Do you have what it takes to be an entrepreneur? Do you think you need a Harvard MBA to build an 40 million dollar business? Bill Murphy Jr. takes a deep dive into three Harvard MBA entrepreneurs to answer this questions and comes out with 10 rules for entrepreneurship in The Intelligent Entrepreneur: How Three Harvard Business School Graduates Learned the 10 Rules of Successful Entrepreneurship.
The Intelligent Entrepreneur: The Characters
Murphy’s Intelligent Entrepreneur follows three entrepreneur’s throughout their careers. Each story starts with what each was doing before Harvard Business School. He walks you through their decision to go to Harvard, their time and struggles at Harvard. None of the three necessarily wanted to start their own company nor had an idea when they graduated. Each went their own way, but before long, the entrepreneurial bug bit them during the dot com boom. The characters are Marla Malcolm of Blue Mercury, Chris Michel of Affinity Labs and Military.com, and Marc Cendella of The Ladders. Each has their own style and experienced their own struggles that are detailed in the book. Those different styles and struggles produced enough similarities for Murphy to build his 10 rules for entrepreneurs.
10 Rules for Intelligent Entrepreneurs
- Make the commitment – Each founder had their own daemons to conquer before they could take the leap into their start-up. In the end, each had to go “all in” before they could get their start-up off the ground. Unfortunately my wife said I could not quit my job to focus on this blog full time :-). Marla Malcolm, for example, had to leave the the safety of working for her mentor to start Blue Mercury.
- Find a problem, then solve it – Which comes first, the chicken or the egg? In a start-up, the the problem needs to come first. You can have the greatest product int he world, but if it does not solve a real problem, then it will quickly fizzle. The best problems for founders to solve are personal ones. Chris Michel started up Military.com because had first hand experience in the confusing world of the overly bureaucratic military red tape that was next to impossible to navigate.
- Think Big, Think New, Think Again – Small ideas make small money. Big ideas make big money. Because each of the three founders started their companies at the tail end of the dot com boom, their ideas were multi-billion dollar ideas. However, every founder will tell you that their first idea is never the final product. The Ladders thought big (taking on Monster and Hot Jobs), thought new (charge job seekers and not the job posters) and then thought again (changed their business model to start charging job posters). This is also the central idea of one of my favorite books, The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses by Eric Ries. In any business, like in your financial life, you need to pivot.
- You can’t do it alone – Every start-up needs a team and your partners need to compliment you. Marla Malcolm had Barry Beck. Marla was the vision and Barry was the guy that executed the plan. Without Barry, Marla would have had many ideas but ended up with a crushed spirit because she would have been bogged down with all the details of executing her vision.
- You must do it alone – Being a founder or CEO is a very lonely job. There are few people, not even your spouse, that you can share everything with. In all three cases, the founders had to cut staff and change business models. Military.com had to cut their staff down to a bare minimum just to survive.
- Manage risk – Many people think that entrepreneur’s are risk takers, but that is a fallacy. Entrepreneurs are risk managers. Marla Malcom was one of the best in this book. After Harvard Business schools she had a nice consulting job to which she could return. But she wanted go go work for someone else. She got a promise from the consulting firm that she could return if her other job did not work out. She later lined up the funding for Blue Mercury before quitting her job. When the internet bubble started to burst, she went the direction of brick and mortar stores. Every step of the way, she reduced her risk.
- Learn to lead – As a founder, you are looked up to by all of your employees. You are the person taking the risk with their livelihoods and they want you to lead them. Sometimes your leadership and vision waiver, but as the leader, you need to rise above and show everyone the lighthouse on that dark stormy night. Marc Cendella of The Ladders showed true leadership when The Ladders needed to pivot and start charging employers to post their jobs. His team thought this was impossible. Marc pointed out to the team that they had already made a huge pivot like this before in the company’s history when they went from a free service for employees to a paid service. Sometimes leadership is helping us see the past so we can envision the future.
- Learn to sell – Selling is the only curriculum not offered at Harvard Business School. However, every entrepreneur will tell you that you need to learn to sell. You have to sell the company to investors and new employees. You need to sell your products and services to clients, and you need to sell your vision to your employees.
- Persist, persevere, and prevail – Starting a business is tough. If it was easy, everyone would do it. To be successful, oftentimes you just need to last longer than anyone else. There were many times that Chris Michel wanted to throw in the towel at Military.com. After he first had his idea and started looking for funding, he found out that he faced huge competition from entrenched traditional media players and well-known figures such as Ross Perot. The internet bubble burst and Military.com lost many of their advertisers and one of their investors converted their shares into a loan and called the loan. Each time, Chris, with much help from his team, kept at it. They ate the elephant one bite at a time.
- Play the game for life – Starting a company is not a job, it is a way of life. Each of the founders are still in the game today.Every founder gave up much in their life to pursue their dreams of being an entrepreneur. According to a Forbes article, entrepreneurs have the highest divorce rates among any profession.
Who is The Intelligent Entrepreneur for?
Do you want to start your own company? Is something holding you back? If so, this book is for you. You will not receive step-by-step instructions on how to start a business. You will get many nuggets of wisdom encompassed in the 10 rules above that will help you along the way. This book is also a great Excitement Book. Reading it will help you get excited about entrepreneurship and help you think – I can do that.
Should I Read The Intelligent Entrepreneur
I give the Intelligent Entrepreneur 4 Stars. Bill Murphy is a great historian and story teller, but I did not mark up the book like a college text book. If you are looking for your first book on Entrepreneurship, keep looking. However, if you are an avid reader and are thinking about starting your own business one day, then this book is for you. I would also recommend this book if your business is stuck or has hit a plateau. While you are not going to get your answer to your problems from this book, you will be inspired and exposed to many problems that these founders faced. This exposure will likely help you see your problem in a new enough light to spark an idea.
What is your favorite book on Entrepreneurship? Tell us in the comments below.
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