Posts Tagged ‘Entrepreneurship’
Sam Morgan says: “Stop talking about entrepreneurship and just go build businesses”
There’s a fair amount of back slapping that goes on about how entrepreneurial we are as a country. Basically it’s crap.
Too much of our entrepreneurship does little to increase our overall economic wealth, but all the same it can be pretty sh!t hot – speaking personally here.
Mostly Kiwi entrepreneurship is small time, unambitious, lifestyle focused etc which you know, at a personal level, is okay.
For the economy, not so much.
As Trade me founder Sam Morgan says: “Stop talking about entrepreneurship and just go build businesses.”
Morgan is the NZ patron of Global Entrepreneurship Week which runs from November 15-21.
“The Week will bring together millions of young people across the globe through online and local activities and encourage them to think innovatively and unleash their ideas. Through a coordinated effort with many different countries, during one week every year, the world will celebrate the entrepreneurial spirit in hopes of inspiring a new generation of young entrepreneurs.”
So not sure Morgan’s quote is on message, but from a NZ perspective it’s bang on.
I’ve posted before on the disjunction between our high levels of inventiveness and entrepreneurial drive and our relatively poor overall economic growth performance. Possible culprits include:
- Lifestyle coming ahead of building the business
- Our inability to distinguish between the way we think the world is and the way it really is
- Too much DIY
- Undervaluing intellectual assets
Gordon Gekko naive – how to get back trust in business
I think there’s pretty much broad agreement that business has lost society’s trust, though that trust probably hasn’t taken such a big hit in New Zealand as say in the US.
Author and consultant Charles H Green points out in an article in BusinessWeek that this loss of business’ legitimacy is a shame, not just for business but for society at large.
I’ve posted before on one aspect of this – how the Government’s efforts to tilt the playing field in favour of business to boost economic growth is a bad piece of timing, coming as it does when trust in business is at a low ebb.
Green writes there is no such thing as a legitimacy index - “…any attempt at mapping something as ephemeral as legitimacy will be fraught with subjectivity”.
But he suggests legitimacy broadly tracks social phenomena such as trust and confidence, heroes vs. villains, and the popularity of going into business as a career choice. “By these indicia, the socially perceived legitimacy of business was low in the 1960s, high in the ’80s, and is at a nadir now.”
Green points to a couple of drivers of the ups and downs:
• “In the ’80s, there was a common viewpoint about business’ relationship to society. Milton Friedman spoke the economists’ version—companies owed no social debt beyond being profitable.”
• “[Michael] Porter’s major impact was describing business itself as an ongoing Hobbesian state of competition—not just between competitors, but between companies and their customers, suppliers, and social institutions. Corporate success is defined as gaining sustainable competitive advantage over all one’s competitors. Adversarial relationships in Porter’s worldview are simply the Way Things Are.”
• “One of Goldman Sachs’ defenses in its current litigation is caveat emptor.”
“These messages all converged. Business was the source of its own legitimacy. It needed no external endorsement. It would work best when left alone, allowing Darwinian forces to work their magic.”
Funnily enough Porter’s and Friedman’s ideas seen naïve now, post the Global Financial Crisis. (I like the idea of Gordon Gekko being naïve).
How do businesses get their legitimacy back?
Green says they need to recognise that social legitimacy comes from finding a role in society — “not from complaining about society’s intrusions, albeit in the form of government”.
“Business legitimacy won’t be regained as long as it remains all about competing successfully with other stakeholders rather than collaborating with them.
“And business is being rudely reminded that legitimacy derives from society, which occasionally makes its will known via the political system. The smart bet would be to collaborate, not compete.
“… legitimacy must come from within business itself, not from charity, corporate social responsibility — or community development. “
Hat tip – Stephen Lynch
Two Kiwi tech companies show the way, defying our entrepreneurship/successful commercialisation disjunction
The media during the last week or so have highlighted two bits of great Kiwi technology that are definitely not ‘me too’ products that clutter the world’s market places.
High hopes abound.
o PowerTread which turns the energy of vehicles passing over judder bars into electricity. The company behind the technology, Enervate – a couple of Auckland Westies – has hooked up to some Singaporean Government cash to help get its PowerTread system from prototype to commercial release. Enervate says one PowerTread unit could generate enough energy to supply power to up to three typical New Zealand homes.
o Rex, the Robotic Exoskeleton a pair of robotic legs that enables some wheel chair users to stand up, walk, move sideways, turn around, go up and down steps as well as walk on flat hard surfaces including ramps and slopes. Rex Bionics is finishing off tests needed to put Rex on the market in Europe and Australia. It will also seek FDA approval so that Rex can be put on the market in the US.
As far as BigCake knows there is nothing exactly like either of these products on world markets.
The big question is what happens next.
These guys look to be doing the right things:
o Getting outside investment (VC firm No8 Ventures has backed Rex Bionics)
o Bringing expertise on board (Enervate hooked up with AUT University’s Business Innovation Centre)
o Getting boards of directors
o Setting up international advisory boards (BTW – Rex Bionics’ one includes Frank Gardner, the BBC’s Security Correspondent who wrote one the all-time great journalism books Blood and Sand)
BigCake’s not sure how scalable these businesses are, but NZ’s track record for turning what looks to be world-beating technology into businesses that register on a national economic scale ain’t that great.
I’ve posted before on the lack of size of our high-tech companies compared with those of other smaller nations.
There’s a disjunction between our high levels of inventiveness and entrepreneurial drive, as shown by the above two companies, and our relatively poor overall economic growth performance.
A NZ Trade and Enterprise report identified the following management traits that may explain this:
o The struggle between creating more wealth and pursuing leisure tends to be won by leisure at a lower threshold of wealth creation in New Zealand than in most other countries.
o We tend to view the world from a distinctly Kiwi perspective and easily make the mistake of thinking for our customers. That results in us being judged as being quite different to how we think about ourselves.
o We are fiercely self reliant and reluctant to rely upon others for success. As a result we feel compelled to do things that we would be better off delegating to others.
o The Tall Poppy Syndrome which causes us to under-perform, to have a profound reluctance to give and receive feedback, and a similar reluctance to use specialists, preferring instead Jacks of all trades.
o We under value and struggle to recognise the intellectual assets that we create through our inventiveness.
So, yeah, judging by what Enervate and Rex Bionics have done to date, some Kiwi companies have moved on.
As an aside. When Campbell Live did a piece on Enervate the other week it played up the Kiwi inventiveness, No8 wire, DIY, mangled prototypes, overcoming the odds angle – all set in a West Auckland backyard.
This goes down well with the way we like to see ourselves, but it’s a crap picture for any international investor.
See my posts on the ‘slow sell nation’.