By LAURA LOREK
Founder of Silicon Hills News
Illustration courtesy of Disciplined Entrepreneurship
That’s the key message from Bill Aulet, managing director of the Martin Trust Center for MIT Entrepreneurship and a serial entrepreneur.
And he aims to teach as many people as possible.
Today, 20 percent of young people want to start their own company, but it’s not possible to scale entrepreneurship education, Aulet said.
“When you teach entrepreneurship you have to do it,” he said. “It’s experiential. It’s mentor intensive and the mentoring requires a lot of effort.”
Aulet spoke Tuesday morning to a group of entrepreneurs at Capital Factory, a technology co-working site, accelerator and incubator in downtown Austin.
Historically, business schools have focused almost exclusively on meeting the needs of large companies, Aulet said. And while lots of books have been written on different aspects of founding a company, Aulet found a need existed to craft a handbook, or how to manual, for startup entrepreneurs.
So Aulet created a toolbox and a common language to share knowledge in his book: “Disciplined Entrepreneurship: 24 Steps to a Successful Startup.” The just released book provides a roadmap with key steps founders should take to become more successful in their ventures.
Right now, entrepreneurship is so ill defined, Aulet said.
“It’s easy to fake,” he said.
He fears that stories and myths generate a spirit of entrepreneurship without providing the necessary skills.That’s why education is so essential, Aulet said. He predicts every school in the country will be teaching entrepreneurship.
In his book, Aulet dispels three common myths including the focus on the lone entrepreneurs. It’s often teams that found companies and the more founders the greater chance of success, according to Aulet. He also dispels the myth that all founders are charismatic and that is a key to their success. That only goes so far. The most important traits to success are the ability to communicate, hire good people and sell the product and company. And lastly, people are not born entrepreneurs. They are taught to be entrepreneurs.
“What the book is not – it’s not everything you need for startups,” Aulet said. But it’s a start.
The reason he named his book Disciplined Entrepreneurship is to make it clear that successful entrepreneurs have incredible self-discipline. Often stories told about them make it look easy and effortless.
“We have not defined a discipline of entrepreneurship,” Aulet said. As a result, he fears a backlash against entrepreneurship that the country can ill afford.
That’s because entrepreneurs create jobs. The Kauffman Foundation analyzed 2007 Census data and found that “young firms, those one to five years old, accounted for roughly two-thirds of job creation, averaging nearly four new jobs per firm per year. Of the overall 12 million new jobs added in 2007, young firms were responsible for the creation of nearly 8 million of those jobs.”
“The jobs are not being created by Chrysler or by Microsoft, the jobs are being created by you,” Aulet said. “It’s not a direct path. It’s like a game of Chutes and Ladders. It winds.”
The first step in starting a company involves defining “who is your customer,” Aulet said. That involves creating a customer persona. He used an example of a Lamborghini owner as a high net worth middle-aged man who enjoys the finer things in life and wants the finest customer service. A repair shop catering to that customer would not service Volvos or Hondas. It’s all about catering to the Lamborghini customer.
“The best place to start is with a customer…great startup companies become one with the customer,” Aulet said.
It’s really important to define that market because if your product is for everyone, it really isn’t for anyone, Aulet said.
“If you want to be a great company you find a targeted group,” he said.
Next comes spiraling innovation. Aulet includes an illustration in his book of the 24 steps that looks like a game board.
“This is kind of the dirty stuff,” he said. “It’s not sexy but it’s essential. How does the customer acquire your product?”
Entrepreneurs must map the process to acquire a paying customer.
They always underestimate this cost, Aulet said.
Next, how do you make money off your product?
“The number one job of a CEO is to make sure you don’t run out of cash,” Aulet said.
The final stages of Aulet’s book deal with designing and building the product and scaling the business.
In brief remarks after his presentation, Aulet said that business accelerators are better than incubators for launching new companies. Accelerators tend to launch successes or failures, but either way it’s a quick process. Incubators can maintain companies for longer periods of time in a comfort zone, often giving them a false sense of accomplishment. Aulet referred to those companies as the living dead.
Video from Aulet’s Disciplined Entrepreneurship Blog:
