Tag Archives: unsuccessful

Derek Lidow’s Terrific New Book on Entrepreneurship

Derek Lidow’s book, Building on Bedrock: What Sam Walton, Walt Disney, and Other Great Self-Made Entrepreneurs Can Teach Us About Building Valuable Companies, is a welcome corrective to the overhyped promotion these days of high capitalization, high-technology, and high-risk businesses. Bedazzled by the wild hype surrounding gazelles and unicorns, entrepreneurship researchers have continued to focus on the black swans, even though the total IPOs in any given year would fit comfortably into a large lecture hall, as on average just over 100 U.S. firms went public annually between 2001 and 2016. The number of new ventures receiving venture capital funding annually in the United States has not changed appreciably in the last 20 years, hovering around 1400 per year. Nonetheless, business books and prominent entrepreneurs continue whipping up enthusiasm, encouraging entrepreneurs to take big risks in anticipation of big gains.

Robert Davidson sculpture

Meeting at the Centre, by Robert Davidson

In contrast, Derek Lidow points to “bedrock entrepreneurs” as the true foundation of economic prosperity in the United States. Every year, hundreds of thousands of ordinary businesses are started in the United States, many by people who have no idea what they are doing and who are not prepared for the challenges they will face. Martin Ruef and I wrote about these “mundane entrepreneurs” in our book, Organizations Evolving, and Paul Reynolds has diligently documented their existence through large scale representative samples of business starts. Lidow offers sage advice to would-be entrepreneurs, suggesting that many of them would be better off taking wage and salary jobs. But, for those who are willing to prepare themselves for the challenges, he recommends going for it.

But, “going for it” does not mean in the reckless way encouraged by entrepreneurial self-help books, but rather in a mindful, reflexive, and experimental way. He shows that successful entrepreneurs are not differentiated from the rest of us by any inherent talents, but rather by their willingness to learn from their experiences. He recommends that entrepreneurs continue experimenting until they either get it right or realize that the venture they’ve planned will not work.

This is a delightful book, written by somebody who has had a productive career running a family business, starting his own business, being CEO of a listed company, and then transitioning to a university position. He has the life experiences and educational training, including a PhD in applied physics from Stanford, to offer valuable advice. He readily admits his mistakes and is humble about his successes.

I highly recommend this book to anyone who’s contemplating entrepreneurship and to anyone who is consulting, teaching, or otherwise involved in the entrepreneurial community.


What Sustains a Belief in Success Among the Unsuccessful?

I’ve been haunted by the question of what sustains belief in success among the unsuccessful ever since I read Reinhard Bendix’ magisterial book, Work and Authority in Industry. Bendix wrote about the economic ideology that kept millions of people in England, the United States, and other Western capitalist societies working in arduous and poorly paying jobs, apparently in the belief that someday, sooner or later, their hard work would be rewarded. Bendix’s view was that this ideology enabled developing capitalist societies to survive in spite of the hardships experienced by their working classes and the demonstrable economic inequality produced by economic growth.

A similar question occurred to me a few days ago after I finished a fruitless 6 hours of fly fishing at a local Lake. Along with the other members of my small fishing group, I had spent the day in bitterly cold weather, casting into a howling wind, with almost nothing to show for it by way of trout landed. This was not an atypical day, except for the cold, as we often spend an entire day fly fishing without catching more than a handful of fish. Nonetheless, every week, on our appointed day, we trek back to the lake and try it again.

Afternoon sun on the Duchesne

Afternoon sun on the Duchesne

On the way home from the lake, I found myself thinking about the similarities between my fly fishing experience and that of underemployed members of the creative professions that I’ve been studying. Actors, musicians, authors, dancers, filmmakers and others often spend years without finding steady employment in their profession, sustaining themselves by working in other jobs that may have little or no connection to their professional identity. For example, at the beginning of 2012 report by Actor’s Equity Association said that the average unemployment rate for actors was around 90%.

One of my friends asked if I would accept an analogy between the experience of athletes, who often experience “failures” through losses in competition and infrequently-employed creative artistic professionals. I said no, because the context for athletic failures is quite different. Athletes, whether amateur or professional, are competing within a context where there are rules that govern their actions: there is little uncertainty about the need to experience failure. Every athletic contest has a winner and a loser, determined by rules that were set a priori. The very nature of athletic competition mandates that someone will lose in every game.

By contrast, fly fishermen and creative professionals are operating in a highly uncertain context. There are well-established and standardized procedures for acquiring the skills needed to potentially do well as an angler or artist, but for any given performance, whether it will be a “success” or “failure” is highly uncertain.

Additionally, many products produced by creative professionals either fail to get distributed or lose money when they are distributed. Paul Hirsch pointed to the overproduction of many cultural products, such as films, records and CDs, books, and plays, resulting in a large number never reaching their intended audiences. American playwrights, for example, consider themselves fortunate if their new plays are produced for a 2nd or 3rd time, after their premier. Many are produced once and never appear in a theater again.

So, in the face of such long odds, what sustains a belief in success among these unsuccessful creative professionals? As I drove home, I pondered the similarities between these artists and fly fishermen. Admittedly, initially it seemed a bit of a stretch, but then several principles came to mind. 1st, as we know from behavioral psychology, intermittent reinforcement is a very powerful force in sustaining a behavior. Indeed, intermittent reinforcement – – receiving reinforcement on an unpredictable schedule – – is more powerful than receiving reinforcement consistently after every trial. For anglers, all it takes is a few successful catches in a day to create the feeling that the day has been a success. Perhaps for artists, the same thing holds?

2nd, and probably more important, anglers, especially fly fishermen, are often part of a very resilient community that gives them a very strong sense of shared fate with other anglers. Fly fishermen have magazines, blogs, videos, television programs, voluntary associations, and other mechanisms that enable communication with others who share a passion in fly fishing. I believe the same is true of the creative professions. Having a strong sense of social identity, in which someone perceives their identity as tied to that of a larger community of like-minded people, could sustain a person through difficult times.

3rd, if someone has experienced powerful socialization pressures such that their personal identity is bound up with their occupational identity, they may tolerate an enormous amount of misery before abandoning that identity. Thus, someone who strongly identifies with their artistic craft may continue to hold onto that belief, regardless of having few opportunities to demonstrate their prowess. Lena and Lindemann used data from a very large survey of individuals who had pursued an arts degree in the United States to investigate the question of artistic identity, noting that many workers are defined themselves as artists did not hold artistic jobs. They focused on the very large group that said they had worked in an occupation associated with the arts but who did not indicate that they identified as a professional artist. However, what caught my eye in the survey was a much smaller number of people who said they either currently or at one time had worked as a professional artist but then indicated in another question that they had never worked in an occupation associated with the arts. This small group of people apparently had sustained a sense of being an artistic professional while never having an opportunity to work in an occupation associated with the arts.

I would love to know more about these “artists” – – were they able to publish, record, perform, or otherwise display their talents just often enough to maintain a belief that someday they would “make it big”? Were they member of local communities of creative professionals who reinforce one another’s beliefs that they were just going through a temporary bad patch and success was just around the corner?