Monthly Archives: April 2012

Can iphones drive?

It’s really amazing what you can do with a smartphone these days. Maybe smartphones will be smart enough to drive real cars one day. Now, that would be really cool!

http://www.twitvid.com/embed.php?guid=B6LFH&autoplay=0

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Should I attend business school or go work at a start-up?

I recently had the opportunity to talk to a smart, friendly guy who’s working at a well-known investment advisory firm. He wanted my advice on whether he should go to business school or take the risk of working for a start-up.

This person had recently been admitted to a top 10 business school in the Northeast. He’s already told his employer that he would be leaving this summer, but hasn’t made up his mind about what to do. Given his background, he eventually wants to work in venture capital and invest in start-ups. He felt that he was more of an investor than an operator.

Network vs Experience

Being part of an elite network could give you access to top executives. It could certainly help you close large deals. It could even help you find a job if you get laid off. MBA is a great networking tool. It will certainly help you build your LinkedIn connections. There’s a reason a lot of the partners at top venture capital firms have MBAs, although that’s not necessarily the case with some of the younger partners at newer VCs.

On the other hand, there’s nothing that can replace real life experience of working at a start-up. If you want to be able to relate to founders, you must either bring personal operating experience or have experience working with many entrepreneurs. You cannot learn venture capital by taking a class on entrepreneurship or venture capital investing. HBS cases, as good as they may be, do not reflect how difficult it is to fight for deals. They do not help you understand what it’s like to sit across the table from an entrepreneur who has poured every ounce of his energy and his entire life savings into the company and say “no.”

This person is a career switcher, sort of. An MBA is great for that. That’s why people take summer internships. However, if you have the opportunity to do something new now without an MBA, you should definitely take that opportunity. Salespeople says, “Always Be closing.” To those contemplating choosing between an MBA program and a start-up, I say, “Always Be Learning.” Remember that most of the learning in life occurs outside the classroom.

Getting an MBA is safer than working at a start-up

We get health insurance not because we want to get sick, but rather because we want to be able to pay for all medical expenses in case we do get sick. An MBA is a great career insurance, but it’s also an expensive one. Weigh the costs. What is your drag coefficient? Can your tolerate the start-up lifestyle? The chance of achieving monetary success is probably bigger for an MBA than it is for an entrepreneur. Most start-ups fail while most MBAs will steadily climb up the corporate ladder. There’s nothing wrong with climbing the ladder. It’s a good way to make money and your family will appreciate you for it.

However, you also have to consider the cost of missed opportunities. Let’s face it. Life is ridiculously short. One of the top five regrets of the dying is, “I wish I had the courage to live a life true to myself, not the life others expected of me.” Many people have unfilled dreams. Give yourself the freedom to pursue your passion. If everyone played it safe, our history books would be mind-numbing and boring. That said, it’s important to note that the second  most cited regrets is “I wish I hadn’t worked so hard.” Starting a company or working at a start-up is a lot of work and most of that is not glamorous work. Honestly, a lot of it is pure grunt work. It’s a huge time investment.

What matters the most is you. 

It’s not the degree and it’s not where you’ve worked, no matter how “hot” that start-up might have been. If you want to be a venture capital investor, or anything really, you have got to try your best to make the right connections and equip yourself with the right skills. I’ve seen both successful MBAs and entrepreneurs become venture capitalists. I’ve also seen the reverse where mediocre former entrepreneurs and MBAs, despite wanting desperately to become a VC never quite get there. As we’ve all been told byour parents and teachers, we are are responsible for our own actions.

Therefore, whatever path you choose, whether that’s getting MBA, MS in something cool, or joining a start-up, make sure you have the end goal in mind. Go do what you love. Don’t do something because you think it’s the right stepping stone to something else you want.

By: Jonathan Lee
Twitter: @hi5at5

Life at a start-up, one year in

It’s hard to believe, but I’ve already passed the one year mark at Rixty. Holy schnikes! Has it really been over a year? Time sure flies by quickly when you are working your butt off. It’s been a crazy ride so far and I’ve learned a ton.

This is now my fourth, but first full-time, start-up experience. I had a typical pre-MBA path: consulting and finance. I could’ve gone back to that life, but I’m happy I didn’t even though I’m not rolling in Benjamins like my friends in consulting or banking.

Start-up life is not glamorous

An early-stage startup is of course not as established as a Fortune 500 company. For small companies, there’s no formal HR department (which means I can get away with more random BS) or an IT Help Desk (which means you can’t blame anyone when your laptop crashes). When something breaks, you have to roll up your sleeves and fix it. An MBA does not get a special treatment. Titles are meaningless. Everyone is equal. Leave your egos and personal agendas at the door. We all work extremely hard to make things happen and keep our partners and customers smiling from ear to ear.

It always takes longer so expect the unexpected

Building a new product or adding a new feature to an existing product always takes longer than expected. Sure, large companies miss deadlines too, but the impact of a delay is much bigger for a smaller start-up. Whether it’s because you found a bug or you had some external factors that you couldn’t control, delays really suck big fat you-know-what. It doesn’t happen often, but when we are delayed, I’ve learned to not freak out like my head is on fire, but stay calm and work with what I’ve got to close a deal instead of complaining about what I don’t have.

You grow professionally and personally at start-up

I used to believe that strategy consultants and investment bankers, because of the breadth of their work and the long hours they spend working, learned at least twice as much as employees at other companies. That could be true, but I now believe that you have more unique opportunities to acquire new skills and grow as a person at a start-up. When you are building the bridge you are walking on and are wearing multiple hats in a single day there’s no shortage of opportunities to grow. I could be in a new role with new products in new market all in a single day. If you don’t like uncertainties, life at an early-stage start-up is probably not for you. If you want to be challenge until you don’t want to be challenged anymore, then a start-up is the perfect place for you. We only take ambitious, hungry people who want to rock like a rock star on steroids.

Don’t take rejections personally

There are days when building something totally new could be a grind. You love what you have helped build, but what if it’s not getting the love you feel it deserves? When that large deal that would have helped the company tremendously doesn’t go through, it could feel worse than kicked between your legs (well, maybe not literally). However, you can’t take rejections personally. Large companies get rejected all the time, although the pain is probably not as great when you have hundreds of million of dollars in the bank and have a thousand other products you can ship to your other partners. Either they are not smart enough to see the value-add of your product or you need to refine your pitch. Or perhaps you need to change your product. Iterate, iterate, iterate, and go do it some more until it’s perfect. Change it up so that it becomes relevant to the party with which you are trying to build a long-lasting partnership. But never take rejections personally. If you are a start-up, most likely, you are building something so new that it’s difficult for some people to immediately understand the value you bring. That’s okay, just keep trying.

Stay hungry. Stay foolish– But be Patient and Smart.

Your company is probably not going to IPO for $10 billion in 10 months. It’s unlikely to get acquired either. Build, scale, sell. Repeat. Do it over and over until that day comes. Stay hungry and foolish, but don’t be delusional. Start-up life is like running a marathon; it’s not a sprint. Success isn’t built over night. At the same time, you have to know when to quit. Don’t listen to the naysayers, but don’t ignore them either. In poker you have to know when to bluff to represent a hand you don’t have, but you also need to know when to fold to minimize your losses. Be hungry, but also be patient and smart. Wait for the right cards, the right moment to go all-in.

By: Jonathan Lee
Twitter: @hi5at5