Comments on: The Politics of Entrepreneurship

By: Russell Buckley

Russell Buckley — Mon, 07 Apr 2008 20:26:11 +0000

Thanks for the comments!

@Tommie – yes certainly a fan of Taleb, though not sure about Carlo! But your suggestion does sound like the basis of an interesting academic study! There’s not been a lot of work in this area that I know about.

@Sean and Anthony. I think there are actually many reasons why second time entrepreneurs are apparently rare. Though I did ask Fred Wilson (the epinonymous VC) for his take on this and he posted a response on Dave Winer’s original post – apparently couldn’t make comments work here. He said that 10 out of 17 companies in his portfolio had achieved success before and cited as “ego” being the driving force second time around.

For me, entrepreneurship is really, really hard and you know exactly how hard the second time around, which probably puts many off. Personally, if I had the choice, I’d burn my entrepreneurial needs on being an angel investor and advisor. And let some other poor bugger work all hours and have the sleepless nights.

I suspect that this is the route taken by most successful entrepreneurs who have managed a highly profitable exit.

Russell

By: Tommi Vilkamo

Tommi Vilkamo — Mon, 07 Apr 2008 19:46:54 +0000

Good thinking Russell. I would want to add to that the “Fooled by Randomness” factor*. That is, you should compare the success rate of all second-time entrepreneurs against the success rate of all first-time entrepreneurs. Could it be that a great deal of first-time successful entrepreneurs can be explained by them being mostly lucky (but hard-working) fools of randomness**?

* = did I remember correctly that you and Carlo were fans of Nassim Nicholas Taleb too?
** = as defined by NNT, not the commonly understood definition

By: Anthony Kuhn

Anthony Kuhn — Mon, 07 Apr 2008 19:02:04 +0000

Russell: I have to agree with Sean in his assertion that there are many different skill sets involved with bringing a startup to life or running a growth business, and that might be the rub. I especially like the part about athletes being good athletes but maybe not good coaches (or sportscasters, for that matter!) I don’t think most people, or entrepreneurs, have it in them to always be striving, straining, gaining, and stressed. When someone succeeds in business it is because they did all those things. And naturally, they want to take a bit of a break from those things and enjoy the fruits of their labor.

By: sean

sean — Sun, 06 Apr 2008 19:01:06 +0000

Hi Russ,

I think it’s not about “expect success” as we all have some expectation of success when we start our first venture (or we wouldn’t get started at all). It’s that hope for success that lets us push through the threat of failure.

I think the biggest factor is whether a successful entrepreneur retains the skills that allowed them to get their venture started in the first place. In technology startups, the key at the beginning is product and technical expertise. If you are successful, you need to develop skills like sales and investor relations as these become your primary job. Most entrepreneurs get sucked into this latter category and lose touch with (or lose interest in) the original skill set that allowed them to get started.

In this case, they have to approach their future startups in a completely different way than they approached the first startup. A former engineer might need to raise money up front and hire some engineers instead of bootstrapping and writing the code themselves – changing their strategy completely. This greatly reduces their chances of success by preventing them from building upon everything they learned about starting a company the first time around. It’s the same reason few athletes make great coaches.

Sean