. I'll be writing more about Entrepreneurship as a force for social change, and also how successful I think governments can be in "institutionalizing innovation" in later posts.
In the meantime, whenever someone tells you your market is "too small" or the "financial model" for your business idea will never work - remember Mr. Younus and his Nobel Peace Prize!
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