Conclusion

In building a great institution, there is no single defining action, no grand program, no one killer innovation, no solitary lucky break, no miracle moment. Rather, our research showed that it feels like turning a giant, heavy flywheel. Pushing with great effort—days, weeks, and months of work, with almost imperceptible progress—you finally get the flywheel to inch forward. But you don’t stop. You keep pushing, and with persistent effort, you eventually get the flywheel to complete one turn. You don’t stop. You keep pushing, in an intelligent and consistent direction, and the flywheel moves a bit faster. You keep pushing, and you get two turns … then four … then eight … the flywheel builds momentum … sixteen … you keep pushing … thirty-two … it builds more momentum … a hundred … moving faster with each turn … a thousand … ten thousand … a hundred thousand. Then, at some point—breakthrough! Each turn builds upon previous work, compounding your investment of effort. The flywheel flies forward with almost unstoppable momentum. This is how you build greatness.1

—Jim Collins

WHAT I KNOW NOW THAT I WISH I KNEW THEN

David M. Mott, NEA and MedImmune

David M. Mott is a general partner at the venture capital partnership NEA, which is focused on biopharmaceutical investments. Over 16 years with MedImmune, Inc., he served in roles of increasing responsibility, including chief operating officer, chief financial officer, president, and chief executive officer, as the company grew from a venture-backed start-up (founded in 1988) into one of the top five biotechnology companies in the world. Ultimately, he initiated and executed the sale of MedImmune to AstraZeneca in June 2007 for $15.6 billion. At the time of his departure in July 2008, MedImmune had annual revenues in excess of $1.5 billion, an annual R&D budget in excess of $650 million, and approximately 3,000 employees. David shares these lessons learned from a roller-coaster ride from $50 million market value to $900 million, back to $50 million, and ultimately an exit of over $15 billion on a total investment of only $308 million:

Shortcuts aren’t.

The failures you survive make you stronger.

Know the difference between the tenacity needed for success and blindly staying with a deal that can’t win big.

Doing more than a few things at a time is hard.

Unproductive times follow success; productive times follow setbacks.

Good deals get done from strength; bad deals are done in fear.

Your most expensive financing will be the one you didn’t do.

Make sure your partners’ interests are aligned with your own.

Continuity of management and board matters a lot.

Always maintain a consistent commitment to culture, shared values, and an ethic for how to treat each other; they are the foundation of a shortened decision process when you most need it.

You always want all your people to think like owners, not employees.

Success can make you afraid to take chances and reinvest. Never lose your taste for measured risk.

Entrepreneurship is hard, but it offers tremendous opportunities for personal growth and learning.

Teamwork and relationships are critical to success.

Do something you think is very important. Otherwise, there are easier ways to make good money.

The destination is irrelevant; even the most successful ending is disappointing and anticlimactic. It’s about the journey; about building something big, valuable, and important; and about doing it with people you respect and enjoy.

If you’ve reached this point, we hope this book has been useful. We started this story with some careful definitions, then helped you think about objectives, worked through your primary entrepreneurship tool kit, discussed how to avoid pitfalls in your launch, and offered some thoughts about operating effectively and moving from a start-up to a going concern.

There is a world of materials out there to help founders on every step of their journey, yet many entrepreneurs we meet complain that they are starved for wisdom and guidance even as they are drowning in information and input. Our purpose in writing this book was to act as a gateway for you to the mountain of resources available to entrepreneurs. It’s so much information that accessing it often requires first that you know what you need and why it’s important to you, where to look, and how to ask for it.

However, you can’t find the best information on starting a new venture in books or articles; you must find it in your customers and the people who already have gone out and done something like it. One of the most common ah-hah moments we see in our students happens when they realize that the best entrepreneurial education comes from picking up the phone or going to see someone and asking the right questions. We hope this book has helped you learn to ask the right questions and impressed on you how important it is to go and ask.

We know that every deal, every situation, is just a mess of incomplete and incoherent information. Entrepreneurs start to add value when they begin to frame the necessary questions, extract the right answers from the messy data, and use good judgment in applying those answers to executing in an uncertain world. We know you can do this. Just remember the following steps.

FIRST

Entrepreneurship means getting things done with resources you don’t control. It’s about being entrepreneurial: learning and developing characteristics, not just starting things or being a certain type of person.

The implication. Being entrepreneurial is not all or nothing; you can learn to be entrepreneurial and apply the knowledge and skills almost anywhere. Don’t focus on controlling resources. Focus on getting things done.

SECOND

Ideas create opportunities. Execution creates value. “Many innovative thinkers never get anything done”2

The implication. Don’t just stand there—do something. Eliminate risks and kill ideas early. Trust natural selection; develop multiple alternatives, turn them loose in the market, and let only the fittest survive.

The secret of success is to do the common things uncommonly well.

—John D. Rockefeller

THIRD

A learning curve trumps an earning curve. Be patient about learning versus going for the big money too early. The more you focus on learning now, the bigger your success will be later. Always remember that the probability of success is proportional to the learning.

The implication. Focus on learning; earning will follow. Where can you learn? Everywhere. Remember: Failed deals are great starter kits. It’s a shame to learn on a good idea. Everyone can teach you something. Experience and mistakes are the greatest teachers.

The reasonable man adapts himself to the world: the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.

—George Bernard Shaw

There’s nothing reasonable about entrepreneurship!

WHAT I KNOW NO THAT I WISH I HAD KNOWN THEN

David Hendren, Innovative Health Ventures and True North Advisors Group

Experience in multiple entrepreneurial roles has given David Hendren perspective from virtually every side of the table: as an entrepreneur, active investor, board member, and advisor. He has advised, incubated, launched, financed, and exited from a variety of technology companies as a law partner, venture partnership founder, and business advisory consultant. Seeing profound changes in the environment for new ventures and emerging businesses, David recently launched Innovative Health Ventures and joined the investment and business advisory firm True North Advisors Group to advance innovative business models for new enterprise creation, financing, partnering, mergers and acquisitions, and commercialization of novel technologies. Years ago, David learned a poignant lesson in business and life from an unlikely teacher:

Before my freshman year at Dartmouth I decided to take a year’s detour from my life of social and academic privilege. I drove out of Boston in an old Ford and hired on as a roughneck on an oil rig in South Texas.

I often think back to my first day on the rig. In order to look less boyish I grew a scruffy beard. I learned the importance of caution and not making the same mistake twice. I still remember the fear the first time I threw the spinning chain after watching one of my crewmates lose the use of his arm to it. Fear was what kept you alive on the rigs. I always knew I’d return to a world where safety and financial security are taken for granted. But the guys I worked with would always live with fear, just as they had helped me learn to do.

I often look back on those times and a wise soul named Bill. On our five-man crew Bill was the “motorman” responsible for maintaining machinery. Bill had held every position on a rig crew, from roughneck to the driller who runs the rig. He had seen the world and spoke of everything from “fighting Uncle Sam’s war in Europe” to driving long-haul trucks out of the Rio Grande Valley.

At the end of a hard day’s work just before I left for college, Bill and I stood relaxing beneath the derrick, exhausted and covered with drilling mud, watching cattle stroll by on the way to pasture. It’s unheard of to give advance notice of quitting in the oil field, but I didn’t want the crew to resent me for jumping to another rig. But it’s even more unheard of to quit and go to an Ivy League college.

Bill asked what college I would attend.

I replied, “It’s just a little school in New Hampshire. You never would have heard of it.”

Bill persisted. “Try me, boy.”

“Dartmouth.”

For a moment, I didn’t know whether to expect a pat on the back or a punch in the face for being an impostor, slumming as a tourist in their very different lives.

Bill smiled and said, “Why, I always knew you were smart. You just didn’t want anybody to know.”

Then he told me he had been offered an athletic scholarship at LSU but failed to take advantage of it. “I thought I was too smart for that,” he said.

Then he listed jobs he had taken over the years. His self-criticism was caustic and unforgiving. I’ll never forget his conclusion: “You’re a good hand, Dave. You worked hard here and never made the same mistake twice. Don’t make the mistake I made. Get your education. Be a doctor, a lawyer, a teacher, an engineer. Do something important, something that makes you happy. Don’t end up an old roughneck like me.”

I wish I could say that in the three decades since that moment I hadn’t made any mistakes, but it wouldn’t be true. I did follow Bill’s advice and got lots of education. I’ve been lucky to know and work with many talented people on any number of entrepreneurial ventures.

I’ve learned that lasting personal and entrepreneurial successes come from how well we see reality, how well we actually act on what we see, and how we deal with the inevitable obstacles life offers. The most important thing may be learning from our own experiences and the wisdom of others.

Life will never be perfect. It will always have surprises. But we can make the best of it if we keep an open mind, if we are honest with ourselves, and if we have the faith and courage to admit mistakes, start new ventures, change career paths if we’re unhappy, or even shut down a venture that’s not working and move on to start another. It’s sobering and humbling to remember how many people we can learn from—some, like my friend Bill, who could have been where we are, or even be our boss if perhaps they had chosen differently. Listen to them! And especially listen to your own inner voice that often really knows best where you need to go.