Thursday, July 26, 2012

The Actual "X" Factor

I have done some armchair, sandlot-league analysis of local businesses here on the site before, and have since learned that I was focusing too much on the wrong stuff when doing so.

Back in the spring, I heard Desh Deshphande speak at Appleton Mills, where he emphasized that he's not overly concerned with business ideas when he's assessing the likely odds of would-be entrepreneurs.  Instead, he's way more focused on assessing the entrepreneurs themselves.  In fact, he went so far as to say that he would rather place his chips on "A-people with a B-idea" than on "B-people with an A-idea."

It was the first time I had ever heard that said, but it really stuck with me, because I've got a strong entrepreneurial bug but no precise vision of what I want it to turn into (although someone gave me an idea today that really got some wheels turning up between my ears).

Anyway, I've been doing some more reading and learning, and I've now heard that theme come from plenty of other places.  I am really enjoying Philip Delves Broughton's "Ahead of the Curve" (I put it in the 'good memoir' category because the descriptive detail is great and the author shows real vulnerability and imperfection as opposed to raw self-promotion).  Anyway, PDB's book is a recounting of his time at business school...in the book he talks about received wisdom regarding start-ups which is right in line with Desh.  To paraphrase: "Most ideas are good.  In fact, the overwhelming majority of new business ideas are good.  The big variable in whether success or failure will result is the  management behind the idea."

To Lowell-ize that, Brew'd doesn't do so well just because people need coffee and sandwiches at 61 Market.  Andy's community ties, business approach, and consistency create strong ties that keep bringing people back.  The ICC coming to downtown is obviously awesome for Andy, but that's not heavenly manna for everyone (witness the revolving door just across the street next to Wings).

How will Lowell handle the Vietnamese Fro Yo cartel?  I'd way rather be at 360 Merrimack than tucked away at Dutton and Fletcher when the after-school flood of humanity rolls up Merrimack Street on afternoons in the fall, but management still matters, so I wouldn't bet on one and discount the other just because of location and foot traffic.

Kad Barma performed an excellent skewering of Jon Stewart's defense of President Obama's recent gaffe about who deserves the credit for starting businesses.  As he rightly pointed out, we shouldn't split hairs about the words [If you said there 57 states during a speech, I wouldn't actually think that you thought that...gaffes are just part of public speaking], but we should debate the idea behind them, which is in fact rather clear when viewed in the context of the President's other words and actions.

Who really deserves the credit for driving the economy?

My money, and my heart, is with the entrepreneurs.

And the concept that the who, as opposed to the what, behind a business idea is what really matters, only serves to reinforce that further in my mind.  

5 comments:

Progressive Veterans said...

Could you help me with something, Greg? How many of these "sweat of the brow heroes," actually partake of the myriad of local, state and federal subsidies to survive long enough, get fat enough, become attractive enough to sell off to the highest bidder?

I'd like to start a meme.

"Big Gubmint" staves off "Big Biznuss" just long enough to sell out.

Wal-Martization of American business culture is a trend. Taxpayers hold off the wolves, long enough to make the neck juicy enough to offer itself.

Of course, some say, any reblooded Capitalist would do this. Yes, that is what I hear.

Freemarketeers, please stop spitting at those that see how the magician is really an illusionist.

I've seen carts lined up in the median strip of the main highways into Sao Paulo, Brasil selling water and chewing gum.

They are entrepeneurs!

- Jack

The New Englander said...

Jack,

I hereby charge you with one count of false dilemma creation.

All of my professional training/experience/employment to date comes from the gubmint.

The gubmint is about to fork over 94k (over two years) for me to fill my head with ideas about business creation. The Stafford and Perkins loans that will round out the rest of that (the living expense part) are subsidized by, well, the Gubmint.

The first person I called when someone suggested a service business that might work was the NCO that I spent 18 hours a day with for pretty much all of 2011 [through a government position].

Every little bit of experience, opinion, background, etc. that I've formed in the past 7 years has happened through the prism of working for Uncle Sam (or Uncle Patrick?) observing what works and what doesn't.

Government health insurance also swooped in on my behalf when I needed it in a big way in 2010 (MEEI), and then again in March 2011 (Tufts New England).

None of that is lost on me in any way. Neither is the fact that the guy selling water and chewing gum does that along a highway which is a public good (nonrival, nonexcludable) paid for by the Brazilian government, as drivers who use a fuel mixture influenced by the Brazilian government stop to buy with a currency backed up by, well...you get the idea.

All that said, my own free will -- not a governmental decision -- will determine whether I ever do take the monumental leap into entrepreneurship.

A firm that once didn't exist, but then springs up and employs a dozen people, does so within a system under which the government provides basic safety protections, regulations, guaranteed property rights, etc.

However, it does so by the "sweat of the brow" of the people who step up and make it happen. Should I ever become successful in the field, I would earn the right to the title "Job Creator," in a way that someone who created a new Pentagon "Defense Research Coordination Office" (I just arbitrarily made that title up, nothing intended) that employed 10 people averaging 90k in the Beltway just honestly would not.

To go back to my successful local business example, Brew'd isn't there because of the government...and the change in their revenue from 2008 (when you could actually find a seat in there on a late weekend morning) to 2012 (when you can't) has less to do with the government than with the sweat of people's brows.

Progressive Veterans said...

You may know the specifics, but I will use Brew'd as a metaphor. If a TIFF or the Lowell Plan were involved, or maybe even the local banks using subsidized loan programs, it is likely Brew'd IS there Because of the government.

That said, that help was a boost and has depleted. And most likely, the reason why Brew'd is STILL there is because of all the fine qualities that Americans admire. Not just, "Scott Brown Republicans." ;v)

I can get stuff slightly cheaper at the Depot, but I make a habit of going to AG Hardware to reward those with sweaty brows. Plus, the service is much better. I get how it works.

- Jack

C R Krieger said...

And, Ace is practically just across the street.  Didn't someone say "location, location, location".

When we think Government, should we not be thinking "The Tax Payers"?  Yes, the Feds can print money, but the Commonwealth, County (what there is of it) and City can not.

I think the question is, did the People form a Government to achieve common goals, or did a Government form a people to allow them to have jobs?  The first is the American view, in cartoon format.  The second is the French view, in cartoon format.

I will say that Kad got things stirred up today.

Regards  —  Cliff

C R Krieger said...

Additional comment.

I think Greg's clock is three hours off.  I published the last at about 10:29, but it registered at 7:29.  Or maybe Google is having an off day.

Regards  —  Cliff