Must Learn Concepts for Entrepreneurs from Business Books
July 13, 2008 · Print This Article
A post on TheFunded.com caught my attention today with the subject of Must Read Books For Entrepreneurs. It recommended the story of startup execs building their companies Founders At Work (and then adamantly disclaimed no association with the authors which I found a bit forced). The post got me thinking about business book in general.
In launching iContact in 2002-2003 while also running Preation I spent very little time reading books about entrepreneurship and growing businesses, I stayed heads-down delivering software and trying to educate the market about our offerings. It wasn’t until 2005 when I began traveling for business about twice a month that I began to force myself to read again, it had been since my childhood that I had read anything not directly related to formal education. I even had a lot of fun ridiculing two of my good friends from college when they formed a book club among their girlfriends and acquaintances.
As my need to fly coast-to-coast and to Europe increased a bit I suddenly had a great deal of time on my hands sans-broadband but wasn’t about to allow myself to sit idly. Shortly before a trip to San Francisco (typically 5 hours in the air each way over two flights connecting in Dallas) I picked up Jim Collins’ book about out-performing organizations Good to Great from a large stack prominently displayed in Barnes & Noble at nearby Southpoint Mall. This kicked off a business book reading spree and began my so far three-year streak of boring my wife to tears with the neat little anecdotes I pick up from a variety of topics: start-ups, web 2.0 technology, management strategy, performance teams, marketing, branding, organization and operations, focus, communication, and task execution.
As an entrepreneur you literally cannot find a book in the popular business categories that doesn’t apply to some part of your realm of responsibility, unfortunately you can’t read them all. Maybe there’s a book that can help you better plan which books you should read… but I guess it would be unfairly biased if it concluded that you should read it first. I think I once saw a book about how to best retain information from books that you read, I need to look for this one again, it’s certainly a challenge mentally bookmarking all of the tips you pick up along the way. Actually bookmarking them would be futile. Also, some books have one or two great ideas but spend the rest of the 200-300 pages hoping to prove the intelligence/authority of the author or the premise of those good frameworks. This is where asking around before you begin a book may save you a lot of time. Nearly every good business book today suffers this ailment, probably a symptom more of the publishing world’s expectation of the length of a paperback hit than a failing of the author to communicate properly (whether done consciously or not).
So, in hoping to pass along a road map for the juicy nuggets in two of my favorite business books I responded back with the following (revised slightly for this venue):
I suggest Crossing the Chasm by Geoffrey Moore (http://www.amazon.com/Crossing-Chasm-Geoffrey-Moore/dp/0060517123) and Good to Great by Jim Collins (http://www.jimcollins.com/). The concepts in both are useful in building strategy that the Venture Capitalists like, ie: working to focus your efforts and attack your most likely prospects.
We used the concepts in these two books to revise our view of the market slide in our funding deck and immediately saw a great response from VCs. You should at least be familiar with these books and their high level recommendations. You don’t necessarily need to read the two books, just make sure you’re familiar with the concepts as follows (you can cherry-pick the right chapters if you look carefully):
Crossing the Chasm:
Beachhead
The Adoption Curve
What the chasm is and how you attack it
Good to Great:
The Flywheel Metaphor
The Hedgehog Concept
The School Bus Metephor (right people on the bus, right people in the right seats, then steer the bus in the right direction)
There you go, master these concepts and you’ll have a startup MBA in the eyes of the VCs. Good luck.
Those books appear great for those already engaged, I’m I right on that? What do like for those that have yet to commit to an entrepreneurship event? Nearly all that I work with don’t know enough about it to understand the concept or how to proceed to step one.
I think of information as stacked like a pyramid by degrees of stored intelligence, the top level being brains, then book shelves, then the Net’s hard drives. When needing to work most efficiently under pressure, a top down strategy works best, and if the brains available are good enough, there can be little need to seek the depths of the other layers of information in getting things underway. Eventually though, complexity grows and all layers grow in value.
For a first time entrepreneur I would recommend a book you actually gave to me years ago, my first business book and the first text I ever read that mentioned the concept of entrepreneurship: “The eMyth” (now with the extended title “The eMyth Revisted” for the second edition).
As a disclaimer, I’ve actually never read the entire book, I have read the first half of the book where Michael Gerber talks about the challenges of a first time entrepreneur but I’ve never read the second half about the solutions. This is no fault of Gerber or his book but has more to do with the length of flights I was taking around the time I started to dive in.
From what I have now read three times in the first half of the book and what I know about the second half of the book from many discussions about the it with other entrepreneurs I do believe that he’s right on. In my own businesses I’ve experienced many of the challenges he describes and the solutions he outlines regarding process and measurement and standards are absolutely critical to starting and growing a business from an idea into an operation.
Although, this book is more applicable to businesses that plan to hire skilled employees sooner rather than later. A web app company that might run with their founder team only for a long time wouldn’t necessarily need the wisdoms of this book as much until they got to an expansion stage and began hiring a team underneath them.
For companies that will spend most of their time in the early days dealing with how and when to bring a new product to market and how to tailor it to a receptive audience (especially a disruptive technology that will require people to change the way they currently do things in order to use it) I still strongly recommend “Crossing the Chasm.” I have read this book in its entirety and other than being a bit too in-depth and long winded at times it has a great point that’s important to understand.
This book does get a bit intellectual in parts but the ideas are relevant to crafting ideas into products and services for which real addressable markets exist now. Doing this right will probably mean more revenue sooner and a greater chance at nailing a widespread expansion further down the road.
Michael Gerber did his last update to eMyth Revisited, 3rd edition in 1994. In gathering that little factoid from Amazon.com I see that he has a new one out in hard cover as of last month, June 2008, , Awakening the Entrepreneur Within: How Ordinary People Can Create Extraordinary Companies. First two posted reviews clobbered it. Great title, but apparently doesn’t deliver. Looks like the market is still open for someone during some current thinking on this topic.
Looks like you can summarize the read of his latest book at his blog site in a few paragraphs.
http://awakeningtheentrepreneur.com/blog/
Gets back to your comment about the inflated nature of promoting a “good idea”. There is a very skinny little volume on writing called Elements of Style, an author who understood the thinking about saying what needs to be said and no more.