Based on a show of hands of the Like Minds audience, this room contains the highest ratio of entrepreneurship to business ownership John Rosling’s seen.
The defining qualities of entrepreneurs:
- Set the context – for the people in your organisation and your circles of partnership. Don’t get distracted by the content – you have to focus on the context of the problem, not the details of it. A company he worked with set the context of “freedom”, and they keep that idea in mind whenever they make a decision.
- Manage the energy – we’re all bundles of energy – getting all that energy moving in one direction is the definition of success. You need to be inspirational. If you’re not, your business can never grow bigger than what you currently manage.
- Coach, don’t play – you’re not on the field any more. You’re not midfield, feeding forwards. You’re on the touchline. A contact sends a blog post to all his staff every morning. He spends much of his time walking the floor of the business.
Rosling’s theory is that every business in the world understands how it does what it does. Quite a lot of businesses understand what they do – the passion and people and intellectual property that drive it. Very few understand “why”. Who does? Apple.
As an entrepreneur, you have to create the “why”. People won’t get excited by a plan. They will get excited by a dream. The person who understands “how” will always have a job, the person who understands “why” will be the boss.
The generation coming up have grown up in an age of abundance – of information and (for most) wealth. They want things to happen now. They’re not interested in hierarchy. They’ve also seen the cost of the growth – two parents working for a faceless corporate. They want freedom instead. They’ve seen the impact on the environment and the social fabric of the planet of the current model.
That’s the description of an entrepreneur. Over 50% of young people in the US have started a business or have a credible plan to do so. Large corporates are nervous about that. For us, as entrepreneurs, this is good news – structure your business to attract that talent.
What drives people
Dan Pink’s motivation. Autonomy, mastery and purpose are what drive people. If you don’t have a “why”, you won’t get talent.
Building great businesses sounds easy: know why, have a great vision and give people autonomy, mastery and purpose. Is that all we need to do? It’s better than that. What we get to create is wealth. You can drive profit. Valuation = profit x multiple. What the balance of time between profit and multiple?
To him, there’s no conflict between profit and sustainability – profit is an inherent element of sustainability. But if you chase profit, all you get is more profit, not more wealth – culturally or commercially. Each industry has a multiple that people value the business by based on its profit. If you’re in a 1.0 industry – get out. How do we build real wealth?
Culture and talent – we’re going to enter a period of sustained growth (his personal view). And you need to get your culture right to succeed. And we’ll have a talent shortage – and the right culture will attract talent. But then you drive that culture into product. Culture is now, innovation is tomorrow. You must understand what is unique about the business. Often the things that you believe in sit in the heart of that. Saga used to think that they were a travel company – but realised that they were a company that catered to people in old age.
A lot of what he’s talking about has nothing to do with money. We’re moving to a world beyond money. Talent will follow purpose, not money. Maybe we’re dealers in hope for the future.